U.S. COFFEE IMPORT REPORTING SYSTEM QUESTIONED A voluntary compliance system for monitoring U.S. coffee imports under quotas is viewed skeptically by many in the coffee industry, said analysts and trade sources. "Many sectors of the trade, including large roasters and importers, are adamant against voluntary compliance because of the past, which was subject to tremendous irregularities as it became a matter of the trade monitoring each other," one analyst said. On Monday, a National Coffee Association newsletter said the Office of U.S. Trade Representative will implement a voluntary compliance system temporarily because legislation to monitor imports is tied up in the Congressional trade bill. Under the arrangement, milar to one in 1980, coffee importers would voluntarily present needed documents to the U.S. government until Congress approves the monitoring authority, but if coffee arrives without valid certification, it will still be allowed entry. While many believe producers will not seek to add to the overburdened stock situation in the U.S., others believe some will ship outside of the quota requirements in lieu of monitoring controls, trade sources said. "Last time, there was a lot of false information submitted to customs which resulted in a lot of indictments and fines," a U.S. Customs spokesman said. "Customs can do a good job when given the tools, but when its hands are tied, it doesn't have the authority to demand Form O (documents tracking merchandise from source to destination)," he said. Many see it as a true test of whether producers and importers will abide by the quota system. "It is a key to seeing whether there are any teeth in the quota agreement," said one major U.S. roaster. "Last time we had a gentleman's agreement, the trade did not act as a gentleman," said another analyst adding, "without the need to submit documents, the ball will be in the producers' hands." Some feel that importers will take advantage of the voluntary compliance due to development of a two-tier market, in which non-member countries buy coffee at a big discount. Many fear that dealers will buy coffee destined for non-member countries at discounts and then bring it into the U.S. falsely labelled. According to customs officials, several green coffee importers confessed in 1985 that they had imported coffee fraudulently after buying it for non-member destinations, forging landing certificates and then relabelling it as navy beans. "If there's that much of a discrepancy between prices for one country and another, producers may be teted to get rid of their stocks of coffee by selling to non-member nations and by circumventing the quota provisions," said Paine Webber analyst Bernie Savaiko. Still, others believe that producers will not be hard pressed to aggravate the overburdened coffee stock situation in the U.S. in the near term. "It would be naive to suggest that any agreement would not have some share of connivance, but I think the voluntary system seemed to suffice and, coupled with the fact that we have so much coffee, I don't think that it poses that much of a threat," one trader said.