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| Canada-Jordan Free Trade Agreement Now in Force | 
Effective October 1, 2012 producers and exporters across Canada will benefit from reduced or eliminated tariffs on nearly all of the country's current exports to Jordan. The elimination of tariffs on forest products, machinery and agricultural products will greatly benefit Quebec and the Western and Atlantic provinces. Ontario stands to benefit with regard to key exports, such as machinery, vehicles, tires and furniture.
The Canada-Jordan trade agreement is Canada's first with an Arab country and only the second in the Middle East, after the agreement with Israel. The agreement demonstrates the importance Canada places on further developing relations with Jordan, a country that plays an important role in the Middle East, especially by promoting peace and security in the region. In 2011, Canada had a trade surplus with Jordan. Two-way trade totalled almost $89 million, with Canadian merchandise exports to Jordan reaching $70.1 million, more than double the $31 million in 2003. |
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| Michigan to Vote on New Bridge Crossing |  | |
The Michigan International Bridge Initiative is on the November 6, 2012 statewide ballot in Michigan as an initiated constitutional amendment.
If enacted this measure would require voters to approve any new bridge or tunnel from Michigan to Canada. The measure was proposed by the Detroit International Bridge Co. (owners of the Ambassador Bridge) and is being sponsored by a committee called The People Should Decide. Filings made with the Secretary of State indicate that owners of the existing bridge spent $4.7 million on the ballot initiative.
In June, Michigan Gov. Rick Snyder (R) reached a public-private partnership agreement with Canada to build a second bridge crossing between the Detroit and Windsor.
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East Coast/Gulf Coast Port Strike Averted
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After working with mediators from the Federal Mediation and Conciliation Service, the International Longshoremen's Association and the U.S. Maritime Alliance recently agreed to extend the Sept. 30 deadline for a new contract until Dec. 29. They have also agreed to continue negotiations.
The National Retail Federation applauded the move but remains concerned until such time as a final contract is ratified.
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Video of Canada Consumer Product Safety Act Webinar
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Health Canada has posted a video of its CCPSA webinar online.
Ms. Helen Ryan, Director General of Health Canada's Consumer Product Safety Directorate, provides an overview of the new CCPSA regime.
The video highlights key partners, the previous Hazardous Products Act Part 1 with a particular focus on industry's key new obligations, Section 14, the duties in the event of an incident, your mandatory reporting obligations, requirement to maintain and prepare documents for traceability.
To view the 90 minute webinar click here.
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Obama Launches China WTO Action on Autos & Parts
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The Obama administration launched a sweeping new enforcement action with the World Trade Organization (WTO) against China last month, alleging that its unfair trade practices are putting U.S. manufacturers at a competitive disadvantage by illegally subsidizing exports of autos and auto parts.
According to administration officials China has provided at least $1 billion in export-contingent subsidies between 2009 and 2011 in violation of WTO rules and the nation's agreement upon joining the organization in 2001.
The subsidies contribute to the outsourcing of U.S. auto-parts production to China, the officials said.
The WTO action follows one in July in which the U.S. challenged China for imposing duties on more than $3 billion in American-produced automobiles. The administration also requested that the WTO form a dispute settlement panel to consider that case.
In spite of the highly integrated North American auto industry, parts makers in Canada aren't lobbying the federal government to take action against Chinese imports.
"There's nothing planned on the Canadian side," said Steve Rodgers, president of the Automotive Parts Manufacturers' Association.
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Polls Show Mixed Opinions About Free Trade Agreements
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On the 25th anniversary of Canada-U.S. free trade agreement, new polling by Nanos Research indicates that one in three think the Canadian economy is better off with the FTA. Canadians however are more likely to be unsure about the impact of the North American Free Trade Agreement has had on the economy.
With regards to the proposed Comprehensive Economic and Trade Agreement (CETA) currently being negotiated between Canada and the European Union, two in five think such a trade deal with EU would have positive impact on economy.
