COVID-19 Trade Updates

COVID-19 Trade Updates for Canadian - U.S. Businesses, Exporters, Importers and Manufacturers.



PAGE UPDATED - THURSDAY • JUNE 3, 2020  RECENT UPDATES IN RED.
UPDATES EXPECTED REGULARLY. BOOKMARK THIS PAGE - CHECK IN DAILY AND SUBSCRIBE HERE TO RECEIVE NOTIFICATIONS.

 

Key Points
 

  • USMCA/CUMSA is set to go into force on July 1st, 2020. However, automakers/businesses are concerned as they still require detailed regulatory information in order to adjust to the new deal's more stringent origin rules and require time to understand and implement them effectively. In light of automakers currently dealing with either shutdowns or shifting production to manufacture urgently needed medical equipment, they will receive an extension on the July 1 deadline. Allowing them to submit plans laying out a delayed process for complying with new USMCA rules by no later than August 31, 2020. Check out our comprehensive guide/page on USMCA/CUSMA here.
  • Canadian, U.S. & Mexican governments confirm that Northern border and Southern border trade remains stable and without disruption. Cargo is considered essential and therefore should not be subjected to additional screenings or potential slowdowns. The Department of Homeland Security has a great factsheet. 

Canada 

Duty, GST & HST - Deferred (until June 30, 2020)

Importer Security (Bond and/or GST) is required for Duty and Tax deferrals until June 30, 2020. Bonds are the future of trade - more details here.

Previous Updates:

Justin Trudeau just announced the equivalent of giving $30-billion in interest free loans to businesses by deferring GST, HST, and Duty until June 30, 2020. Below is the latest confirmed information, we will continue to update as additional information becomes available.  

  1. Payment deferral is applicable to all duties and taxes owing, not just month end settlement. Applicable period is March 28, 2020 forward including March statement of account.  
  2. The filing of accounting information is unchanged although late accounting penalties, within the designated period will be waived.  
  3. Payment that was sent and received by CBSA on March 26, 2020 will be processed. 
  4. Cheques received by CBSA from March 27 – April 10, 2020 – CBSA will contact issuer. CBSA will return e-payments from March 28 – April 10, 2020.  
  5. Cheques and e-payments received by CBSA after Friday April 10, 2020 will be assumed as intended payment and processed.  
  6. Commercial pay as you go details are under consideration.  

CBSA Payment Deadlines (Extended) 

  • B3 - Due date is June 30 and applies to all B3s due April 1 to June 30. A B3 is a debt transaction on the account which is always related to an importation.
  • B2 (Debit) - Due date is June 30 and applies to all B2 debts due March 25 and after. A B2 (Debit) is a correction/adjustment to a B3 transaction. 
  • B2 (Credit) - Not impacted by deferral measure, will be processed normally. A B2(Credit) is a correction to a B3 transaction. 
  • K3 or K23 - Original due date remains. A K3 or K23 is miscellaneous debt.
  • AMPS - Original due date remains. AMPS is a penalty imposed for violating CBSA’s trade and border legislation.
  • RS (RSF) Posting - Due date is June 30 and applies to all RS transactions due March 31 and after. CSA Program – Self Assessment.
  • K9 - Original due date remains. A K9 is a penalty for not declaring a product.
  • K32 Drawback - Not impacted by this deferral measure, will be processed normally. A K32 Drawback is a refund for custom duties paid for imported goods. In order to get the drawback credit, the importer must file a drawback.

45 Day Grace Period for Late Accounting

CBSA has decided to provide a 45 business days grace period for late accounting penalties. Importers and brokers will not have to submit an application to have late accounting penalties waived. This waiver applies to transactions released from March 11, 2020, to May 14, 2020, inclusively.

Canada Waives Duty on Certain Medical Goods

The Canadian government has waived import tariffs on various medical goods, including PPE such as masks and gloves. Click here to find out more about which goods are covered by the new Remission Order.

Post-Audit Corrections (Extended to 120 Day Period)

CBSA has also extended by one month the 90-day period for submitting corrections, following a CBSA trade compliance verification where errors were found. Importers/brokers will now have 120 days in which to submit B2s for any needed corrections.

CBSA To Reduce Service Hours (Temporarily)

As of April 15, 2020, the Canada Border Services Agency (CBSA) announced that effective April 15, 2020 at 11:59 pm EDT, they will be reducing service hours (temporarily) at 27 land border crossings in response to the COVID-19 pandemic.

The CBSA has stated that the adjustments will remain in effect until the expiration date of the Order in Council made under the Quarantine Act which prohibits entry into Canada from the United States. The full-service schedule is available here.

Note: As of April 15, 2020, these changes do not impact the crossings in Ontario. However, we will continue to monitor this for any changes and will notify you if there are updates.

