CBSA looks to eliminate sufferance warehouses

OTTAWA, Ontario—Over recent months there has been a wave of programs—including Integrated Cargo Security, eManifest, Low Value Shipment (LVS) Threshold—designed to streamline and improve the way goods flow across Canadian borders. The Canada Border Services Agency (CBSA) has been given primary responsibility to manage many of the initiatives on behalf of the federal government.

In February, CBSA held a meeting of its Border Commercial Consultative Committee (BCCC) to review many of the new programs. Minutes of the meeting (which have been made public this week) reveal that work is far from completed on the new border policies. In fact, a number of new programs are in the works. Chief among them is the Cargo Control and Sufferance Warehouse Modernization (CCSWM) initiative.

According to the report, the goal of the initiative is to “eliminate the concept of sufferance warehouses, automate all functions, and reduce the types of warehouses from 14 to two.”

Sufferance warehouses are privately owned and operated facilities licensed by the CBSA for the short-term storage of imported goods not yet released by the CBSA. Typically goods stored in a sufferance warehouse must have a security bond posted and can only remain in the facility for up to 40 days.

At this point, the details of the plan have not been finalized, but a Customs notice, published by the CBSA, describes in a bit more detail what the agency expects the new approach to be. Once implemented, CCSWM will allow “carriers who accept the liability for the goods…to move unreleased, secured cargo in-land directly to their own or a shared CBSA-registered warehouse.”

The notice also explains that “all imported shipments will continue to be risk-assessed by the CBSA at the First Point of Arrival (FPOA) for reasons of health, safety and security. In-land examinations will be conducted at designated locations instead of at each warehouse facility.”

CBSA says it is considering five key changes to the current sufferance warehouse program. They are:

revising the licensing process;
reducing the number and types of warehouse designations;
removing certain restrictions including storage time-limits, class of goods requirements, facilities access, and allowable cargo activities;
allowing operators to co-store domestic and in-bond goods in the same part of the warehouse;
establishing integrated examination facilities for the purpose of inland CBSA examinations;
requiring warehouse operators to use electronic data interchange (EDI) when communicating with the CBSA.

Besides CCSWM news, the minutes revealed a number of other actions, promises and initiatives the CBSA has committed to addressing. Some of these include:

promising to examine LVS issues (for example the difference in value between Canada and the United States for remission orders and the classification to 10 digits);
engaging with the US in an ongoing dialogue about the control and regulation of wood packaging materials used in cross-border shipments;
issuing a report on border fees at the next BCCC meeting;
completing the integration of regional targeting units into the National Border Targeting Centre (NTC) by the end of 2013. (CBSA says this should better allow officers to make assessments about high-risk shipments. In addition, the agency has developed a national targeting training program and is using the program to train its officers.);
examining the possibility of rewarding early eManifest adopters.

It also committed to clarifying the issue of fines—known as administrative monetary penalties (AMPs)—imposed on trucking companies that don’t provide CBSA with documentation under the Advance Commercial Information (ACI) program. Three action items in the minutes indicate the CBSA promises to:

to examine removing zero-rated pre-arrival AMPs from a party’s record after the grace period;
provide clear examples for the different types of AMPs;
examine the question of where responsibility lies if a risk assessment is performed on incorrect information.