Cross-border Trade Seminar: Doing Business in the USA


Doing Business in the USA

A weak loonie makes U.S. sales more valuable.  Learn from trade experts on how to remove border barriers, take advantage of the exchange rate and earn up to 20% extra on your U.S. sales. This comprehensive seminar is designed to give Canadian manufacturers, importers, exporters, distributors, and other business professionals the tools they need to easily expand their business across the border into the USA. Together, a group of seasoned Canadian, American and international trade experts will provide practical guidelines to entrepreneurs and professionals at this one-day seminar.

Discuss your own specific needs, plans and opportunities when you meet with our expert speakers and resource people during the one hour Round Table Session.

Key topics include:

  • U.S. Commercial Real Estate
  • Canadian Government Programs and Services
  • U.S. Sales and Marketing Strategies
  • U.S. Banking and Financial Services
  • International Insurance Strategies
  • U.S. Travel and Immigration Planning
  • U.S. Business Planning and Taxation
  • U.S. Business Formation and Legalities
  • Canada and USA Distribution and Logistics
  • U.S. Customs and NAFTA Guidelines

Download a complete event agenda here.

Who should attend?

Canadian importers and exporters, manufacturers, distributors and business professionals interested in expanding their business across the border into the USA.

Event Details:

  • Date: Thursday, May 7, 2015
  • Time: 8:00 am – 4:00pm
  • Place: Delta Town and Country Inn, 6005 Highway 17A (at Highway 99), Delta, BC
  • Cost:
    • $195 pre-registered;
    • $225 at the door;
    • $145 group rate for 2+
    • Early birds save $25 if registered on or before May 1st, 2015
  • Registration: https://crossborderseminar1505.eventbrite.com
  • Contact:  Carol Jackson at 1.800.799.8848 or visit www.UCanTrade.com

Presented and Sponsored By:

  • Greg Boos, USA Immigration Attorney, Cascadia Cross-Border Law
  • Rob Gilfillan, Int’l Sr. Tax Manager, Moss Adams LLP, CPAs
  • Gene Moses, USA Business Attorney
  • Jim Pettinger, President, International Market Access, Inc.
  • Lou Kaszubski, U.S. Licensed Customs Broker, Pacific Customs Brokers Inc.
  • Roland King, Senior Vice President, Banner Bank
  • Corky Boozé, Broker, Sterling Real Estate Group
  • Grant Gilmour, Partner, Gilmour Knotts, CAs
  • Dave McFarlane, Managing Director, Business Development, HUB International
  • Canadian Trade Commissioner Service
 
 

Six Methods of Determining Customs Valuation


valuationMany importers are uncertain of how to properly declare the value of their goods when importing into Canada, partly due to the many rules and factors to be considered when determining valuation. With an expectation to be compliant, valuation is one of the three main targets for a CBSA audit. Unfortunately, importers spend the least amount of attention to this area. Valuation can be an intricate area to navigate if your foreign purchases involve situations which could change the declared value to Canada Border Services Agency.

 

What is valuation?

Valuation is the determination of the correct value of goods being imported and declared to the Canada Border Services Agency. CBSA requires all goods imported into Canada have a value for duty which is the base figure on which an importer calculates the duty and taxes he/she may owe the CBSA on their goods.

Irrespective of circumstances in which duties and taxes may not be owed, for example, in the importation of samples, replacements, warranty items, short-shipped goods, etc., an importer is still required to declare a fair market value of the goods based on one of the six methods of valuation.

Six Methods of Determining Customs Valuation

Methods of valuation

There are six methods of customs valuation identified in the Customs Act. An importer has to consider these methods in sequence.The requirements of each of these methods are based on the rules in the World Trade Organization’s Valuation Agreement. These rules ensure imported goods are valued in accordance with commercial reality, and they prohibit the use of arbitrary or fictitious customs values.

  •  Transaction Value

The transaction value method is the most commonly used valuation method. It applies when goods are sold for export to Canada to a purchaser in Canada. Under this method, value for duty is based on the price paid or payable for imported goods with consideration to certain adjustments.