Single Window Initiative (Postponed)

SWI is working; however, Health Canada requires significantly more work and other areas have been unstable, which have impacted the movement of groceries and requires the use of ‘back-up’ (the old system). The postponement will likely take next date into 2021. Industry will make representation for a further deferral, due to the instability of the program currently. 

CARM (Postponed)

CBSA’s Assessment & Revenue Management - Release 1, Client Portal launch has been postponed to April 2021. As a result, Release 2, Registration and Enrollment now has a TBD date. Details here.

Importing Medical Supplies - PPE, EUA

Details on importing Non-Medical Grade Masks can be found under 'Masks' on our page here: Importing Personal Protective Equipment (PPE) and Emergency Use Authorizations (EUA) Goods.

Previous Update:

Importing Personal Protective Equipment (PPE) and Emergency Use Authorizations (EUA) Goods has increased significantly as a result of the COVID-19 health crises. We detail for both Canada and the USA how to import such items, details surrounding their HS Classifications, ensuring that you stay compliant with both Canada and U.S. Customs here.

Certain Compliance Activities Suspended

CBSA advises that it has temporarily suspended trade compliance activity interaction with importers/exporters and agency representatives for an indefinite period of time.

CITT Remains Open

All in-person hearings are canceled however the electronic filing system is fully operational. All scheduled filing deadlines are to be maintained and requests for extensions of filing deadlines are being handled on a case by case basis.

CFIA Offices are Moving to Appointment Only

Please contact your local CFIA office before visiting, to book an appointment. More information on CFIA operations available here.

RPP Bonds

Bonds can be filed and amended. CBSA will continue to have personnel in locations that normally receive bonds by mail and there will be no disruption to processing bonds received.

CSA & PIP 

Maintain their statuses. Trusted traders who take part in Partners in Protection or Customs Self-Assessment programs who are up for re-validation will maintain their trusted status as they continue to be compliant.

USA 

Duties, Taxes & Fees

CBP will be postponing for 90 days the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers, who are experiencing a significant financial hardship* due to the coronavirus disease (COVID-19).

  • Consult with your Trade Import Specialist to ensure your entries do not include merchandise that is ineligible for the postponed payment. Temporary postponement will not apply to antidumping duties, countervailing duties and/or Section 201, 232 or 301 duties
  • Importers are encouraged to take advantage of the Automated Clearinghouse (ACH) for electronic payment to facilitate this temporary 90-day postponement. Payment timeframes and additional information can be found here.
  • Frequently Asked Questions can be found here. 
  • CBP provides additional guidance in response to questions about duty deferral here

*Significant financial hardship - Operations of importer are fully or partially suspended during March 2020 or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings due to COVID-19, and as a result of such suspension, the gross receipts of such importer for March 13-31, 2020 or April 2020 are less than 60% of the gross receipts for the comparable period in 2019. Note: An eligible importer does not need to file documentation with CBP to be eligible for this relief, but must maintain documentation as part of its books and records establishing that it meets the requirements for relief. CBP may also conduct a review of the documentation at a future date to ensure compliance with the requirements.

Requirement

Before your Service Provider can remove entries from your importer statement, you must acknowledge to your Service Provider, in writing, the following: 

"I understand that CBP has provided for a 90-day duty postponement for importers with operations that have been fully or partially suspended during March 2020 or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings due to COVID-19, and as a result of such suspension, the gross receipts of such importer for March 13-31, 2020 or April 2020 are less than 60 percent of the gross receipts for the comparable period in 2019. I confirm that my company satisfies this requirement and I understand that I may be required to submit proof of our qualification to CBP."

U.S. Federal Government Response to COVID-19

Click here for a resource page published by the official website of the United States government, which provides a comprehensive summary of the actions being taken by various federal agencies in response to the COVID-19 pandemic. 

Update June 3 - Regulatory Relief to Support Economic Recovery

Click here to learn more about the implications for traders of an Executive Order issued on May 19 directing federal agencies of the U.S. Government to “temporarily or permanently rescind, modify, waive, or provide exemptions from regulations and other requirements that may inhibit economic recovery.”

FMCSA Extends COVID-19 Hours-of-Service Exemption

The Federal Motor Carrier Safety Administration has extended until June 14 broad exemptions from hours-of-service (HOS) rules for drivers hauling freight deemed essential during the COVID-19 pandemic. 

FDA Import Operations

FDA is requesting that importers electronically send records required under the FSVP for importers of food for humans and animals rule. FDA is temporarily conducting these inspections remotely during the COVID-19 public health emergency. Otherwise, operational systems are functional with the following activities still ongoing during the pandemic: FDA Prior Notice review, FDA entry processing, FDA sampling/examination of high-risk shipments, FSVP inspections, filer assessments, and compliance enforcement. More information can be found here.

