By Keith Norbury

A pre-inspection pilot program for trucks that began this June at the Canada-U.S. border has been performing “beautifully,” according to Jim Phillips, President and CEO of the Canada-U.S. Border Trade Alliance. Beauty, though, is in the eye of the beholder. The Canadian Trucking Alliance doesn’t share that opinion – unless beautifully means that the system is slowing down traffic.

Phase 1 of the pre-inspection pilot began June 17 at the Pacific Highway truck crossing near Surrey, B.C. The pilot, which is a collaborative effort between U.S. Customs and Border Protection (CBP) and the Canada Border Services Agency (CBSA), is meant as a “proof of concept” of the viability of having CBP officers pre-inspect U.S.-bound trucks in Canada before they reach the border, according to a CBP news release. “It’s working beautifully,” Mr. Phillips said, noting that a similar pilot is slated to begin in December at the Peace Bridge between Buffalo, N.Y., and Fort Erie, Ontario. When the program is fully implemented, he predicted, “it’s going to really change the face of the border for “Trusted Trader” cargo and trucks.”

CBSA facilitates trade through its trusted trader programs, which include “Free and Secure Trade (FAST)” (57 approved importers, 659 approved carriers and over 81,000 approved drivers), “Partners in Protection”, and the “Customs Self Assessment program” (78 approved importers and 802 approved carriers). These programs require a secure supply chain and advance risk assessment of importers, carriers and drivers.

About FAST

FAST, a joint initiative between CBP and CBSA, is a voluntary commercial clearance program designed to ensure safety and security while expediting legitimate trade across the Canada–U.S. border. All FAST program participants (drivers, carriers and importers) must undergo a risk assessment. When a FAST-approved driver arrives at the border, he or she presents three bar-coded documents to the border services officer (one for each of the participating parties: the driver, the carrier and the importer). The officer can quickly scan the bar codes while all trade data declarations and verifications are done at a later time, away from the border. Under FAST, eligible goods arriving for approved companies and transported by approved carriers using registered drivers are cleared into Canada or the United States with greater speed and certainty, which reduces costs for FAST participants.

In order to qualify for the streamlined FAST process, goods imported into Canada must be shipped directly to Canada from the continental United States or Mexico, must not be prohibited, controlled or regulated importations as set out in any act of Parliament or provincial legislation, and must not be subject to the release requirements of any other government department.

Truckers concerned about two stops

The Canadian Trucking Alliance, however, doesn’t necessarily endorse the program. “The Pacific pilot was only intended to see if U.S. Customs and Border Protection systems would function on Canadian soil. And CBP made no secrets of the fact that it was understood that it would likely slow down traffic,” Jennifer Fox, CTA’s Vice-President of Trade and Security, said in an interview. “And from what I understand so far, yes the systems work, and yes it has slowed traffic, which obviously from a trucking perspective is very concerning.”

Ms. Fox added that CTA’s formal position on pre-clearance and pre-inspection has always been that they might result in “two stops at the border where there is currently one.”

Under the pilot program only “Trusted Traders” taking part in CBP’s Free and Secure Trade (FAST) program can use the dedicated pre-inspection booth. “Secondary inspections, when required, will continue in the U.S. port of entry,” CBP said in the news release announcing the commencement of the program.

Trusted trader requirement seen as limitation

That only “Trusted Traders” can participate is also one of the limitations of the pilot, Ms. Fox pointed out in. In addition, Ms. Fox said the benefits of FAST lane access are limited by other factors, including the requirement to ensure that a trailer contains only trusted-trader freight. Also, traffic volumes, including passenger car traffic, can limit the ability to access a FAST lane.

“Out in B.C. they don’t have a lot of trusted trader freight,” Ms. Fox said. “There are a lot of trusted trader carriers but not a lot of goods that qualify.” She added that even if the B.C. pilot proves successful, that won’t guarantee success with the pilot in Ontario. “There are many different variables that need to be considered, including existing infrastructure, traffic volumes, volumes and frequency of crossings of trusted trader freight and trusted trader empty conveyances, as well as driver routes – to name a few,” Ms. Fox said. “We definitely want to be part of the oversight body.”