- Price paid - is the total of all payments made directly or indirectly by the purchaser to the vendor.

- Price payable - is the total of all payments that are owed and will be made directly or indirectly by the purchaser to the vendor.

You have to use the first of the six methods, the transaction value method, whenever possible to determine the customs value of imported goods.

  •  Transaction Value of Identical Goods

Identical goods are the same in all respects as the goods being appraised, except for minor differences in appearance that do not affect the value of the goods. In order to qualify, the goods would have to be produced in the same country as the goods being appraised.

  • Transaction Value of Similar Goods

 Using this method, the value is based on goods which closely resemble the goods being appraised. In order to qualify, these goods must be capable of performing the same function, be commercially interchangeable, and be produced in the same country and by the same manufacturer as the goods being appraised.

  •  Deductive Method of Valuation

If none of the above methods apply, the deductive value method is the next method to consider. This method is based on the Canadian importers most common selling price per unit of the goods to Canadian customers of the goods being appraised.

  • Computed Method of Valuation

The computed value is the cost of production of the imported goods, plus an amount for profit and general expenses realized by producers in the exporting country when selling the same type of goods to Canadian importers.

  •  Residual Method of Valuation

The residual method does not identify specific requirements for determining value for duty. Instead it is value based on one of the other methods (considered in sequence) and requires the least amount of adjustment. The value must be fair market, and reflect commercial reality.

 

In the end, the final value for duty can also be influenced by:

  • The relation between the parties involved.( i.e. a related buyer and seller)
  • Condition where the goods were provided to the Canadian consignee at no charge (i.e. consignment)
  • Allowable additions or deductions to the value of the goods
  • Used goods
  • Goods that were not sold into Canada (ie. for rent or for lease)

 

If you have reason to believe that you have valuation situations which have the potential to raise flags during an audit, please give us a call to discuss this further.

Interested in learning more about about the methods of valuation and why it’s important to get it right? Join us for our upcoming webinar on Importing for the Beginner-Canada [Part 2]. Our in-house seminar on Canadian Customs Compliance is another great way to understand valuation.

Have questions about valuation? Use the comments section below to leave us your thoughts or email Ask Your Broker.

 
 

Canada Customs Invoice: 7 Mandatory Fields


Filling out a customs form A Canada Customs Invoice (CCI) is required for all shipments entering Canada that are valued over $2500.00 CAD. Do not take the risk of delaying your shipment at the border due to an incomplete or inaccurate Canada Customs Invoice (CCI).  Customs brokers see this happen often.

Mandatory Fields on a Canada Customs Invoice:

The following fields on a Canada Customs Invoice are mandatory for customs clearance, and must be provided at the time of release:

1. Date of Direct Shipment – This is the date the goods have left the place of direct shipment. This is used to obtain the exchange rate which will be used to convert the value for duty into Canadian dollars. Exchange rates vary day to day, which makes it very important to indicate the correct date of shipment on your invoice.

2. Country of Origin – This field must indicate the country where the products originated from or were manufactured. This will not necessarily be where the products were exported from. The country of origin will help determine if we can apply a trade agreement to lessen the duties applicable on the products being imported.

3. Currency of sale – This should indicate which funds were used to purchase the goods. This should never be left blank or assumed. Your customs broker must convert funds to Canadian dollars in order to file an entry with Canada Customs; this makes it very important to know which funds we are working with.

4. Quantity – This field should indicate the total number of pieces being shipped. If Customs examines a shipment, they will want to ensure that the number of pieces declared matches what is loaded on a truck. This makes it very important to ensure accuracy.

5. Value – This field should indicate the fair market value of the goods. This is required for all goods being imported – even if a sale has not occurred. Valuation of the items being imported should be based on one of the six valuation methods: transaction value of the goods, transaction value of identical goods, transaction value of similar goods, deductive method, computed method, or residual method.

6. Weight – This must indicate the weight of the goods. This should match up with the carrier’s bill of lading weight. This can also be used to verify accuracy in the case of a Customs examination.

