The Canada Border Services Agency (CBSA) administers a trade compliance program that verifies the tariff classification, origin, and value of goods imported into Canada. This ensures the appropriate use of the trade incentive programs and that duties and taxes owing are properly assessed.
Specific importers, goods, or industries are selected for verification in two ways:
The CBSA defines random verifications as a method to measure compliance rates and revenue loss. The results may be used for different purposes such as risk assessment, revenue assessment, and the promotion of voluntary compliance.
The CBSA defines targeted verification priorities as items that are determined through a risk-based process that has new targets added twice a year. Verification priorities may also be carried over from previous years. The most recent verification priority list was published on July 20, 2016, and can be found here.
Targeted Verification Process
Identification of risk is done through referrals from border officers, select government departments, and external stakeholders such as Canadian manufacturers and industry associations.
Priority submissions are prepared by CBSA regional officials to identify specific issues and companies to be verified based on the impact of the suspected non-compliance.
These submissions are presented to an internal committee for review and decision. If approved, the target becomes a verification priority and trade compliance audits are initiated.
Verifications are conducted on a select sample of importations within a specific time period. When non-compliance is determined, importers must, by law, file self-corrections for importations of same and similar goods within a specified period of up to four years.
Escalating penalties are applied as a corrective measure in cases of non-compliance.