How to Process Unique Shipments When Filing ACI eManifest


Unique Shipment Processes are not exempt from pre-arrival data and have reporting and pre-arrival requirements which are different in some manner.

Here is a quick list of these processes:

Courier Low Value Shipment (LVS) / High Value Shipment (HVS)

These shipments are exempt from pre-arrival cargo reporting. Conveyance pre-arrival data transmission is still required, quoting the appropriate cargo exception code.

High Value Shipment (HVS)

Goods Found Astray (Misrouted Goods)

Foreign goods found astray in Canada must be electronically transmitted post-arrival as soon as they are discovered by the carrier and then exported and reported to CBSA as per D3-1-8, Cargo-Export Movements

Goods Found Astray (Misrouted Goods)

Overages

Any excess in the number of pieces transmitted to CBSA in the same shipment and found by the carrier post arrival are overages and must be reported to CBSA as soon as they are discovered by transmitting an amendment to the cargo transmission. An overage can only be corrected post arrival without penalty if the goods were reported to CBSA initially pre-arrival.

Shortages

Shortages

Like overages, shortages can be corrected for goods initially reported pre-arrival and subsequently the carrier found that the number of pieces found was less than the number of pieces reported. Again carriers are to report shortages as soon as discovered to CBSA and are to transmit a post-arrival amendment to the original cargo transmission.

Shortages

Personal Effects

When personal effects are imported into Canada by a carrier, the name and address of the actual consignee is required. The name of the moving company is to be provided in the NOTIFY PARTY field of the eManifest transmission.

Personal Effects

Single Trip Authorizations

Carriers using a single trip bond are required to electronically transmit pre-arrival conveyance and cargo data to CBSA showing First Port of Arrival (FPOA) as the port of destination. Once the carrier arrives in Canada, the driver must present a paper A8A with a different CCN on it. The driver will be referred to a customs broker or agent for security or bond application. Once secured the bond application and A8A will be presented to CBSA at the FPOA. CBSA will acquit the electronic cargo with the in-bond CCN (re-manifest) and the cargo will be permitted to proceed inland on the paper A8A.

Single Trip Authorizations

One Conveyance – Multiple Trailers – One Shipment

Where one shipment is carried on two or more trailers but hauled by one tractor, one CCN is assigned to cover the shipment. Each trailer must be identified on the conveyance report, and the description field of the cargo report should indicate the number of pieces and trailers comprising the shipment eg. “1000 pieces contained in two trailers”

Multiple Trailers – One Shipment

Entered to Arrive (ETA) and Value Included (VI) Shipments

Pre-arrival cargo and conveyance data is required for ETA and VI shipments. CBSA will manually acquit the cargo data with the original transaction number associated with the goods.

Ships’ Stores (Goods Imported for Ships Stores)

Pre-arrival cargo and conveyance data is required for ship stores.

Ships’ Stores

Duty Free Shops (Goods Imported by Duty Free Shops)

Pre-arrival cargo and conveyance data is required for goods imported by duty free shops.

Goods Imported by Duty Free Shops

“To Order” Shipments

To acknowledge existing business practises, CBSA will accept “to order” “to order of shipper” or “to order of bank” or “other named entity” in the consignee field provided the name and address of the owner or his/her representative is transmitted in a “notify party” field.

“To Order” Shipments

Non-resident Importer

Non-resident importers and their foreign address are to be identified electronically in the consignee field. The delivery party name and address must be completed for where the goods are destined in Canada.

“To Order” Shipments

In-transit Cargo

Pre-arrival conveyance data is required for a Conveyance reporting with in-transit cargo.The conveyance report shall quote the in-transit cargo exception code. The Carrier will prepare and present to USCBP and CBSA copies of the A8B, United States – Canada Transit Manifest.

** CBSA will not issue AMPs penalties for failing to electronically transmit conveyance data until such time as the CBSA implements and mandates a complete in-transit solution.

In-transit Cargo

Transit International Routier (TIR) Carnet

Pre-arrival cargo and conveyance data must be transmitted for TIR Carnet import or or an E29B Temporary Shipment. The Conveyance report should quote the applicable exception code. A paper A8A is also to be provided to CBSA upon arrival.

“To Order” Shipments

 

Have questions?

If you have any questions about unique shipment processes under ACI eManifest, please do not hesitate to contact our Carrier Relations Liaison at 855.542.6644 or via email at carrierhelpdesk@pcb.ca.

 

eManifest Filing Services

Our Border Pro for Carriers eManifest filing services can assist you in submitting all relevant information to Canada Customs within the required time period to ensure your trucks cross the border as quickly and efficiently as possible.

 

What has your experience been crossing the border with unique shipments?  Share them in our comments section below or email us at Ask Your Broker.

