CTA: Customs user fees would be illegal

OTTAWA (April 1) — Charging user fees to pay for upgrading the U.S. Customs Service’s automated clearance systems would contravene provisions of both NAFTA and the GATT, according to lawyers for the Canadian Trucking Alliance, a lobby group for the trucking industry.

President Clinton’s fiscal year 2000 budget includes a proposal to collect $163 million US a year in fees to offset the nearly $1 billion in costs to replace the agency’s Automated Clearance System (ACS) with new generation system known as Automated Customs Environment (ACE).
The amount of the fee would be based on the amount of data put into the system by the user.

The CTA, a federation of Canada’s seven provincial trucking associations, requested the legal opinion as part of its lobby to have the Canadian government press the U.S. administration to abandon the proposed fee.

Customs brokers, shipper groups, and the trucking industry on both sides of the border have argued that modernization of the ACS — a 15-year-old system that has performed poorly in recent years as demands for data transmissions have increased with the flow of cross-border trade — be paid for through general revenues.

“The federal government must take a stronger stance on this issue,” said CTA chief executive officer David Bradley. “We expect the Minister for International Trade and the Minister of National Revenue to take the issue up with their counterparts immediately.”

He said ACS “is on its last legs and the danger of debilitating system crashes increases with each passing day.”

Over 70% of Canada’s trade with the United States moves by truck, translating into more than 10 million truck shipments per year, or one every three seconds.

Created in the late 1980’s ACS now handles approximately $1 trillion US in imported goods cleared through millions of entries each year, the CTA said.