Compliance Verification Trends: Issue #1 – Jan/Feb 2018
The Canada Border Services Agency (CBSA) carries out regular verifications (audits) of import activities in order to ensure compliance with requirements for tariff classification, product valuation and country of origin.
CBSA identifies specific industries and products as priorities for audits, and updates their verification priority list on an ongoing basis. The up-to-date list of priorities is available on the CBSA website.
Forewarned is forearmed
If you import a targeted item, you face a high likelihood of being audited by the CBSA. This in itself can certainly be manageable, provided you’re adequately prepared. However, if you aren’t adequately prepared and the CBSA finds non-compliance, you can be assessed duties, taxes and additional penalties that can harm your business.
Being prepared – both by knowing which goods are being targeted and by ensuring customs compliance when importing those items – gives you the chance to adapt, account for added costs, adjust selling prices and generally lessen impacts to your business.
Target update – January/February, 2018
We have recently seen a number of verifications relating to customs tariff headings 2515.20 and 2516.11 covering rough limestone at a duty-free rate. CBSA is currently targeting these imports to verify if the product was further processed and therefore falling under customs tariff heading 68.02, subject to duty rates ranging from 3.5-8%.
What to do
If you import any of the targeted goods – or think the CBSA could consider your goods to be included in their target list – our audit specialists recommend the following:
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Conduct an internal review to ensure you have accurate and complete documentation for all imports containing targeted goods.
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Provide your customs broker or consultant with detailed technical information on those products, along with copies of any past rulings, verification results or custom opinions.
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Have your broker or consultant perform a detailed review of your targeted imports, supplying both an impact assessment and a recommended action plan.
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If recommended, consider having them submit a voluntary disclosure on your behalf, if the review reveals any errors or omissions, to minimize the impact of penalties.
We can help
Our dedicated Audit Response Unit is staffed by professionals with extensive experience managing customs verifications who keep current on audit trends. They understand the potential risks and costs to a business facing an audit and work with clients to both avoid being audited and to respond effectively if an audit does happen.
Information provided by: Audit Response Unit (ARU) - Cole International