7. Purchaser/Importer of Record – This field should indicate which party has purchased the goods. It will identify which party is responsible for handling the customs clearance, any duty, and accountable for any duty and taxes that are payable on the items being imported.

Snapshot - Sample Canada Customs Invoice

 

Here is an example of a properly completed Canada Customs Invoice. Click the link or the thumbnail image for a detailed view.

Sample Canada Customs Invoice Form

 

 

 

 

Interested in learning more about about documentation for importing into Canada? Pacific Customs Brokers hosts a series of Trade Compliance Seminars throughout the year. To learn more about this topic, we recommend attending an upcoming Canadian Customs Compliance Seminar.

Do you need additional assistance with your customs documentation, contact Pacific Customs Brokers.

Have questions on filling out a Canada Customs Invoice?  Ask us in our comments section below.

 
 

Wood Packaging Materials: 5 Tips to Avoid Shipment Refusal


wood-palletsWe have posted a few articles about the increase in U.S. Customs refusal of import shipments due to non-compliance with the wood packing material regulations, containing everything from perishable food products to floor tiles to machinery to textiles. This remains a topical subject, and while Customs has not officially published the exact numbers, U.S. Customs and Border Protection (CBP)  issued thousands of Emergency Action Notices in 2012 nationwide, with many of those being at the U.S.-Canada border. With very rare exceptions, these shipments have required immediate re-export. No recourse and no options for further mitigation or treatment are being offered at this time.

It is estimated that the U.S. spends about $138 million dollars each year fighting the effects of invasion by non-native species, which includes plants and seeds, as well as animals and insects. While CBP (U.S. Customs and Border Protection) and the USDA (United State Department of Agriculture) have been waging this battle for a number of years, there is a definite increase in the number of inspections taking place and the severity of required actions over the course of the past couple years. The International Plant Protection Convention (IPPC) regulations regarding wood shipping material (ISPM 15) went into effect in 2005. Since then, all wood packaging material (WPM) entering the U.S. must be either heat treated or fumigated according to these regulations. We want to be clear that the recent increased levels of inspection and refusal are not due to any new requirements, but rather more focus and increased officer training regarding this important issue.

Wood packaging materials must not only be appropriately treated and have certification issued, but if an inspection is ordered and the officer finds reason to question the validity of the stampings or documentary statements, Customs has the right and the responsibility to refuse the shipment.

This is a list of a few of the scenarios that have come to our attention recently:

  1. Cargo arrives at the port of entry with a mix of marked and unmarked WPM. No assumptions will be made by Customs as to the origin or status of the packing materials and the entire shipment will be refused and ordered for immediate export.

  2. When goods are delivered from overseas to a warehouse, the packaging is certified and appears clean. By the time it is shipped to the U.S., however, an uninvited rodent set up house in the warehouse. Even if the WPM is marked & certified, it will be rejected – likely for noxious weed seed – and refused, with immediate export demanded.

  3. The WPM is all certified and marked appropriately, but the Customs officer finds evidence, or even a question of evidence – say frass, or fresh boreholes – that it may have been re-infected, or possibly the initial treatment was not effective, or the marks and certification were fraudulent. You guessed it – the shipment is refused and immediate exportation is ordered.

  4. The WPM is certified and marked, but the Customs officer finds evidence that the WPM is concealed in some fashion – hidden between plys, or possibly an unmarked piece of bracing material. Once again, the shipment is refused and immediate export is ordered.

If your cargo is carried as a less than truckload (LTL) shipment, it may be consolidated on a truck or in a container with other shipments. If one shipment in that lot is found to be non-compliant, it is very likely that everything on that truck or container will be refused and sent back to origin. Who bears the costs involved? Every carrier makes their own decision on this, so you will want to address this issue with your client.

Clearly, the costs of having a shipment refused at the border can be tremendous. Between all of the necessary documentation, inspection fees and communications, wait time, a wasted trip to the border and return, re-import process, repacking the shipment and sending it again – possibly late this time, or the risk of having an angry customer who no longer wants the product, not to mention possible penalties issued at a later date by U.S. Customs for non-compliance… no wonder you have a headache!