 

Additional Resources:

 
 

Why You Should Conduct an Internal Customs Compliance Audit for U.S. Imports


Internal customs compliance audit

The responsibility of an importer to exercise reasonable care when importing to the United States has been at the core of customs compliance since the implementation of the Customs Modernization Act (Mod Act) in 1993.

U.S. Customs and Border Protection has the expectation that importers must be knowledgeable and proactive in the conduct of their legal responsibilities. Unfortunately, as members of the trade community, we occasionally hear comments such as “I didn’t know”, or “My broker never told me”.  The bottom line is that it remains the importer’s responsibility to have a comprehensive understanding of their obligations to Customs.

While customs law can be quite complex and somewhat bewildering, there are a relatively small number of very specific areas that form an importer’s foundation of compliance.  As laid out in the U. S. Customs and Border Protection Informed Compliance Manual entitled Reasonable Care these specific topics are briefly outlined here:

 

Areas in which importers must exercise reasonable care:

All Transactions

  • Use of external or internal experts
  • Review of all customs documentation, inclusive of entry declarations, for accuracy
  • Consistency in same or similar transactions across ports and modes of transport
  • Appropriate adjustments or Prior Disclosures when errors are discovered

 

Merchandise Description and Harmonized Tariff Classification

  • Having procedures in place to ensure that you are fully knowledgeable of the products you are importing – composition, country of origin, etc.
  • Properly describing the merchandise to Customs according to regulations
  • Ensuring that you are providing the correct tariff classification of the goods
  • Verification of whether your goods are eligible for specific duty free status

 

Valuation

  • Procedures to ensure accuracy of your declared transaction value, per Customs regulations
  • Are your transactions between “related” parties, and if so, ensuring that you are declaring the correct values to Customs?
  • Assists, commissions, royalties, etc., declared as appropriate

 

Country of Origin / Marking / Quota

  • Reliable procedures in place to ensure that the country of origin is declared correctly on your entry
  • All articles imported into the U.S. must be marked with the country of origin/manufacture
  • Processes established to determine and ensure that all necessary documentation is provided at time of entry

 

Intellectual Property Rights

  • Ensure that you have the legal right to import merchandise that is protected by trademark or copyright

 

Miscellaneous Questions

  • Ensure that you are filing the correct type of entry and that all other gov’t agency reporting is attended to

 

Please bear in mind that this is the “short list”.

 

The Importer’s Role in Trade Compliance

An efficient and compliant import process starts with everyone involved understanding their role and responsibilities. It is crucial that importers:

  • Understand their risks and responsibilities
  • Establish processes that ensure that all reasonable care standards are met, and
  • Ensure that these standards are monitored and enforced, safeguarding your continued privilege to import

 

Without having the proper knowledge of the responsibilities of an importer, and ensuring that you are both in compliance and have evidence of your actions, you may be at a higher risk for:

  • Penalties
  • Liquidated damages
  • Various customs audits
  • Increased costs of doing international business
  • Supply-chain disruptions and delays
  • Losing your import privileges

 

On the other hand, being knowledgeable about the expectations and acting with the expected due diligence, while not guaranteeing that you are not subject to an audit, does provide assurance that you are taking full advantage of allowable reductions in duty. Should Customs come knocking, you are prepared with appropriate responses to their questions.

 

Why conduct an internal customs compliance audit?

A thorough internal audit will help identify areas of risk and lay the foundation for your customs compliance plan.

 

Pacific Customs Brokers strongly encourages and advises every importer to conduct regular internal audits on their Customs transactions, and to use the Customs guideline in developing their internal controls and standard operating procedures.  The above-mentioned informed compliance publication on Reasonable Care is a great starting point.

 

How Pacific Customs Brokers Can Help?

Without proper customs training or hands-on instruction a business’ internal auditor will find identifying risks or exposures challenging. Our Trade Advisors stand ready to assist you in conducting an internal audit, and in working with you to develop or recommend improvements to your internal controls.

Stay Informed of Changing Regulations

To help you better understand complex compliance issues and implement effective solutions we offer a comprehensive Trade Compliance Education program. Explore one of our upcoming in-person seminars, online webinars and/or hands-on workshops to learn more. In particular, you might be interested in Part 2 of the next  U.S. Trade Compliance Seminar Series that takes a close look at Customs Audits and Importing Inspections. Learn more and register here!

 

Do you have questions about conducting an internal customs compliance audit? Ask our Trade Advisors. Leaving your comments below or email Ask Your Broker.

 
 

ACI eManifest Reporting for Hand-carried Goods


Hand-carried Goods

 

According to the Canada Border Services Agency, Hand-Carried Goods (HCG) are commercial shipments transported into Canada by an individual who does not meet the criteria of a “carrier”. A “carrier” is the owner or person in charge of a conveyance that is engaged in international commercial transportation of specified goods. “Specified goods” are goods that are or will be imported into Canada for a fee.