Submitting Documents to the FDA

In a recent cargo message, CBP strongly encourages importers to submit product labeling along with regularly submitted entry documents in order to help expedite the admissibility process during the pandemic. Importers are also reminded that labeling and other documents should now be sent electronically via the FDA Import Trade Auxiliary Communication System (ITACS). 

Previous Updates:

FDA has taken action to increase U.S. supplies to support the U.S. response to COVID-19 by providing instructions to manufacturers importing personal protective equipment and other devices.

EPA Released Filing Tips

The Environmental Protection Agency has published new process for handling paper pesticide notice of arrival filings. Notice of Assessments (NOAs) will now be accepted by email. Mailed submissions will not be accepted. Please contact your regional coordinator for specific instructions.

USDA Extends Expiration Date of Audit Certificates

To help the movement of fresh specialty crops, the expiration date of USDA audit certifications scheduled to expire on or before May 31, 2020 have been extended 60 days. This will allow USDA to focus on food safety verification audits for new entities while enabling established entities to continue to move product into commerce. 

C-TPAT Validations Stopped 

The CBP advises that it has temporarily stopped validations of the Customs-Trade Partnership Against Terrorism program due to the COVID-19 pandemic. Click here for more information on available C-TPAT services and new program developments.  

State Department Defense Trade Controls Implements New Measures 

The Department of State’s Directorate of Defense Trade Controls (DDTC) has announced certain new measures to mitigate the impact of the pandemic on U.S. companies and supply chains overseas as outlined here

United States-China Economic and Security Review Commission Report

A Congressional report looking into the cascading economic impacts of the COVID-19 outbreak in China on the global economy and the challenges it presents to the U.S. economy going forward has been published by the U.S.-China Economic and Security Review Commission. Click here to read more about the key findings of the commission.  

U.S. International Trade Commission Issues COVID-19 Response Product Database

The U.S. International Trade Commission has released the results of its recent investigation to identify imported products required to fight the COVID-19 pandemic, which has prompted some lawmakers to call for a 90-day suspension of duties. Click here to get more information on this report and the political reaction to it in Congress. 

Previous Updates:

Details on personal protective equipment (PPE) materials identified by the Federal Emergency Management Agency's (FEMA) Temporary Final Rule (TFR) which are exempt from the ban on exportation from the U.S. can be found here.

Importing Personal Protective Equipment (PPE) and Emergency Use Authorizations (EUA) Goods has increased significantly as a result of the COVID-19 health crises. We detail for both Canada and the USA how to import such items, details surrounding their HS Classifications, ensuring that you stay compliant with both Canada and U.S. Customs here.

China Tariff Exclusions Announced

Consideration or reconsideration of tariff exclusions for medical products by the USTR. They are accepting comments through at least June 25 on the possible removal of the Section 30, 25% with respect to additional medical care products from China, including already rejected products for exclusion. Submit your comments here.

Previous Updates:

USTR has issued a notice of product exclusions to protect investors and public interest. With over $200 billion in exclusions, the list includes foods, bags, clothing, auto parts, chemicals, rubber hoses & tires, backpacks, steel and aluminum goods, printed circuit boards and more. These exclusions need to be claimed using new HTSUS 9903.88.43 and will be retroactive to Sept. 24, 2018. They are set to remain in place until Aug. 7, 2020. See complete list here.

Trusted Traveler Program (Temporarily Closed)

The closure includes all public access Global Entry enrollment centers, NEXUS enrollment centers, SENTRI enrollment centers and FAST enrollment locations. Scheduled closures are from March 19 until at least May 1, 2020.

Flag Entries with Pricing Fluctuation

Importers who are experiencing fluctuations in pricing of imported materials should flag entries in case of future reconciliation opportunity. Remember, to qualify for customs valuation pricing reductions, importers must agree to the reduction with exporter prior to export.

CBP Notifications

COVID-19 Cargo Resolution Team (CCRT) has been assembled to coordinate inquiries regarding the import of medical supplies and personal protective equipment. CCRT can be contacted here.

Previous Updates:

CBP will be issuing a notification in the coming days - through its Customs Messaging System (CSMS). CBP will release all measures to help offset the burden on importers during the COVID-19 pandemic. We are expecting this to be a presidential proclamation making 90-day extension for duty payments official.

Customs Broker License Exam on April 1, 2020 (Postponed)

CBP will provide additional information in the coming days on the CBP.gov website. Refunds are being issued to applicants.  

International

World Customs Organization

The WCO has released a HS Classification reference document for COVID-19 medical supplies, which now covers a broader range of medical equipment and supplies that have been designated as critically-needed items, they have also published a dedicated webpage to COVID-19.

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Other Helpful Information for Your Reference

 

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