---
title: Customs Rulings and how they work!
description: A customs ruling is a written decision by a customs authority that provides certainty to an importer on key information relating to an imported good. It makes the import process easier and more predictable by assuring both the importer and the customs authority that taxes, duty and other obligations will be handled correctly.
image: https://blog.coleintl.com/hubfs/knowledge_is_power_30221152_s.jpg
---

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### Request Info

# Customs Rulings and how they work!

 Published: March 6,2019

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<iframe id="vp1RJ0yO" style="margin: 15px 0px 15px;" title="Video Player" xml="lang" src="https://s3.amazonaws.com/embed.animoto.com/play.html?w=swf/production/vp1&amp;e=1552943464&amp;f=RJ0yOtRtEhikXbjdWQdsOw&amp;d=0&amp;m=p&amp;r=360p+480p+720p&amp;volume=100&amp;start_res=720p&amp;i=m&amp;asset_domain=s3-p.animoto.com&amp;animoto_domain=animoto.com&amp;options=" width="544" height="306" frameborder="0" allowfullscreen></iframe>

There's a lot to know about moving goods across the border. The customs landscape—riddled with complex processes and mired in legalese and industry lingo—can be perplexing and frustrating. Nevertheless, importers need to do it right—by knowing their roles and responsibilities and, sometimes, by seeking professional support.

**What is a customs ruling?![knowledge\_is\_power\_30221152\_s](https://blog.coleintl.com/hs-fs/hubfs/knowledge_is_power_30221152_s.jpg?width=300&name=knowledge_is_power_30221152_s.jpg)**

 

A customs ruling is a written decision by a customs authority that provides certainty to an importer on key information relating to an imported good.

 

A customs ruling makes the import process easier and more predictable by assuring both the importer and the customs authority that taxes, duty and other obligations will be handled correctly. It can be just the ticket to keeping customs happy. And keeping a positive relationship with customs benefits everyone. 

 

Both Canadian and U.S. customs issue rulings Since you may be importing into Canada or the U.S., you should know that both countries’ customs authorities provide their own customs rulings and that they vary in a few ways. In Canada, the CBSA issues ‘advance rulings’ (four different types) and in the U.S., CBP issues ‘binding rulings’ (six types).

 

**In Canada…**

 

Advance rulings, issued under paragraph 43.1(1)(c) of the *Customs Act*, provide information on the importation of particular goods, including their 10-digit tariff classification number under the Canadian Customs Tariff. The advance ruling ensures that the tariff classification number used is deemed correct by the CBSA. The ruling is binding until revoked or amended.

 

CBSA provides this [refreshingly readable explanation](https://www.cbsa-asfc.gc.ca/import/ar-da/menu-eng.html) on advance rulings. There are four different types.

- A national customs ruling outlines how provisions of existing customs legislation apply to imported goods
- An advance ruling on tariff classification defines the category for applying the tariff, tax and/or duty on an imported product
- An advance ruling on origin defines the country of manufacture, production, or growth where an article or product comes from
- An advance ruling on valuation defines a product’s value that is used to assess the amount of import duty and other taxes owed

 CBSA publishes their past rulings on tariff classification, origin and valuation in a [searchable online repository](https://www.cbsa-asfc.gc.ca/import/ar-da/ar-da-eng.html) that is a good reference for importers seeking their own rulings or who think it may be worthwhile for them to request one. Note that rulings are binding only between the CBSA and the applicant and the published rulings are provided for reference only.

 

**In the U.S…**

 

Customs rulings are binding administrative decisions issued by U.S. Customs and Border Protection ([CBP](https://www.cbp.gov/)) pursuant to 19 C.F.R. Part 177. Rulings may address customs related matters including United States tariff classification, marking, and valuation. CBP may issue such rulings to any importer or exporter of merchandise; to any individual or business entity that has a direct and demonstrable interest in the matters or questions presented in the ruling request; or to an agent (such as an attorney) of either of the aforementioned parties. Rulings may only be prospective and in response to a ruling request.

 

CBP rulings may be requested for valuation, carrier, tariff classification, certain marking, origin or NAFTA and trade program applicability. Most types of request can be made by letter or electronic submission.

 

CBP provides a searchable database of its past customs rulings—the [Customs Rulings On-Line Search System](http://rulings.cbp.gov/). For more info, there’s also CBP’s [Customs Bulletin and Decisions](https://www.cbp.gov/trade/rulings/bulletin-decisions).

 

**The Process**

 

To apply for a customs ruling, the Importer of Record must submit a request to the pertinent customs agency, either in writing or electronically. Each agency outlines what information the submission must include—and what formats are acceptable. The customs agency typically processes a customs ruling request within four months.

 

**The Benefits**

 

- Improved customs compliance. Customs rulings provide clarity, eliminating the potential for accidental non-compliance.
- Improved transparency with customs. Requesting a customs ruling demonstrates an importer’s commitment to due diligence in their compliance practices, mitigating against audits, penalties and interest.
-  Save money. Get it right the first time and have no surprise costs at the border. Also, some customs rulings result in the classification of goods as duty-free, even retroactively—up to four years before the date of accounting.

Without such certainty, there’s a looming possibility of noncompliance—and all its attenuate risks (such as seizure of imported goods, penalties and other nasty things) that nobody wants.

 

**We can help**

 

Cole has been in the [customs consulting](https://www.coleintl.com/trade-consulting.php) business for decades and has built solid relationships with customs authorities along the way. Working with a customs professional can make the process quick and painless.

 

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