Better Border Coalition Recommends 3 Levels of U.S.-Canada Trade

(The B3 coalition represents companies that have significant manufacturing operations, including integrated supply chains, in Canada and the U.S. in a wide range of industries. Collectively members of B3 account for roughly 35% of the trade volume across the Canada/U.S. border. Their members are vetted trusted trading partners of governments through trusted shipper programs such as Customs Trade Partnership Against Terrorism (C-TPAT) and Customs Self-Assessment (CSA).)

Says Shipments within a Single Firm or Supply Chain Dominate U.S.-Canada Trade

In its letter, B3 states that the U.S. and Canadian governments manage and regulate trade between each other in the same way as trade from off shore, foreign markets. The reality is that unlike trade with foreign markets, trade between these markets is dominated by cross-border shipments within a single corporate enterprise or within an integrated supply chain with known trade partners. As such, trade data requirements should not be the same for internal market shipments as they are for foreign imports and exports because the risk is not the same.

Wants Working Group to Consider Three-Levels of "Benefits & Investment"

The primary objective of B3 is to reduce the cost of border compliance for integrated industries, by reducing the regulatory burden for border crossings and shortening border crossing times through the enhancement of existing trusted trader programs.

The coalition proposes providing benefits to companies according to the level of investment they make in trade compliance and supply chain security. They envision separating traffic and its reporting requirements at the border into three distinct types based on the levels of investments made by companies and the advanced knowledge and information of those companies that governments have, as follows:

No investment (Level 1). Companies that have not invested in trade compliance or security partnerships with government must provide full transactional data details well in advance of shipment arrival at the shared border so that governments can complete the necessary risk analysis. Data requirements and reporting timeframes should be harmonized to the existing CBP’s ACE program.

Supply chain programs only (Level 2). Companies that have only invested in supply chain security trusted trader programs should be provided dedicated primary inspection lanes with data requirements and reporting timeframes aligned with current U.S. C-TPAT/FAST.

Supply chain and compliance programs (Level 3). Companies that have invested in both supply chain security and trade compliance trusted trader programs should be provided with unimpeded access across the border with a rolling stop process that eliminates transactional data reporting requirements with full data reported summarily post importation. This process would be an enhanced version of the current Canadian CSA/FAST requirements.

Three-Level Program Could be Achieved by Harmonizing/Expanding Current Programs

The coalition says that governments and regulators could create a new 3-level border system by harmonizing and expanding existing trusted trader programs and their benefits, in order to demonstrate a clear, bottom line return on investment for both government and industry. Current Canadian programs include CSA, Partners in Protection (PIP) and the pilot program Partners in Compliance (PIC). Programs in the U.S. include Importer Self-Assessment (ISA) and C-TPAT. The roadmap B3 provides would:

Harmonize release procedures. Harmonize to the most effective security and release procedures at the Canada/U.S. border. Immediate attention should be focused on aligning data requirements for shipments between the U.S. and Canada with fewer data requirements for foreign shipments; aligning data reporting timeframes for all shipment types; eliminating reporting and tracking requirements on returnable containers of international trade that are moved between Canada and the U.S.; enforcement of IPR and trademark regulations to guard against third country counterfeit goods; etc.

Align regulations, regulatory reporting processes. Align regulations and regulatory reporting processes across government agencies and departments. B3 states that there must be a complete review of all non-customs requirements for importing and exporting between the U.S. and Canada and externally to identify all differences between requirements, with the goal of:

• Align import and export requirements between government agencies.
• Eliminate all requirements between Canada and the U.S. where there are no identified health and safety or security concerns and/or via mutual recognition of each other’s health and safety regimes.
• Eliminate all reporting requirements at the border and allow companies to report post importation.
• Most importantly must be implementing of a single window reporting process across all other government departments in Canada and other government agencies in the U.S. Companies must be able to report all importation and exportation requirements electronically and through one source in each country. This would also support government needs for security as they would be able to view importation and exportation data holistically in order to make effective and efficient determinations on potential threats.

Implement perimeter processing requirements. Implement coordinated Canada/U.S. perimeter border security and processing requirements. This should be accomplished via identical data requirements and reporting timeframes for external shipments for customs release; identical data requirements for regulatory compliance for other government department requirements; etc.

Expand, improve infrastructure. Expand and improve the existing trade infrastructure. Most of the trade infrastructure that carries the majority of Canada/U.S. trade, and supports the integrated industry was built in the 1920s and 1930s and was designed for a completely different economic reality. With technology improvements and investments in traffic streaming through the ports, governments and bridge operators have maximized the potential of these crossings. However those crossings, especially the bridges and tunnels between southern Ontario and New York and Michigan, are not

equipped to handle modern integrated supply chain necessities, trusted trader programs and security requirements.

Reduce barriers to movement of personnel. Reduce barriers to the movement of business personnel. Integrated companies require staff to travel across the Canada/U.S. border frequently in the support of company operations, including product development, equipment installation, maintenance and emergency repairs, and product launches. Recent documentation and visa requirements in both Canada and the U.S. have made cross border travel difficult for all personnel, including those that have proper travel documentation, such as passports and NEXUS certification. Among other things, B3 suggests that the governments eliminate visa requirements for Canada/U.S. citizens and permanent residents traveling for business purposes.

(See ITT’s Online Archives or 02/07/11 news, 11020729, for BP summary of the declaration.

See ITT’s Online Archives or 05/24/11 news, 11052418, for BP summary of CBP Commissioner Bersin testifying that the agency is working with Canada on a pre-clearance pilot as part of their perimeter approach to security and trade.)