Crossing The Border: Mexico
U.S.-Mexico border opening will takemore time.
Oliver B.Patton
Washington Editor
It has been more than a year since the Supreme Court cleared away the last legal barrier to long-haul trucking across the U.S.-Mexican border. So why is the border still closed?
The quick answer is that the U.S. and Mexico have not yet agreed on the details of reciprocal access. The North American Free Trade Agreement set forth the general terms of the opening, and Congress and the Federal Motor Carrier Safety Administration followed up with laws and regulations, but there will be no opening until both sides agree on exactly how things will work.
And that, apparently, is not likely to happen any time soon.
As far as the U.S. is concerned, the ball is in Mexico's court, said a senior official at the Department of Transportation. After the Supreme Court decision, DOT told Mexico that it can't implement the opening unless it has assurance from Mexico that implementation will be reciprocal – that is, as the U.S. grants authority for Mexican carriers, Mexico grants authority for U.S. carriers.
"At this point Mexico has been silent on exactly how that might be accomplished," said the official, who did not want to be identified by name. "We are basically waiting to hear from them on how we might move forward."
Mexico may not see it the same way, however. For example, there is a feeling among some Mexican fleets that the regulatory scheme put forward by the U.S. is not exactly even-handed, according to a U.S. trucking executive based in Mexico City.
"The sentiment among Mexicans is that U.S. safety enforcement is exaggerated and not fair," said Armando Beltran, general director of Schneider National de Mexico.
In a sense, this feeling actually represents an advancement among Mexican truck operators, Beltran indicated. When the NAFTA process began 10 years ago most Mexican carriers were flatly opposed to the opening, but now many have come to believe that the opening is inevitable and desirable – provided the rules are fair and equal.
The Mexican concern about fairness is bound up with the belief of some operators that an open border will introduce competitive pressures that will force changes in the way business has been done, Beltran said. This pressure comes more from domestic owner-operators who comprise some 90% of Mexico's trucking industry, he said.
On the other hand, many of the larger Mexican fleets are ready to roll. "A lot of those fleets could compete – they are as good or better than U.S. fleets in terms of technology, business processes and equipment," Beltran said.
An additional complication is the political climate in Mexico. "Right now we are immersed in a highly political time," Beltran said, referencing the presidential elections that are scheduled for next July.
THE SAFETY REQUIREMENTS
Under NAFTA, Mexican carriers who meet U.S. safety standards will be able to deliver freight to destinations throughout the U.S. and take loads back to Mexico, but they will not be permitted to haul freight between U.S. points. U.S. carriers will have reciprocal rights in Mexico.
The safety requirements that are giving Mexican carriers pause are the product of fierce debate in Congress, and considerable effort by FMCSA, and the U.S. has no intention of changing them.
Their fairness is a matter of opinion, but here's what they say.
U.S. safety inspectors must conduct a home-base safety exam at half of the Mexican fleets of four trucks or more that are applying for U.S. authority.
The exam must verify that the Mexican company meets U.S. standards for maintaining performance data and a safety management, including drug and alcohol testing and hours of service. It also must verify insurance coverage, driver qualifications and operating history. It will include an interview with company management, and it must verify the company's maintenance system.
If the company passes the safety exam, it gets a conditional operating authority for 18 months. In that period, the agency will conduct a full-fledged compliance review, before the company can get permanent authority. Half of the compliance reviews must take place at the Mexican home base, with the stipulation that companies that did not get onsite safety exams must get onsite compliance reviews.
There is ample precedent for this sort of international inspection. Martin Rojas, executive director of safety, security and operations at American Trucking Assns., explained that U.S. agriculture inspectors routinely go into Mexico, and Mexico has inspectors who come into the U.S. to check on conditions for agricultural workers.
In fact, the diplomatic protocol for U.S. truck safety inspectors to enter Mexico has been written out, Rojas said. What's missing is the signatures.
There are additional safety requirements, once a Mexican fleet is cleared to enter the U.S. While they are operating under conditional authority, all long-haul Mexican trucks will have to display a valid Commercial Vehicle Safety Alliance sticker. CVSA sets cooperative truck inspection standards in the U.S., Canada and, now, Mexico. Mexican carriers will have to maintain the CVSA clearance for 36 months after they get permanent authority.
When a Mexican driver comes to cross the border, he must document his schedule for the prior seven days to prove he is adequately rested. In the U.S., he must abide by U.S. hours of service rules. Mexican drivers must have a Licencia Federal, the Mexican equivalent of a U.S. commercial driver's license.
Inspectors in both countries can access federal and state databases in the U.S. and Mexico to check a driver's license. They will verify the licenses of all long-haul drivers pulling hazmats or undergoing a full CVSA inspection. They will verify the licenses of half of all other long-haul drivers.
