Dazed and confused: FDA customs rules too complicated?
June 1, 2003
TORONTO, Ont. - Just when you thought you were getting a handle on the newly-proposed Customs Border Protection (CBP) rules for pre-notification, along comes the Food and Drug Administration, with a w...
TORONTO, Ont. – Just when you thought you were getting a handle on the newly-proposed Customs Border Protection (CBP) rules for pre-notification, along comes the Food and Drug Administration, with a whole other set of pre-notification and registration rules.
The proposed rules, which made their debut on the U.S. federal register Feb. 3, have had trucking associations, carriers and owner/operators on both sides of the border scrambling to respond.
Slated to go into effect in October (registration) and December (pre-notification) of this year, the rules are in no way integrated with the CBP-inspired rules.
The FDA proposals require separate registration and pre-notification procedures for all import items regulated by the FDA.
In two submissions to the FDA presented Apr. 4, the Canadian Trucking Alliance (CTA) broached its many concerns with the proposals.
Regarding the registration proposal, aimed at identifying the manufacturers and processors of food products, the CTA says it needs clarification on definitions, including to what extent transportation operations and equipment will be covered by the registration requirement, whether trucks constitute “holding” containers under the proposed law, and whether trucks would have to be registered.
What the truck drivers, carriers or O/Os would do if they reached the border with a load and discovered their shipper wasn’t registered is, of course, another concern.
As for the proposed pre-notification rules, again the subject of who is responsible for pre-notification comes into play. The proposed form that would require filling out includes purchasers, importers, importer agents, carriers, purchaser agents and in-bond carriers among the potential candidates.
The proposal also requires the pre-notification forms be filled out and delivered no less than eight hours and not less than five days prior to lading.
(This compared to the latest industry-backed proposal to CBP which would require 15 to 30 minutes minimum pre-notification, according to the CTA.)
Thus, the FDA pre-notification time constraints pose serious logistical problems for carriers and O/Os, especially those carrying mixed food and non-food loads.
Not to mention those carrying fresh foods or just-in-time deliveries across the border, a reality which the CTA points out in its submission to the FDA.
Clearly in either case, the resulting potential border hang-ups would be very costly for all concerned.
But what’s most galling for industry players is that if both the CBP and the FDA proposals become law, shippers, importers or carriers will be required to fill out two sets of pre-notification forms destined for two different agencies.
“…what we find particularly problematic is that the FDA requirements are being layered on top of prior notification requirements currently being developed by CBP,” states the CTA submission to the FDA.
Industry people, from carriers to O/Os, couldn’t agree more.
Enter Mark Seymour, president of Kriska Group of Companies. Kriska, headquartered in Prescott, Ont., is a significant player in the temperature control market, hauling food shipments into the U.S.
Seymour questions the wisdom of legislation requiring two sets of pre-notification rules.
“It certainly begs the question why? If you’re going to do something that significant to the supply chain then I think it has to be well reasoned and explained,” says Seymour.
As for prenotification itself: “It’s going to be a logistical nightmare. Making it so that we have to pre-notify of a shipment crossing the border and narrow it down to a window of time during a particular day, there are too many influences that could impact our ability to meet that time.
“We need to resist initiatives that add costs to the supply chain. I see a significant impact to the cost of managing our operations but, quite frankly, don’t understand the reason for this type of pre-notification.”
Karen Gallant, customs administrator for Challenger Motor Freight, shares Seymour’s concerns.
“If we get to the border and then discover the proper forms haven’t been filled out, who’s liable?” she wonders aloud.
“We need to be able to check up on the shipper or whoever was supposed to get it done.
“Otherwise, how do we know our trucks will get through?”
Gallant doesn’t think registration or pre-notification reporting should be the carrier’s responsibility.
“The shipper has that kind of expertise,” she says.
Bruce Richards, of the Private Motor Truck Council, says registration will obviously pose less of a problem for private carriers.
But the pre-notification process could still be problematic, he says.
“We recognize that we’re going to have to do more paperwork and we’re prepared for it,” he says.
“But it would certainly be easier if we had some consistency between the different rules. It seems absurd not to have just one channel to report to, which could distribute the information to all the agencies concerned.
“But any carrier could have mixed FDA and non-FDA loads, and that’s where I presume the most lead time would be needed.”
Lead time on FDA-regulated loads is just one concern for owner/operators, says Leo Van Tuyl, interim executive director of the Owner-Operators’ Association of Canada (OBAC).
“What happens if an O/O picks up a load just an hour from the border but then has to wait until pre-notification goes through because it wasn’t done properly in the first place?” he asks.
“What if he gets to the border and finds out he can’t get through?”
These concerns, as well as liability for lost loads and compensation for lost time are issues that should be addressed in the contracts O/Os sign with their carriers.
“First, they should make sure to have a contract. Second, they should make sure it protects them and compensates them for lost time,” Van Tuyl says.
Van Tuyl also feels it would be better to have one single channel to report to rather than several.
Having a single information channel was one of the goals of the Automated Customs Environment (U.S.) and its Canadian counterpart the ACI (Automated Commercial Information), destined to be implemented in 2004 and 2005 respectively. (Both were in the works prior to 9/11).
“In the meantime, we have rules coming out that would appear to be counter to that objective,” points out Ron Lennox of the CTA.
Be that as it may, trucking industry players may just have to bite the bullet, says Frank Bowen, president of Bowen Enterprises and a long-time member of the motor carrier industry (since the 1950s).
Bowen is a regular at customs committee meetings in both the U.S. and Canada, including the Commercial Operations Advisory Committee (COAC) to U.S. Customs, which included CTA representatives and which was instrumental in modifying the Homeland Security-inspired “strawman” proposal for pre-notification at customs.
News of whether COAC’s recommendations on this set of pre-notification rules made an impression should be available mid-month, Bowen says.
Bowen is less than optimistic about the FDA’s openness to trucking industry concerns.
“Whereas the CBP included truck industry professionals in the advisory committee, the FDA, so far, hasn’t done that,” he points out.
Seymour is more optimistic: “It certainly seems there is more and more dialogue of late. I’m optimistic that nothing will get pushed through without due consideration being given to all those that it will affect.”
Be that as it may, carriers and O/Os who think they can avoid getting into the pre-notification game may be sadly mistaken, says Bowen.
“It’s the sort of situation where the carrier or the O/O who waits until the gun goes off could end up waiting for a very long time at the border,” Bowen says.
In other words, carriers and O/Os who want to survive the transition to the age of electronic information had best be prepared.
For the text of the proposed rules on FDA regulated items, as well as copies of the proposed forms to be filled out, visit www.trucknews.com and click on the Special Features button box on the right.
For more information on the CTA’s su
bmissions to the FDA regarding its proposed pre-notification and registration rules, visit the CTA site via our hot links at www.trucknews.com