OTTAWA, Ont. – The latest advance cargo reporting rules for transborder shipments may have been perceived as an improvement on the “strawman” proposal published earlier this year but they still have lots of holes, according to the Canadian Trucking Alliance and the American Trucking Associations.
Both organizations recently submitted their comments on the proposed rule, slated to be finalized in the first week of October, to U.S. Customs.
Questions and criticisms regarding the fate of LTL carriers, advance reporting time frames, LTL shipments, electronic reporting and its impact on the industry, among other things, abound.
While the latest proposed time frames for advance cargo reporting (one hour for non-FAST and 30 minutes for FAST shipments) are an improvement on previous proposals, several aspects of the proposal “still require modification” according to the comments submitted by the CTA’s vice president of regulatory affairs Ron Lennox.
According to Lennox, the time frames for presentation of data for goods moving into the U.S. are still problematic, especially for carriers situated within one or two hours of the border and for just-in-time shipments.
The question of how carriers will know whether all the necessary data has been transmitted to the border is also an issue, he points out, especially when it comes to LTL shipments, where data for multiple loads must be transmitted by the shipper and the importer.
According to the proposed rule, even one missing element could mean an entire LTL shipment would be turned back at the border.
CTA is therefore pushing to have the advance notice time frames shortened even more – to 30 minutes for non-FAST and 15 minutes for FAST shipments.
According to the CTA submission, concerns remain over overlaps and confusion regarding additional and separate reporting requirements for shipments that fall under the jurisdiction of the U.S. Food and Drug Administration (FDA).
Questions also remain as to whether data required by the FDA would be reported to a different source and in a different way than data required by Customs and Border Protection(CBP). This spring, the CBP issued a news release saying a way to combine the two reporting requirements into a single process would be created – by using the CBP’s Automated Commercial System.
The CTA believes the CBP and FDA may be backing away from this commitment, and fears that different information needs on the part of the two departments will present difficulties when it comes to the CBP sharing information with the FDA.
CTA wants a clear indication the two departments will be able to work together to provide information providers with a single reporting process.
As for the mandatory electronic reporting process, the CTA is concerned that it will also inure significant costs for carriers.
The CTA believes an extensive outreach program on the part of the CBP is required to educate carriers about the reporting procedure and time frames.
Even with such a program in place, many carriers will continue to show up at the border with manually presented hard copy instead of reporting in advance electronically, CTA adds. It predicts chaos could result if trucks are turned away at the border, and suggests a period of “educational enforcement,” during which carriers would be issued warnings at the border, and be processed nevertheless, rather than being turned back.
Of course, making sure there are electronic reporting systems and processing lanes available at all commercial ports while awaiting the creation of the promised Automated Commercial Environment (with a specially created truck manifest reporting system) will be essential to a smooth transition, suggests the CTA.
The CTA also criticizes the CBP’s assessment of the economic impact of the rule on U.S. carriers to the exclusion of Canadian carriers.
“If, as the CBP contends, carrier costs can merely be passed on to importers and purchasers of goods, is this not a cost to the U.S. economy, borne by U.S. consumers, and should it not be addressed in the economic analysis?”
The CTA commentary also raises concerns about intermodal shipments, pointing out differences in the information required depending on the mode of shipment. Cargo information provided to the motor carriers currently is that which appears on the ocean bill of lading. It does not affect the kind of information to be required of carriers under the new rule.
Transmitting both sets of data to CBP could create serious problems for this kind of container movement. (In other words, if both sets of data are not sent via the same source at the same time… so much for the time frames.)
The CTA also provides a long list of niggling questions regarding details of the rule and how it will accommodate the minute-by-minute changes endemic to the industry: interpretation of the ITN (Internal Transaction Number) rule for shipments moving out of the U.S. (merchandise licensable by the U.S. Department of State and the Department of Defense and merchandise transiting Canada for shipment to a third country), conveyance number changes due to PAPS (Pre-Arrival Processing System) transmissions between the carrier and the broker, changes to port location and arrival items due to weather, incorrect cargo description, limits for the number of faxes brokers can receive and process and procedures for instances where carriers pick up other carriers’ trailers.
Similar comments and question were raised in the ATA submission, along with a wish list of items the ATA would like to see clarified or amended. In short, the ATA wants the CBP to:
Develop a solution for LTL carriers; recognize the investment, in human resources and in machinery, that will be required to comply with the new rule;
Understand the differences in transborder trucking between Canada, Mexico and the U.S.;
Analyze the capabilities of customs brokers to handle the increase in PAPS transmissions to the CBP; consider finding a way for the carrier to find out in advance, from either the CBP or the broker, whether the information has been received by CBP;
Study the negative effects of down-time on drivers, especially when it comes to complying with the new hours of service regulations;
Develop a comprehensive economic analysis of the impact of the rule on the industry, as opposed to the annexed analysis which the ATA deems “inadequate”;
Change outbound (from the U.S.) requirements so carriers don’t have to transmit specific date elements to AES.
If the demands/comments of both the CTA and ATA seem similar, it’s because both groups worked so closely together on their response to the rule.
The two organizations were also present at hearings regarding the “strawman” proposal.
Be that as it may, what comes down in October may or may not reflect the commentary of the two groups.
In the meantime, Truck News asked carriers of all shapes and sizes if they were prepared to comply with the proposed rule, as it stood when published July 23.
Considering all options
When it comes to mandatory electronic reporting, Bison Transport compliance officer Lisa Jennings says the company, headquartered in Winnipeg, is already considering its options.
“Right now we’re reporting when we get to the border. But we’re looking into how to report electronically – whether we go private or do it in-house. We’re not panicking about it yet – but as it gets closer we probably will,” says Jennings.
Dave Skater, safety and compliance officer for Brian Kurtz Trucking in Breslau, Ont., shares the CTA’s worries about how the rule will affect LTL carriers like his own.
“The only way they can make this work is to make it mandatory for shippers to comply,” he says. “Everything is more complicated for us because we’re LTL. What happens if we have one shipper who doesn’t comply?”
As for reporting electronically, it shouldn’t be a problem, says Skater, given that the company is already faxing in its cargo reports.
That said, Skater is daunted by the sheer volume of faxes that will have to be s
ent once advance reporting becomes mandatory.
“I honestly don’t know how we’ll do it – I imagine a third-party provider could do the reporting relatively quickly – but at the same time, we’ve spoken to the people who do our computers and they say they can set it up for us,” he said.
Advance reporting time frames aren’t a big issue for Merks Farms Transport, based in Avonport, N.S., says dispatcher Stephan Lynch.
But having to report different information to separate departments (the FDA and the CBP) could prove costly, admits Lynch.
“Sure it would cause a huge problem, but I’m not panicking yet,” says Lynch.
“If they want us to comply they’re going to have to make the rules a lot easier to follow.”
Lynch thinks that reporting rules will ultimately be simplified to make compliance easier.
“For now they’re just throwing up a smokescreen to convince people they’re making the border safer,” he says.
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