Q.

Do I need a "business number" in order to import goods into Canada?

Submitted by : Sally Jones
A.

The Canada Revenue Agency (CRA) requires any entity doing business with the Canadian government to apply for and receive a business number.  The business number is used to identify a business for purposes of revenue compliance, and for any other contacts with the government.  According to CRA, the business number concept is based on the idea of “one business, one number.”   Once a business has been assigned a unique business number, it will subsequently register with different CRA “program accounts.”  The four major program accounts are:  GST/HST, payroll, corporate income tax, and import/export processing

 

A business number consists of 15 digits:  A “root” of nine numbers to identify the business, followed by two letters and four numbers to identify the program and account that is being referenced.  The XYZ Corporation, for example, might be issued Business Number 123456789.  If XYZ wants to access its import/export account, the  code might look something like:  123456789RM0002.

 

However, not every business needs a business number.  CRA lists a number of exemptions, based largely on value and volume of imports, and purpose of goods entering Canada.  But for most businesses, it makes sense to heed CRA’s own recommendation:  “If you import goods into Canada…, you should register.”

 

Q.

What is the ACI Program?

Submitted by : Lisa Andrews
A.

The Advance Commercial Information (ACI) program is a critical part of Canada’s border security efforts.  ACI is a technology-driven program that requires advance notification of all shipments headed for the Canadian border. 

 

ACI is administered by Canada Border Services Agency, as a way to manage risk by allowing agents to focus resources on shipments that have been identified as potentially high risk.

 

Purpose of ACI

The purpose of ACI is to allow CBSA to minimize the risk of hazardous products entering Canada, and to better identify threats to the country’s health, safety and security.  Early notification will alert CBSA agents about incoming shipments that may warrant special attention, and allow them to plan ahead and respond accordingly.

 

ACI Exemptions

CBSA exempts the following shipment categories from ACI compliance:

  • Postal Shipments (full loads only)
  • Shipments cleared through the Courier/Low Value Shipment program 
  • Shipments exported from Canada.
  • Goods on board a conveyance that enters Canadian waters while enroute directly to a non-Canadian destination

 

ACI Program Benefits

Aside from strengthening border security and minimizing the risk of hazardous materials gaining entry into Canada, ACI has several important benefits for the cross border process:

  • Electronic data transmission eliminates paperwork
  • Advanced notification of pending arrivals allows CBSA to better allocate manpower resources, so that proper attention can be given to high-risk shipments.
  • Reduction in delays and congestion

 

Implications for U.S. Businesses

U.S. businesses that use a logistics provider rely on their transportation manager to ensure ACI compliance.  The following are a few of the requirements necessary to comply with ACI and eManifest:

  • Software and technology compatible with CBSA systems;
  • Dedicated personnel familiar with program requirements and capable of transmitting ACI-mandated data about each shipment;
  • Dedicated personnel to monitor changes to ACI and other regulatory programs;
  • Established contacts within CBSA to resolve problems and answer questions;
  • Additional compliance capability for other U.S. and Canadian regulations, duties and fees, and processes.

 

 Penalties for Non-Compliance

Beginning May 1, 2013, shipments arriving at the border without having satisfied ACI requirements faces delays and possible financial consequences.  Similarly, information received by the CBSA that is erroneous, or incomplete, will result in a “hold” being placed on the shipment that will only be lifted once the proper data is provided.  Fines assessed for non-compliance range from several hundred dollars to several thousand. 

 

 

Q.

Can I ship in a plastic container?

Submitted by : Edward Benton
A.

A plastic container can be used as packaging for your shipment. You should ensure the container is sealed properly and the lid will stay secure during transport. Also, you will want to confirm that the plastic container will not split or crack during transport.  

 

Q.

What are some of the Security Clearance programs I should involve my business in?

Submitted by : Steve Jones
A.

There are multiple programs develop by US and Canadian agencies to expedite border crossing. Provided here is a list of the most common. You can access detailed descriptions on the Trade Incentives Page.

  • Advanced Commercial Information (ACI) program
  • Automated Export System
  • Customs-Trade Partnership Against Terrorism (C-TPAT)
  • Free and Secure Trade (FAST)
  • Nexus
  • Partners in Protection (PIP)
  • Pre-Arrival Processing System (PAPS)
  • Pre-Arrival Review System (PARS)
 

Q.

I'm looking into ordering a package from the U.S and delivered to Canada. If shipped through Purolator, is there going to be an additional brokerage fee?

Submitted by : Chris Morrison
A.

Additional brokerage fees will be assessed and applied to the shipment based on the shipping terms the US Company has developed with Purolator.  Brokerage costs should be indicated at the time of check-out, otherwise there may be additional costs.  I recommend you reach out to the US Company and ask them what their policy is for international shipments. If this company is a US etailers, their FAQs may indicate any other applicable charges. This way you will not have any surprises when your package arrives.

 

Q.

What kind trade incentives programs are available for US manufacturing businesses shipping to Canada?

Submitted by : Sarah Duden
A.

U.S. businesses are eligible to participate in the U.S. Customs Service’s Duty Drawback program. Intended as a way to prevent businesses from being over-taxed, the Duty Drawback Program gives special consideration to businesses that pay duties on goods imported into the United States, and then used in the manufacture of products that are subsequently exported.

Example: A California-based clothing manufacturer may import silk ribbon from Japan for use in a new line of blouses. The company is required as part of Canadian customs requirements to pay a duty on that ribbon when it is imported into the U.S. After the ribbon is sewn onto the blouses and packaged for export, it will again be subject to taxation. Under this scenario, the ribbon would be taxed twice. The Duty Drawback program is intended to address this inherent unfairness by returning the “second” duty payment paid on the same item.

 


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