So, here are a few suggestions on what can you do to lessen the likelihood of being caught up in this scenario:

  1. Make sure that your warehouse personnel and your vendors know, understand and follow the regulations on WPM – the USDA-APHIS website is a good starting place to look for more in-depth information.

  2. As you load your shipments destined for the U.S., look at it like a Customs officer will: is the shipment packed so as to be easily examined? Are all pallets and crates clearly and appropriately stamped? How about dunnage, bracing and loose packaging – are they stamped? Know the signs of infestation – bark, frass, boreholes, live insects or larvae. Is there any evidence of pest infestation on the packing? Make sure the pallets are clean and clear of rodent debris, unintended soil or plant/seed material, and any other unwelcome pests.

  3. If you are building your own crates or packaging materials, you must use materials from a registered and accredited manufacturer, and have the final packing material treated appropriately. You cannot create your own ISPM15 marks.

  4. Implement processes and policies for shipments being returned due to non-compliance, particularly if you are hauling LTL loads. Be prepared with a plan of action, and remember that shipments cross the border and are examined 24 hours a day, 7 days a week at some ports, so it is a good idea to advise your Customs Broker of after-hours contact instructions.

  5. Stay in close communications with your Customs Broker regarding updates and/or changes in the regulations, and know how these changes might affect you and your cargo destined to the U.S.

Pacific Customs Brokers can help advise you on how to better your chances of success with Wood Packaging Materials compliance. We can provide you with helpful information to avoid delays and refusals and manage the entire Customs process seamlessly.

Have questions about Wood Packaging Materials? Leave them in our comments section below.

 

 
 

March 19: Breakfast with U.S. Ambassador to Canada, Bruce Heyman


Advancing Shared Priorities: A Conversation with U.S. Ambassador to Canada Bruce Heyman

Moderated by Global National’s Weekend Anchor and BC Correspondent Robin Gill

The American Chamber of Commerce – Pacific Chapter is proudly hosting the U.S. Ambassador to Canada, Bruce Heyman for a breakfast event on March 19, 2015.

  • Speaker: Bruce A. Heyman, U.S. Ambassador to Canada
  • Moderator: Robin Gill, Global National’s Weekend Anchor and BC Correspondent
  • Date: Thursday, March 19, 2015
  • Time: 7:00 AM-9:00 AM
  • Place: Hyatt Regency
  • RSVP: events@amchampacific.com or 855.542.6623
  • RSVP Deadline: Friday, March 13, 2015
  • Cost:
Individual Seats:
Members:$75
Affiliate Members:$100
Non-members:$125
Tables of Eight:
Members:$550
Affiliate Members:$750
Non-members:$950

RSVP Now »

 

US Ambassador Bruce Heyman

About Ambassador Bruce A. Heyman

Bruce Heyman was sworn in as President Obama’s personal representative to Canada on March 26, 2014, after having being confirmed by the United States Senate on March 12, 2014.  He is a 33 year veteran of Goldman Sachs, where he served as the managing director of the Private Wealth Management Group from 1999 until December of 2013.

Mr. Heyman has served as a board member for the Chicago Council on Global Affairs and the Northwestern Memorial Hospital Foundation.  He also served as an advisor to the Fix the Debt CEO Council of the Committee for a Responsible Federal Budget.  He has been a member of The Economic Club of Chicago, The Executives’ Club of Chicago, and the Facing History and Ourselves Chicago Advisory Board.

A magna cum laude graduate with both a BA and an MBA from Vanderbilt University, Mr. Heyman continues to maintain close ties to his alma mater.  He is past president of the Alumni Board and a former member of the Board of Visitors at the university’s Owen Graduate School of Management.

He is married to the former Vicki Simons of Ashland, Kentucky.  They have three grown children, David, Liza, and Caroline, and two grand-children, Emma and Clara.

 

RSVP Now »