Proposed Canadian Regulatory Amendments to the Valuation for Duty Regulations

blog | Oct 27, 2023

The Canada Border Services Agency (CBSA) ran a consultation from May 29th – July 26th where they welcomed feedback from importers, brokers, Canadian retailers and any other interested stakeholders. 

The focus of the consultation was the CBSA’s proposed amendments to the Valuation for Duty Regulations; to strengthen the statutory and regulatory frameworks governing the methods of determining the value for duty (VFD) of imported goods. 

The Proposed Amendments are to: 

  • Help Canadian importers compete with non-resident importers (NRIs) which are businesses located outside of Canada that ship goods to customers in Canada 
  • Clarify which sale is to be used to calculate the duty on imported goods to address a regulatory gap that benefits NRIs by  

(i) defining the term "sold for export to Canada" 

(ii) amending the definition of the term "purchaser in Canada" 

  • Align with international obligations established at the World Customs Organization 
  • Reflect modernized business practices 
  • Provide greater certainty and predictability for the importing community 
  • Give the CBSA the authority to enforce the collection of the correct amount of revenue from import duties owed to the Government of Canada on lower value for duty declarations 

What the CBSA Heard: 

Canadian importers and trade chain partners support the policy intentions behind the regulatory amendments, notably to ensure that, in a series of sales, the last sale to the buyer in the country of import (Canada) and not an earlier sale between two foreign entities is used as the basis for determining the value for duty. 

However, substantial feedback was received concerning the proposed regulations' intent to potentially apply to domestic sales. The policy objective is not to use a price in a sale between a Canadian resident importer and its Canadian customer as the basis for determining the value for duty. 

The CBSA will continue to review all submissions and take them into consideration for further amendments to the proposal. They will communicate directly with respondents, if required, and produce a summary that we will publish in the coming months. 

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