Importing goods in containers can result in an inspection, regardless of whether your shipment enters Canada or the United States. Importers can prepare in advance to get ahead of challenges that arise due to container inspections.
A small fraction of containers are selected for inspection, but the disruption created by examining containers can create significant costs and delays. Understanding how inspection facilities work, what factors increase the likelihood of an inspection, and the types of inspections customs agencies conduct can help importers better prepare.
Overall, about 4% of containers arriving in Canada are selected for inspection. However, it should be noted that containers shipped by rail are the least likely to be subjected to inspection. Port congestion, drayage scheduling, unloading, and reloading containers at a MCEF can extend shipping delays by several days, or even weeks during busy shipping seasons.
The cost of container inspections will vary according to the shipment that’s selected for inspection. Some of the key cost factors include unloading and reloading fees, drayage costs, and examination charges.
There isn’t a specific formula to determine inspection costs. However, the costs can range from $500 to $5,000, which is a significant difference between the two extremes.
Importers should also consider the indirect cost of inspections. Delays due to inspections can result in:
Similarly to Canadian container inspections, a fraction of containers arriving in the U.S. is subject to inspection. Around 11 million containers travel through U.S. ports annually, with an inspection rate between 3% and 5%.
Previous issues with compliance and shipments from higher-risk countries increase the odds of an inspection. The CBP can target specific tariff classifications for inspections, or decide to randomly select a container. Importers are responsible for paying inspection costs.
The type of inspection carried out by CBSA and CBP agents can be placed into three different categories.
The least invasive and time-consuming container inspection involves a scan of the cargo using imaging such as x-rays. For this type of examination, the seal on the container remains intact.
For this type of inspection, agents open the container and visually inspect the content. A tailgate inspection takes a bit more time and costs more than a non-intrusive inspection.
The most expensive, time-consuming, and intrusive inspection starts with the container moving to an examination facility. Goods are unloaded from the container, inspected, reloaded, and then transported back. This type of inspection is the least likely to occur.
There’s always a possibility that the container storing your imported goods will be inspected. You can’t control when these inspections take place, or the containers that will be inspected, but you can reduce potential delays and costs.
A strong track record of compliance can help reduce the odds of being selected for repeat inspections. Customs agencies are much more likely to scrutinize importers who make mistakes in their paperwork or fail to provide required documents. Consistent compliance greatly reduces the odds of frequent inspections.
Contingency plans for your shipments help to increase your resilience to unexpected delays caused by inspections. Plans could include extra time and resources in the event of an inspection, including costs related to delays. You could also arrange a backup plan with carriers and supply chain partners to ensure that customers receive their goods on time, even if an inspection takes place.
Trade security programs, like Canada’s Partners in Protection (PIP) or the U.S. Customs-Trade Partnership Against Terrorism (C-TPAT), provide benefits for importers who maintain strong compliance and security processes. Earning the trust of the PIP and C-TPAT programs can result in your shipments given lower inspection priority. This greatly reduces the odds of an inspection while improving how quickly your goods move across the border.
Container inspections are a reality of global trade. They protect borders and ensure compliance, but they can also disrupt your business if you’re unprepared. By understanding how inspections work in Canada and the U.S., budgeting for potential costs, and working with experienced customs professionals, you can minimize the impact and keep your supply chain moving.
Cole aligns with how your company works. If your supply chain operations change, we provide solutions tailored to help you adapt and thrive. Connect with Cole today.