Click here to download the complete summary of the poll results.
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| GHY E-Newsletter October 2012 |
Final Countdown to Comply: eManifest Becomes Mandatory November 1, 2012 On November 1, 2012 the Canada Border Services Agency's mandatory eManifest requirement for highway mode will come into force. This means that your highway carriers must be ready to transmit advance cargo and conveyance data to the CBSA by this date! Are your contract carriers, truck brokers, 3PL providers, and their drivers ready for this important change?
If not, your shipments could be delayed and/or refused entry by CBSA at the border. If you haven't already discussed and received assurances on the eManifest readiness of your highway supply chain partners, then we strongly urge you to do so now! This is crucial to ensuring smooth and disruption-free highway clearances for your business. CBSA has recently sent eManifest communications to more than 21,000 registered carriers and 250 trucking and trade associations in efforts to increase eManifest implementation. Additional outreach to the top 500 high volume carriers has been made. Despite these ongoing efforts, the CBSA is concerned by the large number of carriers who have not yet signed up to begin testing data transmissions for eManifest. If any of these carriers are moving your freight, then now would be a good time to encourage your trucking service providers to adopt eManifest in time for the November 1st deadline. What GHY is doing
GHY has launched a new ACI and ACE eManifest Portal making eManifest requirements easier and faster for highway carriers and importers with their own trucks. Try our industry leading eManifest Portal or Fax-to-eManifest Services today. The GHY eManifest Portal allows you to file all your ACE and ACI eManifests, get entry number texts to drivers and fax coversheets online. It connects you directly to Canada Border Service Agency and U.S. Customs and Border Protection. Sign up here! |
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Wood Packaging and Pallet Update
The following information is from Wanda Alexander, Senior Specialist, Forestry Products Certification, CFIA providing background on the treatment requirements for wood pallets and packaging moving between Canada and the U.S. as well as suggestions for text that you might consider using for shipments where there is a mixture of ISPM 15 marked and unmarked pallets.
Commodities moving between Canada and the US are eligible for the ISPM 15 exemption as long as the wood packaging (WP) is of Canadian or US origin "and" there is a declaration of origin on the export documents. In other words, either the ISPM 15 mark must be on the WP or there is a declaration of origin on the shipping documents to allow Customs to verify the origin of the  WP.
If a border guard is not able to verify the origin of WP at the border, the shipment may not be approved for release. To avoid this from happening, exporters need to include a statement of origin in their export documents declaring the Canadian or US origin of unmarked WP in their shipment, as applicable. This statement is especially important when the goods in the shipment are of a foreign origin other than CAN/US, and/or the shipment contains both marked and unmarked WP. In these two situations, there is more question on the origin of any unmarked WP in the shipment from the point of view of a border guard.
Here are some examples of what to write/type on the shipping documents (as applicable) when exporting/importing commodities containing WP between Canada and the US :
"the unmarked wood packaging in the shipment is of Canadian origin"
"the unmarked wood packaging in the shipment is of Canadian and US origin"
"the unmarked wood packaging in the shipment is of US origin"
If all of the WP is unmarked, could more simply state, as applicable: "the wood packaging in the shipment is of Canadian origin" etc.
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Pacific Freight Rates Set to Rise Next Year
Container lines serving the Asia-U.S. trade lane reaffirmed their commitment to reversing 2011 and 2012 losses, and to raising the baseline for freight rates as they head into a new round of 2013-14 contract negotiations with customers.
Member carriers in the Transpacific Stabilization Agreement (TSA) have adopted a set of guideline rate and ancillary charge adjustments that they intend to apply to all new and renewed service contracts, from all Asian origins, to become effective with those contracts, from mid-October going forward. This includes "early bid" contracts concluded in late 2012 and early 2013, as well as standard contracts which typically take effect on May 1, 2013.
TSA is recommending rate increases of US$800 per 40-foot container (FEU) to the U.S. West Coast; $1,000 per FEU via all-water to the U.S. East and Gulf Coasts; and $1,200 per FEU for intermodal shipments via all coasts.
