We’ve previously posted details regarding the Canada Border Service Agency (CBSA) Assessment and Revenue Management (CARM) project. Last week, Carson International hosted another webinar addressing these changes, as well as offering information pertaining to customs verification audits. We attended this session to gather details we could share with our clients and readers.
Dan Kiselbach (partner, Miller Thomson) and Dave Pentland (VP, Carson International) spent Thursday afternoon reviewing the requirements for a customs verification audit and offering updates on the CBSA’s CARM project.
CARM’s goals include simplifying and modernizing the reporting process, reducing the cost of importing to Canada, and ensuring consistent compliance with trade rules. CARM Phase 1 included the launch of the online client self-serve portal and was implemented May 25, 2021; Phase 2 is scheduled for release in the spring of 2022 and will feature electronic accounting, appeal, and compliance management, as well as harmonized billing cycles. However, the most significant part of CARM’s Phase 2 is the changes to the release-prior-to-payment requirements for bonds. Under Phase 2, the importer can no longer use their customs broker’s RPP security to clear shipments and receive release prior to accounting and duties/tax payments.
A successful customs verification audit rests on a few things – keeping proper records, responding to the auditor ASAP, assigning audit-related duties to an appropriate team, seeking timely advice on ‘gray’ areas, and being ready to support your position (in writing or in person) before the deadline. Consequences of a failed audit may include additional duties and/or monetary penalties, seizure/forfeiture, and increased border scrutiny; a successful audit virtually guarantees that it will be a long while before the next one, so preparation is paramount.
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