CTPAT/AEO – Supply Chain Security Management

Essential Details

AIAG members developed the first common system for automotive importers and their supply chain business partners complying with the Customs Trade Partnership Against Terrorism (CTPAT), the U.S.-based Authorized Economic Operator (AEO) program.

What is CTPAT?

CTPAT is a federal government program set up by the U.S. Customs and Border Protection (CBP) that allows companies shipping goods and materials into the country to become certified as a low-risk security threat. Certification means that cargo can move more quickly through U.S. Customs checkpoints.

Much like OEA in Mexico, and PIP in Canada, this cooperative, voluntary government-sponsored initiative intends to improve international supply chains and border security. As one of the largest and most complex parts of the U.S. Department of Homeland Security, CBP and its CTPAT program prioritize keeping terrorists and their weapons out of the country.

In order to be CTPAT certified or compliant, a supply chain partner must meet CBP’s minimum security requirements by answering a set of questions as part of a risk assessment. In recent years, CBP has taken a stronger enforcement posture to prevent and penalize the importation of goods produced using forced labor into the United States. As such, all AIAG CTPAT/AEO – Supply Chain Security Management risk assessments address CBP mandatory forced labor requirements. AIAG continues to work closely and strongly with CBP to ensure compliance throughout participating supply chains. 

The AIAG CTPAT/AEO Program

In collaboration with OEMs and suppliers, AIAG has developed the first common system that automotive importers and their supply chain business partners use to comply with CTPAT/AEO requirements. The CTPAT/AEO – Supply Chain Security Management Program is a subscription-based service that allows trade partners to complete one risk assessment that is universally accepted by all participants. AIAG regularly monitors CBP changes to CTPAT and incorporates them into the system to ensure ongoing compliance. CBP has named the AIAG system an official best practice.

The system includes:

• Risk assessments tailored to each type of supply chain business partner — including manufacturers, highway, rail, air, and sea carriers, and more

• Associated corrective actions required to meet the most current Minimum Security Criteria (MSC) required by CBP

Benefits of the system:

• Extensive data security capability

• Global threat assessment information available for all countries and can be evaluated by specific trade lanes

• Importers and their supply chain business partners have a common process to request, complete, and evaluate supply chain security

• Reporting capability can be used when conducting supplier security validations and as supporting supply chain security documentation for material supplied to CBP

• Suppliers with multiple importer customers need only answer one risk assessment

• Business partner risk assessment information is tagged to help automotive importers visually identify and track their supply chain risks

Recognizing Authorized Economic Operators (AEOs)