By Keith Norbury

The long-delayed implementation of the Canadian Border Services’ new electronic manifest system for freight forwarders should begin by the end of this year, says the Chairman of CIFFA’s Customs Committee. “Freight forwarders should expect to be ready no later than December 2015 for implementation,” said Paul Hughes, who serves on CIFFA’s national Board of Directors and works as national manager of customs compliance for Agility Canada. That deadline might be extended, but freight forwarders “should be ready by that date,” he added.

And that would be for freight forwarder electronic house bills in all transportation modes, he pointed out.

In an email response to written questions, CBSA spokesperson Pierre Deveau confirmed that the regulatory amendments requiring eManifest “for highway carriers, rail carriers and freight forwarders” became legally binding on May 6 through publication in the Canada Gazette. However, Ruth Snowden, CIFFA’s Executive Director, noted that freight forwarders will have approximately six months to get ready because CBSA still has systems issues and underlying policy issues that they either have to build or resolve.

Mr. Hughes said that during that initial six months, Customs may issue “zero-rated” AMPs (administrative monetary penalties) — in other words, penalties without fines. That is something CBSA also confirmed. Mr. Hughes also indicated that during the zero-rated period, CBSA won’t stop the flow of goods across the border by highway and rail carriers that don’t submit the data electronically. According to the CBSA website, eManifest is a major initiative of the Canadian government that “is about getting the right information at the right time” to help the CBSA “identify potential threats to Canada, while facilitating the movement of low-risk shipments across the border.”

It is the third phase of CBSA’s Advance Commercial Information program. The first two phases “require air and marine carriers to submit pre-arrival cargo and conveyance information electronically, within advance time frames,” CBSA says. “When fully implemented, eManifest will require carriers, freight forwarders and importers in all modes of transportation (air, marine, highway and rail) to electronically transmit cargo, conveyance, house bill / supplementary cargo and importer data to CBSA prior to loading in the marine mode and prior to arrival in the air, rail and highway modes.”

Make no mistake, CIFFA is very supportive of eManifest. As Mr. Hughes said, “It will save time. There will be less paper involved. There will be no running to Customs getting documents stamped before you can distribute them to a broker for custom’s clearance. At the end of the day, it’s going to be a far more seamless and productive world.”

However, CIFFA has also been frustrated by technical glitches and bureaucratic obstacles that have delayed eManifest’s implementation. Even so, CBSA has managed to address many of CIFFA’s concerns. For example, CBSA clarified in a letter to CIFFA last September that a freight forwarder only needs to provide HS codes or customs/tariff numbers on their electronic documents if those numbers were provided to the freight forwarder in the first place. That same letter — from Jason Proceviat, Director of CBSA’s programs branch — also stated that “CBSA designed the freight forwarder ACI transmission structure and requirements in a way that avoids stakeholders having to share proprietary business information.”

Mr. Hughes confirmed that. “There are no details as to the individual consignee or consignees that may be in the shipment or shippers,” Mr. Hughes said. “That information we do not provide to the carriers, for commercial reasons. We don’t want them going after our customers, for example. Some of them are interested, some aren’t.”

Many details about the eManifest saga, however, are complex, convoluted and arcane. In delving into them, Mr. Hughes cautioned that he was “getting into the weeds.” Suffice it to say that eManifest was supposed to become mandatory last July and missed that target by a year. Mr. Hughes attributed much of the past problems with eManifest to a lack of coordination among the various silos at CBSA that were working on its many parts. “Now they have a project management team in place which has started to tie all this together,” Mr. Hughes said. He praised CBSA for recognizing the problems, taking a step back, and making “every effort” to ensure a successful transition to eManifest. “I think it’s important that their efforts at putting it together after their previous years of not doing it right should be recognized,” Mr. Hughes said.

Another problem, though, is that the computer systems of most primary terminal operators are not set up to handle the new freight forwarder carrier codes required under eManifest. According to a posting on the CIFFA website, “With the implementation of eManifest, freight forwarders will require an 8000-series carrier code (a four-character code that begins with an 8) in order to transact business with CBSA.” Mr. Hughes said the protocols to enable those transactions aren’t expected to be published until July or August. After that, the terminals will need to undergo the necessary systems changes. “Will it be ready by December is the $64,000 question,” Mr. Hughes said. “Those are the mains stumbling blocks.”

Asked what hurdles need to be overcome, CBSA answered by email, “As with any large initiative, technical and policy issues are being identified and resolved during the development and implementation phases. A voluntary compliance period remains in effect for freight forwarders and CBSA will communicate the implementation timeline for eManifest requirements once confirmed, and in advance of the mandatory compliance date.”

In an editorial in the spring edition of CIFFA’s Forwarder magazine, Ms. Snowden wrote, “We’ve been working on these files for years and it seems that progress is measured in micro-centimeters.” She hoped then that within 18 months “we’ll have a big bang and jump forward a kilometer towards a new era where we can reap the benefits of some of these initiatives.”

A CBSA update in that issue of The Forwarder also stressed, again, that before eHBL (electronic house bill of lading) becomes mandatory, “we must have a sold platform of policies from which to operate transmissions in the thousands, and a regulatory framework that is reasonable and workable.” Ms. Snowden said in early June that adequate testing of the eManifest systems still hasn’t taken place.

“And one of the reasons, for example, is because CBSA wants us to build our systems and go on and test,” Ms. Snowden said. She cited the example of one international freight forwarding firm, which she declined to identify, that tried to test its system, but wasn’t able to do so because of conflicts between requirements of the existing paper-based system and the new electronic one. At present, a carrier or a freight forwarder acting on behalf of a carrier still has to submit supplementary data ACI (advanced commercial information), Ms. Snowden said. “So at some point, probably toward the end of this year, the freight forward ehouse bill eManifest will become mandatory and then we won’t have to submit this ACI (advanced commercial information) supplementary.”

Asked about that, CBSA responded by email: “With the implementation of eManifest, freight forwarders will be required to transmit advance house bill data electronically to CBSA. The data must be received and validated by CBSA prior to arrival, within the prescribed mode-specific time frames. CBSA will communicate the implementation timeline for eManifest requirements once confirmed, and in advance of the mandatory compliance date.”

However, when the aforementioned freight forwarder tried to flip to the new system, there was still a requirement for the paper house bill. “But you can’t have the same cargo control number for the ACI supplementary transmission as your release request; customs won’t allow it,” Ms. Snowden explained. Or, put another way: “You can’t test because you can’t use the same cargo control number.”

This Catch 22 forced the freight forwarder to flip back to the paper system in order to carry on. “So I don’t know how anybody’s going to test on a systems basis with the existing situation,” Ms. Snowden said.

In its emailed response to Canadian Sailings, CBSA said it is “working closely with clients throughout the registration, testing and implementation phases,” and advised clients to contact CBSA’s Technical Commercial Client Unit website, , “for electronic transmission support.” CBSA also said, “To ensure a successful implementation, CBSA conducts comprehensive testing that includes test cases, incremental releases and

running new systems parallel to current systems prior to activation.”