Trucking Questions New Customs Requirement to Declare Residual Chemicals Crossing Border

This story appears in the Aug. 23 print edition of Transport Topics.

Truckers, chemical manufacturers, and other trade groups are questioning a new federal requirement that motor carriers and exporters stipulate on electronic manifests the amount of residual chemicals left inside cargo tank containers when returning from deliveries in Canada and Mexico.

The new policy is not restricted to hazardous materials or chemicals, but it also includes any product ranging from corn syrup and chocolates to nonhazardous resins, said John Conley, president of National Tank Truck Carriers.

The new requirement, which has yet to be enforced, was originally set to become effective in August 2009. It is a post-9/11 U.S. Customs and Border Protection reversal of a policy dating back to 1994.

Customs officials now say the policy must change to “ensure homeland security and the safety of inspectors.”

A CBP spokeswoman confirmed that the agency is in discussions with the carrier and export industries, but she did not explain why the residue is considered a threat to homeland security.

“The lack of compliance with customs laws is not only a security risk to the U.S. but a potential risk to the health and safety of CBP officers unaware of the volume or contents of the containers they are encountering,” said the spokeswoman, Jenny Burke.

Tom Schick, a senior director at the American Chemistry Council, a trade group that represents chemical manufacturers, said the industry remains “baffled” as to why the policy switch was needed.

“There have been numerous meetings but nobody has been able to figure out the rationale for what they did,” Schick told Transport Topics. “To place a burden that hits on the companies that export and the carriers that serve those companies — which would be rail or truck — I think is not a wise policy.”

In a July 26 letter to CBP, Margaret Irwin, American Trucking Associations director of customs, immigration and cross-border operations, said the new policy would “frustrate cross-border commerce and will not enhance the safe or secure transportation of these containers.”

“This will only impede the flow of international freight, do nothing to serve the shipping or regulatory communities, and add costly impediments to motor carrier operations,” Irwin stated.

In 1994, the agency told Dow Corning Corp. that it would allow containers with residual chemicals to be entered on customs paperwork as empty containers, saying that because the residue was considered a part of the “instrument of national trade,” a container was allowed to come back into the country without being declared.

Irwin said that CBP officials, in proposing the new policy, told ATA that the 1994 letter to Dow Corning gave the company an individual exemption and was not meant to allow the entire export industry to label their loads as empty on manifests.

“Everyone took this ruling for Dow meaning that this was the way we would all do this,” Irwin told TT. “There have been no violations issues since the Dow ruling — in 15 years, not one penalty.”

“It’s the oddest situation I’ve ever encountered with Customs, with them saying that the 14 years of non-enforcement was a mistake,” Irwin added.

“There have been no problems from a safety standpoint or a security standpoint that would require this change,” NTTC’s Conley told TT. “But if in fact they’re made the decision that they’re going to make a change and start enforcing something like this, the more latitude they can give a carrier, the better.”

CBP penalties for violations of border crossing procedures can carry a fine of up to $10,000. However, most violations are much lower unless they are serious and blatant, Irwin said.

Because it is nearly impossible for a tank truck to completely unload all of its content — unless it is thoroughly washed — ATA has offered CBP a “hybrid solution,” said Richard Moskowitz, ATA vice president and regulatory affairs counsel.

The ATA compromise solution would create a safe harbor for residue returning to the United States in quantities below 3% of the container capacity. In these instances, carriers would identify the residue that is returning to the United States by use of an abbreviated manifest.

Under the ATA proposal, the carrier would not have to estimate the exact quantity of the residue nor its value. Residue in excess of the 3% safe harbor would have to be entered and manifested under the existing CBP procedures.

“We feel that our proposal gives Customs all the information that they need to fulfill their duties and at the same time does not impose an unreasonable burden on the carrier,” Moskowitz said. “Customs has agreed to delay enforcement of its new policy while they work with the affected industries on a solution.”