In-transit shipments between destinations in Canada or the US used to be the norm. In the wake of the 9/11 terrorist attacks on the US, however, the borders tightened up significantly, and new security measures came into effect that changed the rules.

What is an In-Transit Shipment?

In an in-transit shipment, the country of origin and the final destination are in the same country (making the shipment technically domestic), but the goods travel through the other country without being offloaded or consumed. Trucking firms can take advantage of this freedom to move goods through Border States where the geography and highway systems would work in their favour. Goods travelling from Toronto to Winnipeg could be driven across the US South of Lake Superior, cutting hours off the trip. Conversely, American companies would take advantage of the shorter route across the North of Lake Erie between Buffalo and Detroit.

Canadian Border Services never changed their in-transit shipment rules, which means that American domestic shipments can still travel freely on Canadian roads (a must for Alaska). Canadian shippers, however, have had to perform complicated record keeping as stringent as the security clearance required for international shipments when shipping to Canadian destinations across the US.

Recently, border officials from both companies hammered out an agreement that will once again allow in-transit shipments between Canadian destinations through the US.

We can expect the changes to be phased in starting in 2015, with a pilot project allowing a limited number of carriers to test the system.

What does this mean to Canadian Transport Companies?

Well, mostly good things. Costs will be reduced by allowing shipments through the US (shorter and better roads, lower fuel prices), but some of the infrastructure that is in place may need to be changed. At Sierra Courier, we expect that the new regulations will increase the demand for warehouse space in Winnipeg, as in-transit shipping will further solidify our position as the “gateway to Western Canada”.