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Is your import business at risk? How to tell (and what to do about it)

What kinds of risks are there?

We recently covered the opportunities available for importers. Now it’s time to dig into the potential risks. Risks in import businesses fall into four categories:

  1. Risks associated with Customs regulations, which include: errors on declarations to Customs, restrictions, permits, or other requirements you may not have met
  2. Risks related to the Special Import Measures Act (SIMA), and
  3. Compliance-related risks
  4. CBSA verifications

Let’s take a closer look at each of these.

Regulations, restrictions, and permitsContainers_74484015_s

Importers need to determine whether their goods are subject to Customs regulations, which include restrictions and permits.

The CBSA's Other Government Departments and Agencies: Reference List for Importers provides a list of some of the most commonly imported commodities that may require permits and/or certificates. 

More comprehensive information can be found in Memoranda Series D19, Acts and Regulations of Other Government Departments.

Special Import Measures Act (SIMA)

Certain goods are subject to measures under the Special Import Measures Act (SIMA), including anti-dumping duties, countervailing duties, and undertakings. 

Consult the monthly index of products subject to SIMA  to see if your goods are included. Refer to Memoranda Series D14, Special Imports Measures Act and D15, Special Import Measures Act – Investigations for more information.

Compliance risks

To be or stay in compliance, you’ll need to correct any errors in the accounting of goods within 90 days of “reason to believe.” Or, past 90 days, an approved voluntary disclosure program application (VDP) can ensure compliance without the risk of penalties.

CBSA verifications

CBSA conducts verifications (or audits) for value, origin, and tariff treatment for importers.

To level the playing field, verifications target a variety of criteria. Large and small importers are equally at risk of being chosen for compliance verification. 

An importer chosen for a CBSA verification may be at risk if they don't have a compliance program. Penalties and additional duties and taxes may be assessed for non-compliance.

Stay abreast of CBSA verification trends in our blog series.

Addressing and mitigating risk


To mitigate Customs risk in your business, conduct self-audits of the procurement to payment process by comparing your accounting documents to your import documents, including:

  • Commercial invoices
  • Payments to foreign vendors
  • Certificates of origin
  • B3 Canada Customs coding statements

Verify that the value, country of origin, tariff classification, and tariff treatment have been declared correctly.  

Also, any payments to vendors for goods should match the declared value at the time of import, considering any required additions or allowable deductions to the value.

Compliance programs

The best way to identify and address risks is to set up an internal compliance program to review the import requirements and obligations, and ensure the proper record-keeping processes are in place.  

Additional costs for duties and taxes, and penalties for non-compliance can be detrimental—so, a properly structured compliance program may significantly reduce the impact by identifying issues and making the required corrections prior to a verification.

Set up a compliance program if you have access to a resource with good knowledge of compliant import procedures.  

Compliance support

If you lack dedicated resources to implement and manage compliance, partnering with a service provider that specializes in customs compliance would be advisable.

Experienced compliance professionals are well-versed in risks, requirements, documentation, and best practices to achieve and maintain compliance.

Is it time to tighten up your systems for better customs compliance? With more than 60 years of risk management experience, connect with our team of consulting professionals today.

Risk Management. It's what we do.

Contact us today!

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