Members also reiterated the need for full fuel cost recovery, including the bunker charge; the recently adopted low-sulfur component to address the higher cost of using cleaner-burning fuels within North America coastal zones; and a new, simplified intermodal fuel component - a single component for all inland destinations that will be incorporated into the bunker charge and will replace the current inland fuel surcharge, effective Jan. 1, 2013.
TSA executive administrator Brian M. Conrad said container lines have faced a steep uphill climb throughout 2012, to reverse dramatic revenue losses as steeply discounted rates in key lane segments crept into 12-month contracts. "The eastbound transpacific is a dynamic, highly competitive market," Conrad explained. "Rates negotiated for one route or commodity too easily go viral, spreading to all routes and commodities. That may often be the nature of markets, but it does not necessarily mean those rates are anywhere near economically sustainable for lines carrying the cargo."
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CBP Expanding Eligibility for Importer Self-Assessment Program
U.S. Customs and Border Protection has issued a general notice making the Importer Self-Assessment program (ISA) available to more participants. Effective immediately, a company that has successfully undergone a CBP Focused Assessment (FA) audit may be eligible to transition into ISA without further CBP review within 12 months from the date of the FA report wherein CBP has determined that the company represents an acceptable risk. Under this policy any interested company that has successfully completed an FA in the last 12 months (i.e., since October 2011) may apply to transition into ISA.
To qualify for ISA the company must be a U.S. or Canadian resident importer (CBP sources confirmed that Canadian resident companies that import into the U.S. are included in this description), obtain membership in the Customs-Trade Partnership Against Terrorism, develop a risk-based self-testing plan, and agree to meet all ISA requirements. The application review meeting normally conducted for ISA applicants will not be required.
ISA is a joint government-business initiative designed to build cooperative relationships that strengthen trade compliance. It is based on the premise that companies with strong internal controls achieve the highest level of compliance with customs laws and regulations. CBP states that benefits of participation in this program include removal from the audit pool established for Focused Assessment, expanded opportunity to file prior disclosures of certain violations, mitigation of civil penalties and liquidated damages, expedited cargo release, and priority consideration for applications to participate in the Centers of Excellence and Expertise tests.
CBP is proposing the change outlined in this notice because the FA is a more rigorous and thorough method of examining a company's internal systems for compliance with customs laws and regulations than the ISA review process. The notice sets forth the process that companies that have successfully completed an FA can use to apply to transition into ISA, the requirements they will have to meet after making that transition, and the reasons a company may be removed from ISA.
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Assistant Commissioner Gina Shares CBP's Top Trade Initiatives
When CBP's Assistant Commissioner of the Office of International Trade Allen Gina spoke to trade business leaders from the National Customs Brokers & Forwarders Association of America, NCBFAA recently he lightheartedly greeted them in jest. But he wasn't kidding when he told the group how much they were valued by CBP.
"The truth is the NCBFAA and each of you are extremely important to us," said Gina, who was the keynote speaker at the opening day luncheon of the association's 2012 Government Affairs Conference held in Washington, D.C. "When we think about partnerships and partners, the NCBFAA is one of the most critical. Every commissioner to date, including Deputy Commissioner [David] Aguilar, recognizes that and he wanted me to convey that to you today."
Gina, pinch-hitting for Aguilar who was in Texas, also told those attending that the deputy commissioner's focus is on modernizing and streamlining. "Everything we do needs to be safer, faster, cheaper," said Gina. To illustrate his point, he shared the agency's top trade transformation initiatives. The seven initiatives include-the Role of the Broker; ACE, the agency's automated cargo processing system; the Centers of Excellence and Expertise, Simplified Entry-Air Cargo Advanced Screening, trusted trade partnerships; trade intelligence, and One U.S. Government at the Border.