 

ACI eManifest reporting of hand-carried goods

CBSA has exempted hand-carried goods from eManifest advance cargo and conveyance data requirements. Read more about Hand Carried Goods here.

 

Hand-carried goods exempt from ACI eManifest requirements

Examples of qualifying hand-carried goods that are exempt ACI eManifest requirements are:

  • Commercial goods carried by paying passengers on board traveller’s commercial conveyances (bus, taxi, plane, ferry, etc)
  • Commercial goods being transported by and accounted for at the First Point of Arrival (FPOA) by the owner of a business, or an employee, driving a “not for hire” conveyance
  • Commercial shipments being imported into Canada by an individual who does not meet the criteria of “carrier” and who is not required under the regulations to have, use and maintain a valid CBSA issued Carrier Code.

 

Hand-carried Goods Release Process

Hand-carried goods must be accounted for at the First Point of Arrival (FPOA) either by a submitting a paper Form B3-3, Canada Customs Coding Form (document used to account for imported goods, regardless of value, destined for commercial use in Canada) or by engaging a customs broker to use the Hand-Carried Goods (HCG) Release Process.

 

How Pacific Customs Brokers Can Help

Pacific Customs Brokers is happy to set up customs clearances for your hand-carried goods. If you have any questions about this or any other cross-border transportation matters, contact our Carrier Help Desk at  855.542.6644 or carrierhelpdesk@pcb.ca.

 

Have questions about crossing the border with hand carried goods? What has your experience been? Share them in our comments section below.

 
 

The Most Commonly Overlooked Area of a Customs Audit – Valuation


Customs Audit - Valuation

In-depth compliance verifications by Canada Border Services Agency (CBSA) in recent years require that both importers and exporters establish adequate internal controls as well as maintain well-documented compliance procedures.

The majority of Canada Border Services Agency (CBSA) audits cover one or more of three topics:  tariff classification, valuation, and verification of origin. There are two post-release verification processes:

  1. Some audits are Random verifications where an importer is randomly chosen to undergo an audit. Random verifications are designed to measure compliance rates and revenue loss and the results may be used for many purposes, including risk assessment, revenue assessment, and promoting voluntary compliance.
  2. The other audit practice employed by CBSA is through Verification priorities where they target specific industries or products. In both situations, CBSA is examines importers for compliance and observing all rules and regulations.

Out of the major areas audited, the one most commonly overlooked by importers is the subject of valuation.

What is Valuation?

As it relates to imported goods, valuation means determining the correct value to declare to Customs. This is also known as the value for duty. There are 6 methods of determining Value for Duty.

The most common valuation method used is transaction value, however the final value for duty could be influenced by:

  • The relation between the parties involved (i.e. a related buyer and seller)
  • Conditions where the goods were not purchased by the Canadian recipient (i.e. consignment)
  • Allowable deductions to the price paid
  • Additions or other costs which must be added to the price before customs duty and taxes are calculated
  • Used goods
  • Goods sold while in Canada on a temporary basis

Valuation Topics Overlooked in Customs Declarations

While this subject is extensive, let’s review a couple of the key valuation topics that may have been easily overlooked when making customs declarations.

1.  Assists

An “assist” is defined as goods or services provided free or at a reduced charge by the purchaser for use in the production of imported goods.

  • Materials, components, parts and other goods incorporated in imported goods.
  • Tools, dies, moulds, and other goods utilized in the production of imported goods.
  • Any materials consumed in the production of imported goods.
  • Engineering, development work, art work, design work, plans and sketches undertaken elsewhere than in Canada and necessary for the production of imported goods.

For example, if a Canadian purchaser contracted a U.S. company to bottle juice where the Canadian company provided the packaging materials, the additional costs of the packaging would need to be included in the declared value of the juice.

2. Parties involved in a transaction

Many transactions involve two parties – a buyer and a seller, which usually makes it is easy to determine the value for duty. However sometimes there are numerous parties: manufacturers, exporters, distributors, buying and selling agents, vendors, consignees and purchasers. The involvement of many parties could make it difficult to identify the correct value for duty and additional care should be exercised.

In many cases, the results of assigning correct values can be “revenue neutral” with CBSA; in other words, the goods may be duty free which means that the importer will not incur additional expenses. Like all importations however, the onus is still on the importer to make accurate customs declarations or potentially expose themselves to fines and penalties under the Administrative Monetary Penalty System (AMPS).

 

Why should an importer or exporter be concerned?

1. Primarily due to the fact that Valuation is an area that is reviewed and regulated by CBSA. Importers generally spend the least amount of time worrying about valuation, but it is still an area where you are expected to be compliant.

For a detailed version of the current targeted priorities, visit this CBSA webpage Trade Compliance Verifications.

