Can PICS help with new Canada Border Services Agency (CBSA) Compliance Requirements?

yes! In a word, yes! Beginning April 1, 2019, importers of fresh produce are required to notify CBSA of changes to purchase orders for items such as quantity, price and origin – regardless of whether or not there is duty or GST payable. When these changes are made in PICS, they can easily be reported.

Background

Source: CPMA Member Bulletin March 20, 2019

“This notice has been issued to increase certain AMPS penalties as a response to the Auditor General’s report in 2017 in which the AG determined that AMPS penalties were too low to actually improve compliance with certain Trade programs.

CPMA thanks CPMA Member, Dave Bucholtz of ABC Customs Brokers/Pacific Customs Brokers, who provided the following analysis to assist industry in determining the potential impact to their business.

Below I have highlighted the penalties that the produce industry would be most affected by. As you will note, the prevailing theme is corrections, corrections, corrections. It is very important that all importers understand their compliance requirements when it comes to making corrections to transactions with CBSA. For the produce industry, corrections are typically required in the following instances:

  1. You are expecting a shipment of 1000 cases of lettuce but only receive 995, or conversely, you receive 1004 cases. As the Importer of Record, you are required to file a correction with CBSA to adjust the weights and values that would have been declared, based on receiving a different quantity than what was declared to CBSA.
  2. You receive a load of lettuce for which you have declared a price of $6.50 per case to CBSA at the time of release. When you receive the product, it is not in the shape that it should be, so you negotiate a different price with the seller. The final price that you settle on is $3.75 per case. As the Importer of Record, you are required to file a correction with CBSA to adjust the value accordingly, based on the final price paid.
  3. You receive a load of lettuce and the declaration to CBSA references the state of origin as California. After the fact, you realize that the state of origin was in fact Arizona. As the Importer of Record, you are required to file a correction with CBSA to adjust the state of origin accordingly.

It is very important to note that corrections are required to be filed regardless of whether or not there is duty or GST payable. In other words, corrections must be filed although the net effect with CBSA is revenue neutral. Also important to note, all corrections must be filed within 90 days of having Reason to Believe that the original release declaration was incorrect. If you are audited by CBSA and they find that required corrections have not been filed, then you will be subject to the AMPS penalties, as noted in CN19-05.”

See Contraventions and Penalties:

https://www.cbsa-asfc.gc.ca/publications/cn-ad/cn19-05-eng.html

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