Mr. Phillips, however, described the pilots as an exciting development that will enable trucks to cross the border quickly. “Those that are not marked for secondary (inspection) will go down the road very quickly, easier than they ever have before,” he said.

Joint patrols underway, pre-clearance coming

The next step is to implement “pre-clearance,” which he says goes beyond pre-inspection by completing the process of crossing the border in the other country. “Canadian officers would be in the U.S. and when the car or the truck actually crossed the border, it already has been cleared into Canada by Canadians working in the U.S., and vice versa in the U.S.,” Mr. Phillips said. “That is being negotiated and is not a reality as yet, but it is committed to under the Beyond the Border.”

He hopes to see pre-clearance implemented by early 2014. One stumbling block is indemnity of border officers to ensure they cannot be sued in the course of doing their jobs. “That’s the way it is in the U.S., but it’s not that way in Canada,” Mr. Phillips said. “Canadian officers working in the U.S. could be sued and have to go to court to defend themselves.”

Concerns raised about sovereignty

Canada and the U.S. are already doing joint patrols, such as three-day operations in September on the St. Lawrence River that involved the RCMP’s maritime unit in Kingston, Ont., and the U.S. Coast Guard station in Alexandria Bay, N.Y. Even that level of cross-border jury cooperation has raised concerns for Scott Sinclair, Canadian Centre for Policy Alternatives Senior Researcher on Trade and Investment issues. “I think the concern from Canadians’ point of view is that we will be giving up a certain amount of sovereignty,” Mr. Sinclair said.

Another more serious concern, he said, is that cross-border initiatives might give U.S. authorities access to the personal data of Canadians. “We’ve seen that the National Security Agency and others have been spying on their allies,” Mr. Sinclair said. “They’ve been using this information basically for commercial advantage and diplomatic advantage with no obvious connection to any terrorist threat at all.”

Clear once, admit twice

Mr. Phillips said his alliance presented perimeter clearance as an option in 2003, and wrote a 103-page step by step guide on how to do it. But the Prime Minister at the time, Jean Chrétien, wanted nothing to do with it, Mr. Phillips said. “You couldn’t even use the term perimeter in Ottawa in 2002 and 2003,” Mr. Phillips said. The border alliance revived the idea of perimeter clearance in 2007, but renamed it “coordinated clearance point of departure determination.”

A key feature of Beyond the Border is the principle of “cleared once, accepted twice” for secured cargo entering the North American perimeter. “In other words, the U.S. accepts what lands in Canada before coming to the U.S., and Canada accepts what lands in the U.S. before going to Canada,” Mr. Phillips said. “And that’s been agreed to.”

Pilots underway at Canadian ports

Wendy Zatylny, President of the Association of Canadian Port Authorities pointed out that pilots of “clear once, admit twice” are underway at the ports of Prince Rupert and Montreal for container traffic. “According to what I have heard, the pilot projects are proceeding well, and questions and kinks are being worked out in a collaborative manner among all of the stakeholders,” Ms. Zatylny said in an email message.

From that perspective, Beyond the Border is working well, she added, while pointing out that predictability, reliability, and speed to market combine to produce low shipping costs. “Any effort that provides shippers with improved predictability and reliability and reduced time to market – while yet protecting important security needs – will not only contribute to increased cross-border trade, but will also help ensure that costs are kept low for consumers and businesses that rely on these goods,” Ms. Zatylny said.

Triple acceptance proposed

Not content with “clear once, accept twice,” Mr. Phillips and the border alliance are pressing for a “coordinated clearance,” which means to clear cargo once and accept three times. That would entail inspecting cargo at its point of departure. A container leaving Singapore, for example, would have 100 per cent of its cargo subjected to radioactive screening and be sealed with security devices. The container would not be looked at again until it reached its the port where it is to be destuffed, he said.

The program would only apply to Container Security Initiative ports, he said. But the world has 60 of those ports, which handle 90 per cent of all container cargo.

This proposal, however, was not part of Beyond the Border. “They went for two for one, and we’re just recommending three for one,” Mr. Phillips said. “When they get comfortable with two for one, it’s time to move it offshore.”