2. Secondly, there are over 40 memorandums in the CBSA D Series that deal with valuation. It can be an intricate area to navigate if your foreign purchases involve situations which could change the declared value to Canada Customs.

Will your business undergo a customs audit?

Whether your business is importing or exporting goods, you should be aware that at some point you are likely to be selected for an audit.

 

Customs Audit Assistance Services

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. We have the expertise to guide your company through the audit process.

 

Preparing for a Customs Audit

Businesses that do not plan for a potential customs audit do so at their own risk. To learn more and gain insight on the customs audit process and what CBSA is assessing, consider attending an upcoming  Canadian Trade Compliance Seminar. For an in-depth session that will guide you through the maze of regulations that determine transaction value attend our upcoming Customs Valuation Seminar. If you are importing and exporting goods into the United States, you will find our U.S. Trade Compliance Seminar of interest.

 

Have questions around a customs audit? Ask our Trade Advisors. Leaving your comments below or email Ask Your Broker.

 

Additional Resources:

 
 

Ignorance is Not Bliss – The Potential Perils of Antidumping and Countervailing Duties


Antidumping and Countervailing Duties

As an importer of foreign goods coming into the commerce of the United States, you already know how complicated the import formalities can be, and there is always more to learn. One subject that may not have appeared on your radar is that of trade laws such as Antidumping (AD) and countervailing duty (CVD).

 

What is Dumping?

Dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer’s sales price in the country of origin, or at a price that is lower than the cost of production.

 

What are Countervailing Duties?

Foreign governments subsidize industries when they provide financial assistance to benefit the production, manufacture or exportation of goods. Subsidies can take many forms, such as direct cash payments, credits against taxes, and loans at terms that do not reflect market conditions. Countervailing duties are assessed to counter the effects of the subsidies provided by foreign government to merchandise that is exported to the United States. These subsidies cause the price of such merchandise to be artificially low.

 

Measures of Protection for U.S. Industry

If a U.S. industry believes that it is being injured by unfair competition through dumping or subsidization of a foreign product, it may request the imposition of antidumping or countervailing duties by filing a petition with both Enforcement and Compliance and the United States International Trade Commission. Enforcement and Compliance investigates foreign producers and governments to determine whether dumping or subsidization has occurred and calculates the amount of dumping or subsidies.

According to the United States International Trade Administration, there are hundreds of antidumping cases for 44 US trading partner countries, including but not limited to countries as diverse as Argentina, Canada, Italy, China, Malaysia and Ukraine.  There are more active AD cases for goods manufactured in China than from any other country.

Products affected range from ironing boards to wooden bedroom furniture to ball bearings to engineered wood flooring, solar panels and cells; from honey to salmon, from shrimp to pasta to mushrooms. New cases are initiated frequently, while other cases are terminated.  AD rates can range from less than 1% to over 250% of the import value of the goods.

 

Customs Entry Requirements

With all antidumping cases, there are additional formalities and documentation that is required to be presented with the customs entry, no matter the AD rate. U.S. Customs and Border Protection will require that the customs entry include documentation certifying that you, the importer, are not being reimbursed by the manufacturer for the cost of the antidumping duties. Because AD cases are assigned based on information provided by the manufacturer to the ITA, and different firms may receive either higher or lower AD rates, it is important that you provide the full legal name and address of the actual manufacturer and the exporter, in order to ensure that the correct AD case is associated with your entry.

 

Customs Bond Underwriter Requirements

Due to the very high risks that U.S. customs approved bond underwriters assume when writing these required bonds, they are very likely to require that importers affected by antidumping regulations provide 100% collateral at the time of their bond application or roll-over. They will also require that the importer provide full financial information at that time. Providing collateral involves transferring either a certified check or a letter of credit, generally equal to 1-2 years of the importer’s continuous transaction bond. These funds or release of the letter of credit will be held by surety in order to protect them should there be an increase in Antidumping Duties (ADD) liability, and will not be returned to the importer until at least 180 days after the final entry has liquidated.  Many years can pass before an Antidumping case is closed, thus permitting liquidation of the entries.

Note: Depending on the importer’s history, volume and value of imports, the surety may require further collateral at any time.

 

Recommendations for Importers of New Products

You may well imagine that being unaware of a potential AD case on your product, discovering that your goods are subject to an unplanned additional duty can come as quite a shock, not to mention a tremendous expense.

Pacific Customs Brokers recommends that you contact your customs broker or attorney prior to making purchasing decisions for goods that are new to your firm.  Our Trade Advisory team can assist you with research on the dutiability of the product and advise on eligibility for reduced or duty free treatments, in addition to determining whether it may be subject to Antidumping duties.

 

Understanding Antidumping or Countervailing Duties

To learn more about Antidumping or Countervailing duties attend an upcoming H.S. Tariff Classification Workshop.

 

What are your thoughts on Antidumping? Are your products impacted by these duties? Please share in our comments section below.