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Prepare Now – CBSA Planning to Cancel eHBL for Back-to-Back Shipments Clearing from a Primary Warehouse

Due to security and program integrity concerns, the Canada Border Services Agency (CBSA) has determined that until systems enhancements are in place to fully support eManifest program integrity, an interim process to address electronic house bills is necessary.  The CBSA is presently drafting a new Customs Notice that will ‘stop’ allowing back-to-back/ single shipments filed as electronic house bills to release from primary warehouses.  This ‘suspension of eHBL for back-to-back/ single shipments’ will be in place during the interim period announced in Customs Notice 17-15.

The new Customs Notice will state “All electronically transmitted house bills must be destined to a CW warehouse.”

Essentially this means that the CBSA will prohibit eHBL back-to-back/ single shipments from clearing from a primary warehouse.  We are ‘rolling back the clock’ to pre-November 2016.

Forwarders must revert to filing ACI S10 Supplementary data and clearing on the primary carrier cargo control number for all back-to-back/ single shipments clearing from a primary warehouse.  The sooner forwarders make the change the better, to ensure marine back-to-back eHBL filings don’t have to be cancelled while enroute when this new rule comes into effect.

There are several reasons that the CBSA must take this step.  First and foremost is lack of security with the Deconsolidation Notice and 8000 cargo control number (CCN) release requests from primary warehouses.  In our January blog Don’t File eHBL on Back-to-Back Shipments: Liability Too Great, we outlined the reasons why filing eHBL for back-to-back/ single shipments was risky for forwarders.  Well, that risk has proved too great for the CBSA so they are rolling back eHBL for back-to-back/ single shipments clearing from primary (terminal, rail, airline) warehouses. If you are one of the forwarders that managed to control your risks and started filing eHBL for back-to-back shipments, you have more work ahead to change back.

The other problem is that the business relationship for cargo reporting and arriving is between the primary warehouse and their customer, the carrier, not with the forwarder. As a result, the primary warehouses have no visibility to the freight forwarder 8000 CCNs, their systems don’t recognize the 8000 releases, and so they are drowning in paper.  Also, currently back-to-back release requests on 8000 CCNs at the primary warehouse must be on RMD as the primary warehouses generally cannot ‘arrive’ an 8000 CCN, which is causing considerable problems for everyone.

The Good News:

The good news is that back-to-back/ single shipments will revert to clearing on the 9000 CCN.  This means that there is no Deconsolidation Notice and no paper required at the terminal / railroad.  This also means that back-to-back shipments can clear on PARS in the same timeframes as any other 9000 release request.

The Bad News:

More work and more changes for forwarders. Forwarders must change their processes and communicate with origin agents as soon as possible to make the switch back to ACI filing for back-to-back shipments.  Everyone must revert back to ‘pre-November 2016’ procedures for back-to-back shipments.

It will take the CBSA at least a couple of weeks to finalize their Customs Notice, get it translated and up on their website.  Their notice period may be relatively short. The situation at the railroad terminals is critical and we’re heading into peak season.

We urge everyone to get out ahead of this change and revert back to filing ACI Supplementary S10 data and clearing on the primary 9000 as soon as possible.  Forwarders do not want to be caught with back-to-back eHBLs on the water that would have to be cancelled.

Start now.

PS: Remember, a back-to-back shipment is a ‘single’ shipment where one primary carrier bill of lading or airway bill is consigned to the freight forwarder and one housebill is consigned to the importer.  Canadian freight forwarders manage thousands and thousands of these inbound transactions every year.

 

Revised and reposted June 30, 2017

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