All trucks crossing the border will be weighed. Each Mexican carrier will get a DOT number. And Mexican trucks can only cross where and when a safety inspector is on duty.
And now, under a provision of the new U.S. highway funding law, Mexican (and Canadian) drivers who haul hazardous materials will have to clear a security background check "similar" to the requirement for U.S. hazmat drivers. The Transportation Security Administration has six months come up with the program, and may extend that deadline for up to another six months.
Armando Beltran likes the rule. "It's absolutely the right thing to do," he said.
Some Mexicans will see it as an opportunity, he said, but others will struggle with the cost. He believes it would be useful for the U.S. government to step forward with support to make it easier for Mexican drivers to comply.
BACKGROUND
The force that is driving this situation is international trade. Trucks carry more than 80% of the trade between the U.S. and Mexico – trade that totaled almost $267 billion in 2004, according to U.S. Department of Commerce figures.
Right now, that freight does not move very efficiently. Most cargo into and out of Mexico has to be interlined, using third-party drayage operators to shuttle trailers from one side of the border to the other.
This complex and inefficient system was targeted by the 1993 North American Free Trade Agreement, which stipulated that the border would open to border-state traffic in 1995 and to long-haul traffic in 2000.
Neither of those deadlines were met, due to fierce opposition from U.S. labor unions concerned about free trade and possible loss of jobs. While Bill Clinton was president, labor interests were able to keep the border closed by arguing that Mexican trucks are not safe, and that the U.S. had no way to ensure that they would be safe.
President Bush, early in his term, broke through the jam by insisting that the U.S. would implement the NAFTA provisions. It took two years to create a comprehensive new regulatory scheme to ensure the safety of Mexican trucks.
Another delay ensued when a group of labor and environmental interests, including the Teamsters union and the California Trucking Assn., sued to stay the FMCSA safety regulations on grounds that the influx of Mexican trucks would substantially increase diesel emissions. That suit was upheld by a lower court but reversed by the Supreme Court in June of 2004, clearing the last legal barrier to the opening of the border.
OTHER ISSUES
In the absence of an open border, trucking interests north and south of the border have worked out arrangements that keep the freight moving. Schneider National de Mexico, for example, provides service in most of Mexico through partnerships with established Mexican carriers.
NAFTA's promise of reciprocal ownership rights has not been fulfilled, however. Under the agreement, a Mexican citizen may control an international freight transport company based in the U.S. But a reciprocal right for U.S. citizens, which was scheduled to take effect in 2004, probably will not be granted until the border opens, said Washington transportation attorney Ken Siegel.
Armando Beltran of Schneider said the foreign investment issue is one of the keys to getting the border open. Mexico needs to be more clear: "The law might be clear but the regulations are not," he said. "Some operations are not set up appropriately."
Also in play are environmental requirements, and size and weight regulations.
Beltran said the Mexican government is trying to decide whether it should hew to U.S. or European emission standards, and the Mexican community is split on sizes and weights. For-hire carriers tend to want lower limits, while private carriers want more. His own opinion is that Mexican standards need to be congruent with U.S. standards, since the point is to build a North American market.
For businesses engaged in trade across the border – shippers as well as carriers – the continued closure is only one problem. The inefficiency of the current system is compounded at some border crossings by redundant security and safety checks, said Maria Luisa O'Connell, president of the Border Trade Alliance, a non-profit that promotes North American trade.
In Texas, she said, trucks coming across the border are stopped three times by three separate entities: U.S. Customs, the Texas Department of Public Safety and FMCSA.
"That's unacceptable from our point of view," she said.
O'Connell's theme is better communication: The U.S. agencies need to coordinate their screening activities.
This echoes Beltran's view that the key to getting the border open is better communication – between Mexico and the U.S., and among carriers.
The U.S. may say the ball is in Mexico's court, but from where Beltran sits the ball is still in play for both sides.
He said both sides have the right intentions. He praises the Bush administration's commitment to opening the border, and adds: "Mexican fleet owners and shippers are very open to improving the situation."
Here's the U.S. position: "All I can tell you is that this remains an active issue on the part of (DOT)," said the senior DOT official. "It remains an active issue from the perspective of SCT, our Mexican counterpart, as well as the two trade offices. It has not fallen off the radar screen. It continues to be looked at, it continues to be reviewed, it continues to be discussed with the common objective of trying to get the planets to align properly and make this happen."
Said Armando Beltran, "The opening is inevitable. The only question is how do we get there."
No one is willing to guess how long it will take. "Progress," Beltran said, "will come in increments."
