Canada’s new border deal with the United States could lead to fewer missed connections at the airport, more American law-enforcement officials working on Canadian soil, harmonized U.S. standards for prescription drugs, new names for cuts of meat and fewer inspections of food cargo as both governments strive to ensure better information sharing and less red tape for companies trying to get their goods and people across the largest land border in the world.
The wide-ranging Perimeter Security and Economic Competitiveness Action Plan was described by Prime Minister Stephen Harper Wednesday as the most significant step forward in Canada-U.S. co-operation since the North American Free Trade Agreement.
For cargo from overseas, the U.S and Canadian governments hope to de-clutter the border by screening goods only once — when they first arrive.
Two pilot projects in Prince Rupert and Montreal will be launched in 2012. Shipments coming from overseas will only be screened on arrival and won’t be inspected on subsequent border crossings unless absolutely necessary. If the pilot projects work, single screening will become the new norm.
For businesses, other pilot projects are being developed, such as a pre-inspection of cargo carried on trains, which will begin in September. Another year-long project will involve issuing advance clearance for trucks carrying fresh meat.
The governments will also move to eliminate red tape. For example, an American firm wanting to import fridges currently has to file paperwork with nine government departments, in the future all those applications will be filed through one website.
The trade compliance implications of the new border deal for importers and exporters will doubtless be many and varied as aspects of the sweeping initiative are progressively implemented in future. A number of key features of the 29-point deal — including an accord on regulatory reform — are estimated to still be three to four years away from practical realization.
Related Information:
• Perimeter Security and Economic Competitiveness Action Plan
• Fact sheet from the White House
We received one update that suggests a positive outcome of this deal is the alignment of what we call low value shipments and the applicable NAFTA free trade rules associated with those types of shipments. While this streamlines the process, the compliance caveat has always been that if audited you must prove that at that time the goods in question did qualify which means you need audit trails and good records management.
“According to the documents provided today the governments will increase and harmonize the value thresholds to $2,500 for expedited customs clearance from the current levels of $2,000 for the United States and $1,600 for Canada. As well Canada will increase the value threshold to $2,500 for exemption from North American Free Trade Agreement Certificate of Origin requirements, thereby aligning it with the current threshold of the United States.”