Trade Compliance

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CBSA Trade Compliance Verifications: January 2015

Posted January 16, 2015

The CBSA manages trade compliance with the Tariff Classification, Valuation, and Origin programs using the following two post-release verification processes: random verifications and verification priorities

Random Verifications:

Random verifications are designed to measure compliance rates and revenue loss and the results may be used for many purposes, including: risk assessment; revenue assessment; and promoting voluntary compliance.

Verification Priorities:

Targeted verification priorities are determined through a risk-based, evergreen process, meaning that new targets are added throughout the year. Verification priorities may also be carried over from previous years. The list of current verification priorities includes a number of new products, for which results are not yet available.

Parts for Power Trains: The risk identified is that goods could be incorrectly classified within Heading 87.08, instead of being properly classified under tariff item 8708.99.15 (parts for power trains for the vehicles of Heading 87.03), which attracts a duty rate of 6%. This verification priority was released in August 2014.

Generating Sets: The risk identified is that generating sets could be incorrectly classified within Heading 85.02, instead of being properly classified elsewhere within the same position, and potentially be subject to a duty rate of 2%. This verification priority was released in August 2014.

Geophysical and Oceanographic Instruments: The risk identified is that various instruments could be incorrectly classified within Heading 90.15, whereas the accurate tariff items could potentially fall outside of Heading 90.15 and/or be subject to various duty rates depending on the appropriate classification that may be determined. This verification priority was released in November 2014.

Cereals: The risk identified is that cereals could be incorrectly classified under Heading 10.08, whereas the accurate tariff items could potentially be subject to various duty rates depending on the appropriate classification that may be determined. This verification priority was released in December 2014.

Articles of Apparel and Clothing Accessories: The risk identified is that goods could be incorrectly classified within Heading 39.26, which attracts lower duty rates, instead of being properly classified under tariff item 6210.40.90 (other men's or boys' garments) or 6210.50.90 (other women's or girls' garments), which are both subject to the significantly higher duty rate of 18%.The issue is that clothing containing a layer of plastic, combined with textile fabric that is not considered as reinforcement to the plastic, should not be classified under Chapter 39. This verification priority was released in December 2014.