US Customs and Border Protection Tests Blockchain to Verify NAFTA and CAFTA Certificates of Origin

Blockchain Testing to Start for US Customs and Border Protection To Preserve Free Trade and Validate Certificates

Governments around the world are still debating the regulations that govern cryptocurrency and exchanges, but blockchain technology seems to be the most adapted technology around right now. Many governments and industries are finding ways to use the distributed ledger, and the United States seems to be interested in trying their luck as well with Customs and Border Protections (CBP).

The US Customs and Border Protection agency plans to test out the technology with as part of the approval process for both the North American Free Trade Agreement (NAFTA) and the Central American Free Trade Agreement (CAFTA) certificates of origin. The reason that this agency wants to use blockchain is for the verification of the original source of any item that comes into the US borders. However, the blockchain actually logs much more information, including any trademarks with the produce and the physical properties, ensuring that the US gets exactly what it should.

Vincent Annunziato, who is in charge of Business Transformation and Innovation at US Customs and Border Protection, said that the new system will help unveil any dishonest trade practices. He also hopes that it lets them see exactly how American imports are traded before the country receives them.

Right now, everything that is validated with imports has to be manually processed, and the whole system is paper-based, which can make it cumbersome to check every import. However, with blockchain, Annunziato hopes that the technology will be adopted to more mainstream markets and will be ready to take on private industries as well.

It is clear that Annunziato has a lot of faith in blockchain and DLT technology. In fact, he has even praised the borderless concept of it, specifically with shipping, but he does not see all 47 connected agencies dropping their current rules and regulations to comply. He said,

“It’s a very interesting time right now, but I think it’s a good time for the government to be involved because we’re starting to really push forward and make sure things are honest and working the way they’re supposed to.”

Based on a news report from American Shipper, Annunziato also discussed a committee that was working on a new blockchain-based platform that would identify IP licenses and licensors. The committee, Commercial Customs Operations Advisory Committee (COAC), is only working on this as a trial to see how it could help with authenticating intellectual property.

The trial for the CBP and blockchain technology, in regard to certificates of origin, will be launching in September. Hopefully, this is just another way that blockchain solidifies its place in the industry.

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