Weighing in

by Bonnie Toews

OTTAWA, Ont. – The Canadian Trucking Alliance (CTA) has played a critical role in seeking revisions to the draconian “strawman” rules recently introduced by U.S. Customs Service, rejecting the need for data to be submitted before cargo is loaded.

Now the pressure is on to see if the industry’s proposals can make it through the U.S. government agency.

To meet the 2002 U.S. Trade Act’s requirements for advance reporting of electronic cargo, Congress upset the original timetable for harmonizing border data. As a result, Jim Phillips, president of the Canadian/American Border Trade Alliance, maintains U.S. Customs had to shock the industry into paying immediate attention by making outlandish hours-before-lading proposals.

As expected, the shippers and carriers loudly protested. They feared these rules, if implemented, would severely damage the economies of both countries, in which trade for Canada was valued at $600 billion in 2001.

To collect the industry’s feedback, the Advisory Committee on Commercial Operations (COAC) to U.S. Customs created subcommittees, which included CTA representation. These subcommittees dealt with the details of cargo reporting for each mode. Based on their findings, the COAC formed a counter-proposal to the “strawman” bid, and on Mar. 14, 2003, submitted its new recommendations to the renamed Customs and Border Protection (CBP) Service – formerly U.S. Customs-now under the jurisdiction of Homeland Security.

In its counter-proposal, the COAC rejected the need for data to be submitted before cargo is loaded. The CTA’s written presentation to the U.S. Customs Service Jan. 31, 2003, provides the trucking industry’s reason for turning this pre-notification rule down: “The reality of the situation is that carriers, particularly those operating in close proximity to the border and those supporting just-in-time manufacturing, simply do not know four or 24 hours in advance what may be loaded on a particular truck.”

Under the recommendations developed by the COAC truck working group, all commodities entering the U.S., including food, would be subject to either a 15- or 30-minute minimum pre-notification standard, measured from the time CBP receives cargo data from the broker or carrier.

Whether U.S. Customs officials accept the industry strawman will likely depend on their criterion for setting pre-notification rules, says Phillips.

“You have to give enough time so that, when you transmit the data for each truck shipment, Customs has a chance to run it through its finely tuned, high-risk targeting computer system before your truck gets to the border.”

The CBP Service must now study the COAC’s collective proposal before it publishes another set of proposed rulings in early June prior to issuing its final rulings Oct. 1. Again, Customs will expect stakeholders to respond to its June publication, but at this point, “we can only nibble at the edges,” says John Simpson, president of the American Association of Exporters and Importers.

In his opinion, there will be no room for error or second-guessing after that on anyone’s part.

Carol Fuchs, who chairs the COAC’s ad hoc modal cargo-security committees, assures carriers there will be “ongoing dialogue” between the COAC and CBP right up until Customs publishes its revised pre-notification rulings.

In guiding the development of the COAC report, she has followed the practice of basic journalism: who, what, how, and when – who will provide what information to Customs, through what channel, and when in the supply-chain cycle?

For Fuchs, ‘why’ has never been up for discussion.

She has insisted from the outset that, because Congress invoked legislation to secure supply chains by Oct. 1, 2003, that date must be met.

Unfortunately, the drive to make borders secure preempts the introduction of the U.S. Customs Automated Commercial Environment (ACE) scheduled for early 2004.

The ACE program is designed to balance the interests of trade and security, but automated advance cargo reporting does not occur for another two years after it is introduced.

Customs can’t wait that long, so there is some doubt that the ACE will ever be implemented, leaving a concern among carriers about software compatibility.

In making its recommendations to the COAC, the CTA insisted the automated reporting and targeting methods through all departments must be harmonized – or utter chaos would result through the competing systems.

Is it likely the CBP Service will accept the COAC proposal? Maybe not all of it, but, in Phillips’ view, the imposed position will mandate pre-arrival information be required on all trucks.

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