Q.We are a USA shipper and have a DRC membership. We shipped an FOB load from Nogales to Montreal and it took 6 days to arrive at destination. The receiver requested a CFIA inspection upon arrival and it was performed same day. The inspection results show 16% total defects. The product was sold under PACA Good Delivery allowing 15% total defects but, in our opinion, because it took six days to reach Montreal, the product should be allowed additional tolerances for defects. Therefore, our product would meet Good Delivery. What is DRC’s opinion on this matter?
A. Jaime Bustamante. We understand that when using PACA’s 5 Day Good Delivery, the tolerance of defects may vary depending on transit time. While PACA may reduce the tolerances of defects on less than 5-day trips, adequate proof needs to be presented as to why an increase of the tolerances of defects on more than 5-day trips. So far, we are not aware of any PACA precedent that has extended the maximum 5-day tolerances. Additionally, this is an international transaction where product left the USA and entered another countries jurisdiction. Therefore, DRC Good Arrival Guidelines apply to the transaction. DRC Good Arrival Guidelines are a combination of PACA 5 Day Good Delivery and Canadian Destination Tolerances and Suitable Shipping Condition. However, DRC Good Arrival only takes into consideration the tolerances of defects based on a 5-day trip regardless of whether the trip takes less or more than 5 days. A case to use lower tolerances can be made for one- or two-day trips to lower the tolerances of defects but, other factors need to be considered for this to apply such as the commodity or mode of transportation.
Part of DRC’s rationale for only considering the 5-day tolerance of defects is based on the fact that we cover international transactions with members located all over the world, where product may take much longer than 5 days to arrive at destination and it would not be fair to extend the tolerance of defects creating a problem for a receiver to market product with far more defects.
While we do not have all of the details for the transaction described in the above-noted question and assuming normal transit time and temperatures occurred, based only on the information provided, the product would have failed to meet DRC Good Arrival by 1%.