When it comes to importing and exporting goods, customs compliance is a serious matter. To be in good standing with the Canada Border Services Agency or the Customs Border and Protection Agency, certain rules need to be followed.
Here are some tips on making sure your company is compliant:
- Reconcile goods with the purchase order and the invoice while also letting your broker know of any discrepancies such as overages or shortages.
- Make sure you have all the permits needed under government regulations and that the permits are ready for clearance of goods before they’re imported.
- Make sure your vendors know what information is needed on invoices, such as descriptions of goods, part/SKU numbers, tariff classification numbers, and terms of sale.
- Before placing a purchase order, be aware of restrictions or federal requirements.
These tips are only a starting point as there are more requirements to make a company compliant to federal regulations. What is needed is a customs broker who knows compliance and can make the job easier on your company. Frontier’s staff of fully trained and efficient brokers are able to make companies compliant in short order.
As an importer or exporter you’re legally responsible for the information provided to customs, even when you use a broker.
Getting a letter from Canada Boarder Services Agency stating your company has been selected for an audit to see if your shipments have complied with regulations can be unsettling. Further, to meet the request, several documents are required by the agency.
There are many reasons why an importer is chosen for an audit, some of which are: to see if duties match the Harmonized System classification codes; to verify the correct value was placed on imported/exported goods; and to confirm the correct country of origin was used.
Even after receiving your documentation, CBSA may still require technical data sheets for imported items, information on how goods are used, or confirmation of sale and purchase orders.
Knowing all this, it’s not surprising that audits can be unsettling and time consuming, which is why Frontier’s staff of highly trained brokers are there for our clients to assist them in all audit requests and appeals.
Free Trade Agreements
Canada currently has 13 free trade agreements with various countries, while the United States has 14 free trade agreements.
The largest free trade agreement both countries have is the North America Free Trade Agreement (NAFTA). The agreement allows for traded goods between the three nations to be duty and tax free.
The 25-year-old agreement was recently re-negotiated between the three parties and was renamed the United States-Mexico-Canada Agreement (USMCA). It is expected to come into force in 2020.
A number of revisions were made to NAFTA in the USMCA which brokerage houses should be knowledgeable of, such as changes to the import/export of automobiles and auto parts and opening of the Canadian dairy market.
Other measures of the $25 trillion agreement include the addition of increased intellectual property protections for patents and trademarks, especially for biotech, financial services and domain names – which weren’t in the NAFTA agreement of the 1990s.
Suppliers in the United States and Canada sometimes don’t have the manpower or up-to-date information to process all the documentation that is needed under NAFTA, which is why using brokers at Frontier is so essential.
Not only can Frontier help with processing of free trade documents, but we can also prepare our clients for audits. At Frontier we believe in preparing and protecting our clients, which is why knowing the ins and outs of NAFTA can help avoid a costly audit by Canada Border Services Agency.