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Importing into Canada: Customs-related issues facing Canadian importers

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The rapidly changing and complex trade regulations have created consistent customs-related concerns among Canadian importers. Canada is a trading nation that has put in place many programs that determine what and how business can import to ensure security, health, and safety of its citizens while facilitating legitimate trade. Implementation of trade programs is a growing pain that is being felt by many Canadian importers. Here are a custom related issues facing importers in Canada.

Origin preferences
The North America Free Trade Agreement provides significant duty reliefs to importers. Origin-based duty relief opportunities are beneficial to importers who take their full advantage. Importers who are unaware of such benefits face significant duty outlays that impact their bottom line.

Importers are required to provide valid and complete documentation while following the rules of origin to take advantage of origin-based duty relief opportunities. Failure to manage and properly apply for preferential origin-based duty treatment leave importers with significant duties and subjects to significant compliance-related costs.

Transfer pricing adjustments
Canadian customs valuation of imported goods is subject to periodic transfer pricing adjustments. Significant penalties face importers who fail to report upward and downward adjustments to customs.

Other government department regulations(OGD)
They include import permits, energy consumption guidelines, food safety requirements, hazardous goods and other requirements related to imported goods. Importers often face product seizures, penalties, and fines on imported good that do not meet all applicable requirements and regulations.

Importers incur a lot of costs hiring customs brokers to ensure that goods are compliant with the required regulations. Goods may also become subject to delays which directly impact the bottom line and the reputation of an importer.

Custom compliance
According to customs clearance in Canada, importers are the liable party for compliance with OGD regulations and customs. This means that when a third party service provider such as a customs broker and PARS checkers failure to comply with all customs related regulations, any resulting fines, seizures, penalties will be at the expense of the importer.

The use of third party service providers does not shield an importer from non-compliance costs. The legal implication associated with customs compliance could lead to civil and criminal prosecution.

Special Import Measures Act
Under this act, imported goods can be subject to additional duties under the special Import Measures Act. The extra duty is imposed to fight unfair trade. These measures are put in place to fight acts such as dumping.

The Canadian economy largely relies on its importers and exporters. Other than custom rules and regulations, importers have the added burden of supply chain issues that range from varying transportation infrastructure capabilities to international financing strategies. To maintain the country’s position as a strong global economy, high standards to the import process must be applied.