In a brief filed on Friday, a senior U.S. customs and border protection officer said shipments from the Bayside facility in New Brunswick, Canada suddenly passed American-sourced seafood. to seafood of Russian origin – three days after the agency hit the operator of the facility. with record fines for alleged violations of Jones Law.
CBP claims that Bayside operator Kloosterboer International Forwarding participated in a scheme to use a bogus “Canadian railway” to circumvent the Jones Act. ASC would ship its fish from Alaska to New Brunswick, Canada, via the Panama Canal – a voyage of over 7,500 nautical miles – on foreign-flagged reefer vessels. At the Bayside terminal in New Brunswick, the fish would be unloaded into freight trucks; driven on a miniature “Canadian railway”; moved about 100 feet; then trucked across the border to Calais, Maine for delivery to the United States.
ASC says this foreign-flagged domestic journey falls under the so-called “third provision” of the Jones Act, which exempts shipments involving a properly documented Canadian railway on “direct routes.” The “Bayside Canadian Railway” is a railway, although it is very small, and it is located in Canada; however, CBP believes that it was not properly documented during the period in question. Additionally, federal attorneys argued that this was not a “through route,” as trucks move up and down the same ramp without making significant progress towards their destination.
On August 16, CBP sent Alaska Reefer Management, Kloosterboer and related parties a long list of alleged Jones Act violations for shipments that passed through the Canadian Bayside Railway. The total potential fines are $ 350 million, including tens of millions of potential penalties for foreign shipowners.
On August 19, three days after the publication of the penalty notices, the US border crossing in Calais, Maine began recording a new type of cargo never seen from Bayside. The same trucking companies that once transported fish caught in the United States from Bayside were now arriving with seafood of Russian origin. Kloosterboer’s name was on the bill of lading and the weight of Russian seafood trucks was the same as when Kloosterboer shipped seafood from Alaska. The next day, seafood shipments from Alaska stopped; the Russian product continued to arrive.
“In the ten years leading up to August 19, 2021, there has been no entry of frozen seafood of Russian origin into the United States through the port of entry of Calais,” said Nicholas Chambers, deputy manager port (APD) of CBP. “The product weight for seafood, per truckload, is equivalent to previous shipments of frozen seafood from Alaska.”
A Kloosterboer official declined to comment on the origin of the Russian shipment and referred the questions to a general media inbox.
In a separate statement, a senior CBP officer testified that to his knowledge no member of CBP had ever visited or approved the operation of Bayside Canadian Railway, either before or after its construction. Previous statements from a witness from Alaska Reefer Management suggested that CBP agents had given the green light during construction of the facility.
“Neither I nor any of the [our] current and former employees are aware of the presence of CBP officers before, during or after construction of the Canadian Bayside Railway. In addition, we cannot locate any record indicating that this inspection took place, ”said Herm Gadway, director of the port of Calais. “It would be very unusual for CBP officers to inspect transport or import operations on foreign soil.