In jurisprudence and law enforcement, "chain of custody" refers to the integrity of evidence and requires a documented process showing the "seizure, custody, control, transfer, analysis, and disposition of physical and electronic evidence. Documentation should include the conditions under which the evidence is gathered, the identity of all evidence handlers, duration of evidence custody, security conditions while handling or storing the evidence, and the manner in which evidence is transferred to subsequent custodians each time such a transfer occurs."
The question is whether this chain of custody concept can be applied and used in the world of global container security, trailer security and railcar security. In fact, there is equivalence today in handling containers and trailers, especially in light of some new changes to the Federal Rules of Civil Procedure.
Giermanski Says... |
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| Smart containers provide the electronic equivalent of a receipt showing evidence of contents and evidence of shipping. The evidence is provided by a specialized electronic application usable only by an authorized individual at the point of origin. |
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In 2006, the U.S. Supreme Court approved amendments to several rules. In short, the changes allow electronically stored information (ESI) to be requested during discovery for admission in trials in U.S. courts, assuming, of course, that it meets the legal thresholds for the admission of evidence.
Furthermore, ESI evidence that includes virtually all electronic records and communications, including e-mails, may be obtained through subpoena in criminal cases and by pretrial discovery in a civil case. Thus, information contained in electronic systems used in the global supply chain are now have the potential for use as evidence in matters arising from supply chain disputes and compliance with mandated requirements in government programs such as Customs and Border Protection programs like the Customs Trade Partnership Against Terrorism (C-TPAT) and the 10-Plus-2 Program.
The most common and fundamental problem in transport today comes from the very conveyance of goods in the global supply chain. If one sends goods in an open conveyance, like coal in a rail car, it would be reasonable to expect and difficult to prove that all the pieces of coal that started the journey at origin ended the journey at destination. However, with common shipping containers, there is no problem in assuring the sender and receiver that the all the goods "stuffed" into the container at origin are, in fact, the same goods in the same quantity that arrived at destination and that nothing has been added into the container nor taken out of the container. What we now call smart containers provide an ESI chain-of-custody.
First, smart containers provide the electronic equivalent of a receipt showing evidence of contents and evidence of shipping. The evidence is provided by a specialized electronic application usable only by an authorized individual at the point of origin. Similar to the law enforcement officer collecting evidence, that person is identified as the authorized person supervising the stuffing of the container and verifying its contents. At the time the electronic application is transmitted into the smart container system, there is a data transfer of the person verifying the cargo and its quantity and booking information and/or bill of lading information agreed upon by the shipper and consignee, to include information for customs and border protection as necessary and the activation of the system. The data can be transmitted by satellite or radio frequency.
Second, depending on the robust nature of the hardware, the smart container provides a unique identifier for tracking, which allows the consignee or consignor to "query" the container while it is in transit and also allows the container itself to report independently any movement off its intended journey. Satellite-monitored and tracked smart containers automatically offer through the use of a worldwide call centers third-party record of any break in the chain-of-custody.
 Third, a smart container employing the chain-of-custody process can provide an electronic receipt of delivery, generated by the opening of the container at destination by a person approved and authorized to open the box. Its opening is accomplished by another specialized electronic data key usable only by an authorized individual at the point of destination.
The only real difference with the chain-of-custody described in other legal circles is that the smart containers can do all of this electronically. Law enforcement cannot. Smart containers not only meet the challenges of providing a good control similar to a registered and certified letter in the postal system, but also provide the electronic management not available in documentary chains, thus exceeding the demands of jurisprudence.
The final attribute and certainly one of the most important is that container security is not really an expense. It is an investment. Numerous reliable studies from organizations at Stanford University, Bearing Point study and A.T. Kearney demonstrate that security, in and of itself, improves the bottom line. Since the president signed the SAFE Port Act on Oct. 13, 2006, further increased savings will be realized by expedited customs and border protection treatment of Tier 3 participants who use smart containers at U.S. seaports and land ports-of-entry.
There are two more significant benefits attached to the use of the chain-of-custody system as it is applied to the global supply chain: Customs Trade Partnership Against Terrorism (C-TPAT) compliance and cargo inspection by firms hired to do so as a result of international trade contracts. For example, the use of the Powers Secured chain-of-custody verifies that those who claim to comply with C-TPAT, actually do comply. By doing so, the chain-of-custody data stored in third-party control centers and also in user servers can be used legally to defend against negative CBP audits or legal claims regarding damage or loss by others within the supply chain, or non-compliance with cargo verifications connected to some legal requirements of the UN Convention on Contracts for the International Sale of Goods (CISG).
Clearly, smart containers do more than provide the confidence associated with a chain of custody. They make money for their users, serve to prove C-TPAT compliance with stuffing at origin, protect the cargo at opening unloading the container at destination, and provide international-trade-contract parties a level of confidence in the issue of what was purchased is what was sent.
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