Among the key points Gina expressed was the importance of the ACE program. "There's no way we're going to transform our operations with an antiquated system or paper forms. There needs to be some type of automation and ACE is it," he said. "I'm a big believer that the only way we're going to create efficiencies in the future is to deliver ACE to you. I'm here to tell you that the agency is fully committed to continuing with ACE's development and delivery."
Gina also noted that the new industry specific Centers of Excellence and Expertise were game changers for the agency. "The centers are going to create tremendous efficiencies for CBP, for other government agencies, and for the trade community at large," he said, assuring the audience that brokers will be involved in the process. "I'd like to dispense with the notion that brokers do not have an active role to play within the centers. Nothing could be further from the truth," he said. "By partnering with brokers, CBP has expanded our facilitation efforts, streamlining the import process-and the centers are the strategic platform to continue this partnership."
Note: CBP has posted to its website an update on the functionality already implemented in the Automated Commercial Environment as well as near-term priorities for other ACE deliverables, including e-manifest for rail and sea, cargo release and export processing.
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New Supply Chain Planning Model Highlights
Traditional supply chain planning (SCP) tools have been around for many years and are among the most adopted SCM technologies. However, we are reaching a tipping point where the complexity of supply chains is defeating SCP tools in the battle to come up with an overall optimized plan.
To provide the right type of capability for supply chains today and in the future, the way we think about supply planning has to change, as do the tools that support planning.
As supply chains become more global, the planning models become larger and more complex, with increasing connections between the different nodes where resources and facilities are shared across a more expansive supply chain. This is a symptom of supply chains moving from being local to regional to global in nature. As the planning models become larger, some SCP tools struggle, due to scalability and performance issues, to plan and optimize these larger models, leaving islands of planning in situ with local optimums, but a suboptimized overall plan.
This potentially leaves companies having to cope with fragmented data, process and analytical models across a supply chain. As supply chains migrate from local to regional to global, there will be a lack of planning visibility and integration across the supply chain, unless there is a planning system that can unify the plans across the complete internal supply chain. This lack of visibility inhibits the trade-off exercises needed to find a profitable balance point.
Read the complete white paper by clicking here.
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NAFTA Rules of Origin: Proposed Amendments - Domestic Consultations
The Department of Foreign Affairs and International Trade (DFAIT) in conjunction with the other NAFTA parties have proposed changes to the NAFTA rules of origin with a view to liberalizing or simplifying some of the rules as they apply to several product categories, which include:
miscellaneous edible preparations; petroleum; products of the chemical or allied industries; plastics and rubber and articles thereof; cork; glass; non-ferrous metals; certain machinery and mechanical appliances; certain electrical machinery and equipment; sound and television image recorders and reproducers; locomotives; parts for trailers and semi-trailers; optical, medical and measuring instruments and parts; medical and other specialists' chairs and other furniture; toys and games and miscellaneous manufactured articles.
These changes will be the fourth set of amendments that have been introduced to the NAFTA rules of origin since 2005, and these proposed amendments are planned for implementation in 2013.
For additional details of the proposed amendments and specific changes, and the address for making any comments refer to The Canada Gazette. The Gazette notification also includes a reference to the current NAFTA Annex 401 rules of origin for comparison of the existing rules to the proposed amendments for purposes of determining how these changes may affect you.
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 Finding time to follow the latest international trade developments and programs of Customs agencies on both sides of the border relevant to your business can be challenging, so we hope you find this issue of our Tradelines e-newsletter to be a helpful resource in this respect. As always, we'd greatly appreciate any opinions, comments and suggestions you may have to help us improve this information resource, so please don't hesitate to let us know what you think. If you haven't already, we'd like to take this opportunity to invite you to check out our Tradelines E-News weblog where you can find current stories updated daily about business events and developments that are important to Canadian importers and exporters.
If you would like to keep up to date on the latest developments in trade compliance and trade compliance strategies, please check out our Trade Compliance weblog.
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As well, you can follow any of the links below for the latest information, updates and links to articles of interest.     |
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