Memorandum D17-2-5: Duty Liability of Importer of Record
ISSN 2369-2391
Ottawa,
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Note: This memorandum comes into effect .
Section 17(3) of the Customs Act states the “importer of record” on the Canada Border Services Agency (CBSA) accounting documents is jointly liable with the owner and importer for the payment of duties, including any reassessed amounts after the final accounting.
Plain language summary
Target audience: Importers of commercial goods and their agents
Key content: This memorandum clarifies the Canada Border Services Agency's (CBSA) policy on customs duty liability.
Keywords: accounting, commercial goods, importer, liability, importer of record, reassessment, owner
On this page
- Definitions
- Guidelines
- Context
- Liability for duty after final accounting
- Primary liability holder
- Authorized agents as importers of record
- Shared liability
- References
- Contact us
Definitions
For the purposes of this memorandum:
- Authorized agents:
Include customs brokers and persons authorized.
- Business numbers (BN):
15 digits identifying a business's accounts. It comprises the business's 9-digit Canada Revenue Agency business number appended by the 6-digit alpha-numerical CBSA RM import-export sub-account. The CBSA uses the BN to identify the “importer of record” to process customs documents and for compliance purposes.
- The Courier Low-Value Shipment (CLVS) Program:
A service offered by the Canada Border Services Agency (CBSA) to help simplify importing low-value goods. The program streamlines the customs processing of shipments valued at CAD$3,300 or less. It provides the express carrier industry with expedited release. The program was designed for shipments imported by express carriers and is available for commercial and personal use.
- Customs brokers:
Include CBSA-licenced persons under section 10 of the Customs Act who account for the goods on the importer's or owner's behalf. Customs brokers are a category of authorized agents.
- Duties:
Have the same meaning as defined in section 2(1) of the Customs Act and include duties or taxes levied or imposed on imported goods under the Customs Tariff, the Excise Act, 2001, the Excise Tax Act, the Special Import Measures Act or other acts of Parliament.
- Importer:
Usually the person(s) who brings the goods into Canada or causes the goods to be imported into Canada.
- Importer of record:
The person identified as the importer on customs declaration when goods are accounted for under subsection 32(1), (2), (3) or (5) of the act. The importer identifies themselves by citing their business number during the CBSA release and accounting processes.
- Owner:
The person who owned the goods when the CBSA released them.
- Persons authorized:
CLVS participants under paragraph 32(6)(a) of the Customs Act (the act) who account for the goods in lieu of the importer or owner, or a person not resident in Canada authorized by the minister, the president, or their delegate under paragraph 32(7) to account for goods in lieu of the importer or owner of those goods. Persons authorized are a category of authorized agents.
Guidelines
Context
1. Importers and owners are required to account for goods imported into Canada. Customs brokers may account for the goods on an importer's or owner's behalf, declaring their client or themselves as the importer of record. A person authorized may account for goods in lieu of the importer or owner and become the importer of record under the Courier Low-Value Shipment Program.
2. The CBSA recognizes customs brokers and persons authorized as authorized agents.
3. To transact business with the CBSA, commercial entities must have a business number (BN) with an import/export account number (RM). Those together identify the importer of record.
Liability for duty after final accounting
4. An importer of record may become liable for additional duties after final accounting due to re-determinations, further re-determinations, reappraisals or other legislative obligations. These reassessments include the consequences of the following:
- Importers' obligations under section 32.2 of the act are to make corrections to declarations of origin, tariff classification or value for duty, and to pay owed duties when they have reason to believe their declarations are incorrect
- CBSA audits or examinations under section 42, verifications under section 42.01 or verifications of origin under section 42.1 of the act
- CBSA re-determinations or further re-determinations under sections 59(1), 60(4) or 61(1) of the act
Primary liability holder
5. There is only one self-declared importer of record for an importation of goods. There can be more than one importer or owner of goods.
6. The CBSA considers the importer of record the primary contact for verifications and the entity with direct liability for post-accounting obligations, including record keeping, making corrections, and payment of duties.
7. The CBSA expects that if the importer of record , the importer, or the owner of goods are different entities, they work cooperatively before, during, and after final accounting to ensure their joint compliance with the act.
8. Persons who present themselves as the importer of record and who are not authorized to account for goods by the CBSA and by the importer or owner may be subject to sanctions and penalties under the act in addition to assuming duty liability and recordkeeping obligations after final accounting.
Authorized agents as importer of record
9. Authorized agents sometimes assume the dual role of a customs broker or persons authorized and importer of record under the direction of the importer or owner of the goods. Memorandum D11-6-11 Post-Accounting Obligations Authorized Agents as importer of record provides information about the liability for post-accounting obligations assumed by authorized agents who are the importer of record under the direction of commercial entities.
Shared liability
10. The CBSA considers the importer of record the first contact for verifications and the primary liability holder for debts. However, other persons share liability for payment of duties when the agency determines they were the importer(s) or owner(s) through implicit or explicit contracts or codependent import intentions.
11. The CBSA may contact the importers or owners of the goods during its verification activities, even if they are not the importer of record.
12. Should the importer of record default on their assessed duties, the CBSA may hold the importers or owners of the goods liable, jointly or individually.
13. The CBSA encourages importer of records, importers, and owners to share clear and transparent provisions explaining how they will manage duty liabilities and refunds between the parties.
References
Consult these resources for further information.
Applicable legislation
- Section 17(3) Customs Act (not yet in force)
- Customs Broker Licensing Regulations
- Persons Authorized to Account for Casual Goods Regulations
Related D memoranda
- D17-2-3: Importer Name/Account Number or Business Number Changes
- D11-6-6: Reassessment Policy Reason to Believe and Corrections to the Declaration of Origin, Tariff Classification or Value for Duty
- D11-6-10: Reassessment Policy
- D11-6-11: Post-Accounting Obligations Authorized Agents as Importer of Record
Issuing office
Trade and Anti-dumping Programs Directorate
Policy Integration
Planning and Performance Planning
Contact us
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