Creating Lean, Green and Agile Supply Chains: the Benefits of Cabotage Liberalization

Barry Everett Prentice, Erica Vido, Jake Kosior


A significant proportion of offshore trade with North America is carried in 20 and 40 foot marine containers. It would appear logical to use empty international marine containers in domestic service if controlled by a Canadian carrier. Until recently this form of cabotage was restricted by Canadian customs regulations. This paper examines the environmental impact of the cabotage regime on the movement of international containers in Canadian domestic service and how these regulations influenced supply chain efficiencies. The discussion begins with a historical perspective and theoretical underpinning, followed by a comparison of North American container regulations. A review of global reforms and contemporary perspectives on cabotage regulations is provided, followed by a chronology of Canadian container regulatory reform. An economic framework and method of analysis is presented and three case studies are examined to illustrate the environmental and economic impact of a liberalized cabotage regime.


Environment; Cabotage; Containers; Freight

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