Clearit.ca's Blog on Customs Brokerage and News Updates
The Canada Border Services Agency (CBSA) and U.S. Customs and Border Protection (CBP) agency have finally reached an agreement on harmonization of data requirements relating to in-transit shipments of domestic goods through their respective countries. The agreement is a necessary step along the road towards relaxing post-9/11 restrictions that have made it impracticable for intra-Canada shipments to traverse the U.S. en route to domestic destinations.
However, under the action plan for the 2011 Beyond the Border U.S.-Canada joint declaration, such a harmonization agreement should have been completed two years ago and become operational six months ago. Further, now that the agreement is in place, implementing it may well take several more years as the CBP and CBSA upgrade their computer systems to be able to receive the data from the counterpart agency in electronic form.
Canadian Shipping Companies Happy about New Agreement
Canadian shipping companies welcomed news of the agreement, with David Bradley of the Canadian Trucking Alliance (CTA) calling it “overdue but extremely important”. Bradley went on to say that now that the CBSA and CBP are committed to working together, they should synchronize their IT systems as quickly as possible so that in-transit shipments can resume. He also suggested that while that process is taking place it would be appropriate to explore interim measures that would make use of the agreed-upon data to allow at least some in-transit shipments through pilot studies or trial projects.
Prior to 2001, Canadian shippers usually routed their vehicles through the northern U.S. when sending cargo between the Quebec City–Windsor Corridor and Western Canada. Going south of lakes Superior, Michigan, and Huron allowed truck drivers to use better-developed American highways and enjoy typically less-severe weather conditions, resulting in safer journeys that saved fuel and were easier on their rigs.
Little Paperwork Was Required
Relatively little paperwork was required as long as the goods being carried were bound for a Canadian destination and would not be used, transferred or stored in the U.S. But security concerns following the September 11 attacks prompted the reclassification of all goods arriving from Canada as international shipments necessitating more complex documentation and advance electronic submission of manifests. While still technically possible, transiting the U.S. became unduly burdensome for Canadian shippers, and the practice came to an end.
(Canada did not change its policy on in-transit shipments, and American cargoes continue to move through Canada, particularly along the Detroit-Buffalo route. This has naturally become a sore point for Canadian carriers, who argue that it puts them at a competitive disadvantage.)
Now that there is a prospect of action on the issue of in-transit shipments, the next item on the agenda of trucking associations in both countries is reform of regulations that prevent truckers who aren’t in their own country from moving empty trailers to another position. The CTA’s Bradley stated that this rule causes unnecessary logistical problems for foreign carriers and called it incompatible with modern practices.