Security at the Canada-U.S. border has produced an alphabet soup of customs and immigration initiatives: FAST, CSA, C-TPAT, PIP… But in recent months, the spiciest acronym for truckers, custom brokers, and importers is AMPS, the Canada Customs and Revenue Agency’s Administrative Monetary Penalty System.

The program, which came into full force Oct. 7, 2002, is more about proper tariff codes than terrorism — it allows Canadian customs officers to levy fines for certain breaches of regulations, like failure to properly classify goods, on the spot. Penalties can be as large as $25,000 or 60 per cent of the value of the shipment-plus potential criminal prosecution –depending on the type, severity, and frequency of the infraction. As well, once fines are levied, they must be paid; AMPS is an appeals-based process. Prior to AMPS, CCRA officers had two options: either seize the goods and take violators to court, or impose fines that were so light they were almost incorporated into the cost of doing business.

AMPS is a hit, if the abrupt shift in attitude among those involved with moving goods into Canada is any indication. Because of the new penalties, fewer people seem willing to bend the rules or look the other way when an importer fails to properly report goods coming into the country or misclassifies products, either accidentally or deliberately to take advantage of lower rates of duty.

For truckers, it means the load just sits there until the issue is resolved.

“If we were familiar with the shipper and the importer, we’d make the necessary adjustments to the documentation and everything would flow through smoothly,” says Lori Berketo of UPS-SCS (formerly Starber Customs Brokers) in Fort Erie, Ont. “But CCRA has taken a much stronger position on that now. Under the AMPS program, we can be fined for altering the documentation.” These days, she generally decides to take the prudent route rather than an expeditious one when a problem arises: the only person who can make changes is the importer or the exporter, she says.

For truckers, the situation is compounded when you have eight to 10 shipments on one truck, says Jodi de Groot, a customs and import expert at Spring Creek Carriers, a less-than-truckload fleet in St. Catharines, Ont. “If one doesn’t clear properly, everything grinds to a halt at the border,” she says.

de Groot, whose job it is to check paperwork faxed in by her drivers before forwarding it to the customs broker, says it’s hard to convince shippers to change their practices when they don’t experience the consequences of their errors. If she finds a discrepancy or missing information in the reams of paper required to clear goods through customs, she contacts the shipper and fixes it. For all the hurdles she clears every day, the freight keeps moving, and the source of the problem — the shipper — rarely feels the pinch.

“Drivers want to keep moving,” says de Groot. “They don’t want to spend the night at the border waiting for the shipper to respond to the broker to solve the problem. It’s costing everyone — except the shipper — a fortune.”

Berketo reminds carriers that, by far, incomplete paperwork is the biggest culprit for customs-related delays. Among the most frequently overlooked items:

Description of goods: The description must be more than a part number or some sort of product code. For example, it should read, “cases of laundry detergent,” not “XB417, 8.8 kg.”

Piece count: This field should say, for example, “24 skids,” or “2,000 pieces,” or in some cases, “one truckload.” Export papers should be consistent with the bill of lading.
Weight: The weight must be noted in pounds, kilograms, tonnes, etc., on the export papers, and it should be consistent with the bill of lading.

Currency: The currency of the transaction must be noted, either in U.S. or Canadian dollars.

Value of goods: The value of goods must be noted, either in U.S. or Canadian dollars.

Country of origin: This means the country where the goods were manufactured. This must agree with any markings applied directly to the goods, such as “Made in U.S.A.”

Date of direct shipment to Canada: This is the date the truck leaves the shipper’s door, not the date the truck crosses the border.

Ken McCarthy, director of the AMPS program for CCRA, says everyone should be paying closer attention to their obligations as they move goods across the border into Canada. He notes that, as with shippers, most of the penalties assessed to trucking companies revolve around documentation snafus — a lack of a readable bar code or an incorrect carrier identification code.

McCarthy admits the mere prospect of certain types of penalties has some carriers using tactics that leave importers and customs brokers frustrated. “The most contentious has to do with carriers trying to avoid a C274 penalty (covering estimated time of arrival),” McCarthy explains. “They’re not submitting any information about their time of arrival for fear that they’ll make an error, which means they’re not submitting any release documentation until their driver is sitting in the warehouse.”

McCarthy hopes AMPS will correct any perception among importers that compliance is something better left to those who physically haul or clear their freight. In most cases, he says, AMPS penalties accrue to the importer, not the broker; because every Customs officer will have access to the importer’s trade history, the decision to inspect any given shipment is based on past AMPS contraventions.

“The idea is to allow inspectors to focus on those with a record of poor compliance,” McCarthy says. “With AMPS, we have to improve compliance. It’s not designed to be punitive. AMPS penalties have to be corrective.”