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FAST Lanes Across the Border – Windfall or Minefield?

November 12, 2005

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Article Originally Published: November 2005

The information contained in this article is not intended to be legal advice. Readers should not act or rely on this information without consulting an attorney.

Following years of statutory enactments, action plans, and border modernization conferences, the era of electronically controlled border crossing for goods moving between Canada and the United States finally has arrived.

As of May, 2005, systems for required electronic pre-notification of inbound truck shipments from Canada to the U.S. were in place at all U.S.-Canada border crossings.

Carriers willing to invest time and resources in these systems will obtain major benefits. There are major risks for these carriers, however, if operating plans go wrong.

A system known as PAPS (Pre-Arrival Processing System) is the current fallback system for carriers crossing the border on a low volume basis. PAPS essentially uses a carrier’s ties to customs brokers to create the required electronic pre-notification to the U.S. Bureau of Customs and Border Protection (CBP).

To participate in PAPS, the carrier provides CBP and customs brokers with its SCAC code and prepares bar code labels which contain the SCAC code and a pro number or entry number to be used for individual shipments.

On individual shipments, a manifest is prepared at the point of pickup and faxed to the customs broker. The transmittal includes information on the border crossing that the carrier will be using and the expected time of arrival. The customs broker then transmits this information electronically to CBP. The electronic transmittal must occur at least one hour before the carrier arrives at the border crossing.

For ongoing operations, the system providing the most expedited border crossing option is FAST (Free and Secure Trade System). The FAST system offers expedited clearance at most border crossings and requires only a 30 minute advance notification of an impending shipment. While the carrier continues to carry paper documents to the border and make fax transfers to customs brokers as in the PAPS system, expedited clearance is possible because under FAST the carrier’s drivers and customers are also pre-screened.

In order for shipments to qualify for FAST treatment, carriers, shippers, and drivers all must be pre-certified. For carriers and shippers, the pre-certification process consists of receiving approval of an application to participate in the Customs Trade Partnership Against Terrorism (C-TPAT) program. Both C-TPAT carriers and C-TPAT shippers are required to file detailed security plans describing their supply chain facilities and business activities in connection with these applications.

For drivers, the FAST program is administered jointly by U.S. and Canadian customs and immigration authorities. In order to be issued a FAST certification, a driver is required to complete the certification process in both countries. Driver applicants are subject to background checks and are reviewed, photographed, and eventually issued a FAST commercial driver card.

Benefits for fully certificated FAST carriers are significant. Operating through FAST lanes creates considerable time savings. FAST participants also receive more expedited treatment in the custom penalty process.

Significantly greater benefit, however, comes from being one of the relatively small number of carriers which has gone to the effort of obtaining FAST status and hiring FAST-qualified drivers. Substantial portions of traffic moving between Canada and the U.S. are becoming limited to carriers and drivers holding FAST-approved status.

FAST carriers, however, also face substantial risks of having their FAST status revoked for violations which might not cause problems in a normal operating situation. A prime example is illegal drug activity by FAST carrier drivers. Having drivers apprehended for drug offenses at the border may trigger a suspension of FAST privileges.

For carriers which have made substantial equipment investments based on movements for FAST-qualified shippers, suspension of FAST privileges can be disastrous. A substantial investigation may be required before FAST privileges are restored. CPB officials charged with monitoring the FAST program may fly-spec the carrier’s security plan and require implementation of special security measures.

Present and potential FAST carriers should be forewarned. While FAST presents many operating and financial benefits, FAST operations must be controlled more strictly than normal operations. The down-side risk to a carrier’s business from a serious FAST violation is far too great to do otherwise.