US ANTI-DRUG PLAN TIES CARRIERS TO FASTER SHIPMENTS VIA MEXICO

Four years after proposing an extension of its anti-drug initiative
on ocean shipments to U.S. land borders, the U.S. Customs Service
finalized a plan to expedite the clearance of merchandise, but only if
the trucker or railroad involved is a participant in the program.

That means that at certain major border crossings, some importers may
find themselves no longer able to use the expedited clearance program
known as Line Release.

Customs officially created the Land Border Carrier Initiative Program
when it published its final rule in Monday's Federal Register.
Patterned after the 1984 Carrier Initiative Program that made
steamship lines partners in the war on drugs, the new effort is also a
voluntary program in which carriers work with Customs to close windows
of opportunity that drug traffickers exploit to piggyback drug
shipments onto legitimate cargo movements.

Carriers, for example, would be required to perform criminal
background checks on certain employees, provide adequate fencing and
lighting at their facilities and limit access to authorized personnel.

The rule will eventually affect U.S. carriers once cross-border
trucking is liberalized under the North American Free Trade
Agreement's land transport provisions.

Those provisions were supposed to have been implemented in December
1995, but have been repeatedly delayed due to safety and other concerns.

For the moment, Mexican carriers serve as drayage haulers, or
cross-border transfer companies, that bring all Mexican freight into
the United States. They would therefore be directly affected by the
rule.

The new rule clearly spells out what is expected from motor carriers
for their participation.

While carriers do not have to participate, the theory is they will
want to if they expect to gain business from large-volume shippers.The
rule also explicitly links carriers' participation to importers'
ability to use the Line Release expedited clearance program in defined
"high-risk" areas. Those areas are defined as most major crossings at
the U.S.-Mexico border.

Low-risk importers that have traditionally enjoyed Line Release --
usually major corporations that have demonstrated a high level of
compliance with import laws -- will still be given expedited customs
clearance.

However, in high-risk areas, Line Release will only be allowed if the
company's goods move on a truck or railroad that participates in the
land border carrier program.

High-risk areas where Line Release for importers will be predicated on
participation in the land carrier initiative include the California
border crossings of Calexico, Otay Mesa and Tecate; the Arizona
crossings of Douglas and Nogales; and the Texas crossings of
Brownsville, Del Rio, Eagle Pass, El Paso, Hidalgo-Pharr, Laredo and
Progreso.Although the carrier initiative program did not officially
take effect until Monday, it has already been operating unofficially
because some major Line Release importers have done privately what the
Customs rule requires -- carrier participation as a condition for
getting their business.

FORD SETS THE PACE

"Ford mandated it. Either you were in the CIP (carrier initiative)
program, or you were out," said Rafael Tawil, who runs the drayage
company Enlaces de Transportes Internacionales, the border drayage
carrier of the large Mexican trucker TUM Transportistas Unidos Mexicanos.

Most major Mexican carriers that have drayage companies to get a
trailer to the other side of the border are, or will be,
participating, said Mr. Tawil, noting it is becoming "a way of doing
business at the border in the U.S."

Major U.S. trucking companies that take freight to and from the busy
border with Mexico expect to participate in the land carrier

initiative once the Nafta border opening occurs.

But the program requires control over operations, which U.S. carriers
do not have when freight is in Mexico.

"We couldn't comply. We're not doing anything on the Mexican side,"
said Pete Montano, vice president of sales for Contract Freighters
Inc. of Joplin, Mo.

However, the American Trucking Associations, which was actively
involved in the creation of the proposed and final rules for the
program, feels that when the border opens, there will be participation
by U.S. companies.

NOT TOO DIFFICULT

"I don't think it will be too difficult. The information they're requesting
is not extremely onerous," said Martin Rojas, director of international
affairs for the ATA.

To participate in the motor carrier initiative, carriers must enter
into a written agreement with Customs to adopt internal security
measures and cooperate closely with the agency.

In return, Customs agrees to reduce penalties and administrative
actions if drugs are seized during a conveyance aboard a participating
trucker or railroad.

Like the ocean carrier effort, the land border initiative involves
Customs providing training to carrier employees and drivers about both
cargo and personnel security.

Other training areas include document review techniques, drug
awareness and conveyance search.The idea for a land carrier initiative
emerged in 1995, in part out of vehement criticism of the agency's
border-clearance programs by Sen. Dianne Feinstein, D- Calif., and
other lawmakers.

A notice of proposed rulemaking was issued on Dec. 30, 1997, and the
comment period closed on March 2.

The broad range of comments underscored the difficulty in creating a
rule for border trade, with concerns raised by industry and labor
groups.In addressing the issue of employee background checks, one of
the requirements for participating in the program, Customs said that
only employees involved in physically processing and transporting the
merchandise exported to the United States would be subject to criminal
background checks.

Customs received comments questioning whether the training of railroad
crews might figuratively step on the toes of labor-management
railroad contracts.

In its register notice, the agency countered that since the carrier
initiative is a voluntary program, "Customs finds the issue of labor
agreements between carriers and its employees outside the scope of
these regulations."

WHAT WILL THE UNIONS THINK?

However, that response does not necessarily answer whether certain
rail unions might consider the carrier effort as an infringement on
their collective bargaining agreement.

Customs agreed with its critics that the information collection burden
may be greater than first anticipated, taking as much as two hours a
week in compliance paperwork, especially for large trucking companies
that have high turnover rates for drivers.

Certain privacy questions have also been raised by the
initiative.

Concerns were raised that some criminal misdemeanor offenses like a
drunken driving conviction, which arguably has little to do with
potential drug trafficking, could disqualify a driver from his
company's participation in the carrier initiative.The agency said that
revocation of participation will depend on context, but cases of
drunken driving while on the job would lead to immediate revocation
for the company involved.