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CBSA Trade Verification Priorities updated for 2019
Your chances of being selected by the Canada Border Services Agency (CBSA) for trade compliance verification are higher if you import products on the following listofpriorities, updated this month.
The latest semi-annual list identifies products that are of concern which, due to misclassification, have led to a loss of revenue for the CBSA. Non-compliant companies will have to pay retroactive duties and, potentially, Administrative Monetary Penalties.
It includes many items that have appeared on previous lists for which new rounds have been implemented and two new products:
- Furniture for Non-Domestic Purposes (Round 3)
- Footwear ($30 or more per pair) (Round 4)
- Articles of Plastics (Round 3)
- Parts of Lamps (Round 3)
- Safety Headgear (Round 4)
- Import Permit Numbers (Round 2)
- Parts of Machines and Mechanical Appliances (new)
- Other Chemical Products (new)
Chapters 2 and 4 remain on the tariff classification list for Import Permit Numbers. The risk identified is that imported goods could be classified under “within access commitment” tariff items within Chapter 2 (meat of bovine animals and poultry) and Chapter 4 (dairy products), without the required import permit number on the declaration.
The next list of priorities is expected in January 2020.
For more information, contact Brian Rowe, Director – Customs Compliance & Regulatory Affairs.
U.S. CBP ramps up issuing of penalties
for non compliant ISF Filing
U.S. Customs and Border Protection (USCBP) has begun full enforcement of Import Security Filing – ISF 10 +2 and ISF 5 – regulations, including the issuing of penalties for non-compliance. The following details outline the regulations and requirements of these mandates.
ISF 10+2
ISF 10+2 is a regulation approved at the end of 2008 by the USCBP. The regulation requires certain information to be declared about cargo in containers bound for import into the United States by ship. It does not apply to air or truck freight, nor does it apply to bulk shipping cargo. This function is typically completed by the importer of record’s customs broker. Since July 9, 2013, the regulation has been fully applied, with no flexibility around the imposition of penalties. The information has to be submitted 24 hours before loading of vessel destined to the United States.
The name 10+2 refers to the information the exporter and importer should communicate about the cargo (10 items), as well as information regarding the stowage plan and container status (2 items). The declaration can only be made electronically.
10 items:
- Importer Registration Number
- Consignee Registration Number
- Seller details
- Buyer details
- Ship-to party
- Manufacturer or supplier details
- Country of origin
- Tariff heading, according to the Commodity Harmonized Tariff Schedule
- Details of where the container was packed
- Consolidator (container packer) details
2 items:
- Ship stowage plan
- Container status messages
ISF 5
For ocean cargo travelling as Freight Remaining on Board (FROB), Immediate Exportation (IE) or Transport and Exportation (TE), ISF 5 filing must be submitted electronically 24 hours before loading of vessel destined to the United States. This function is typically completed by the ocean carrier or booking party at origin. Since March 15, 2019, the regulation has been fully applied, with no flexibility around the imposition of penalties.
5 items:
- Booking party
- Foreign port of unlading
- Place of delivery
- Destination/Ship to party
- Harmonized tariff schedule number
Consequences of non-compliance with ISF 10+2 & ISF 5 regulations
There are four types of non-compliance:
- Not making the declaration
- Making a mistake or submitting an incomplete declaration
- Submitting a declaration after the deadline
- Not cancelling a declaration, e.g., if cargo changes destination or is abandoned
In all of the above cases, the prescribed sanctions range from a minimum of $5,000 USD per declaration to a maximum of $10,000 USD (if there is more than one type of non-compliance). However, Customs authorities can take certain factors into consideration to reduce the amount, such as the percentage of incorrect declarations, measures taken by the importer to rectify the non-compliance, circumstances beyond the control of those making the declaration, incorrect information having been supplied by someone in the logistics chain, etc.. In the first scenario, Customs authorities can also withhold the cargo until the declaration is submitted.
For more information, contact David Lychek, Manager – Ocean & Air Services.
Universal Logistics at the forefront
of Export Reporting to CBSA
As announced by the Canadian Border Services Agency (CBSA) earlier this year, the Canadian Export Reporting System (CERS) is going to replace the Canadian Automated Export Declaration (CAED) system, which is the existing electronic export filing system. The expected go live date for CERS is December 8, 2019, with a client onboarding period between January 2020 to June 2020, culminating with the decommissioning of CAED on June 30, 2020. Also on this day, the CBSA will eliminate the paper reporting process Export Declaration form (B13A) and implement mandatory electronic reporting for exporters.
In order to initiate this process, the CBSA has created the CERS Pilot Working Group (PWG). The PWG represents the CBSA, Statistics Canada and Trade Chain Partners. Universal Logistics, represented by Debbie McGuire and David Lychek, has been appointed as part of this group, under the Trade Chain Partner category.
As per Debbie McGuire, “This will allow us to become early adopters of this system, which will give us valuable insight into the program prior to the full onboarding of the export community. This enables us to ensure the transition to the new program is seamless, which will benefit our clients who rely on us to arrange their export declarations”.
For more information, contact David Lychek, Manager – Ocean & Air Services.
Ocean freight market facing volatility
The current container market is facing more than its share of disruptions, notably due to the U.S.-China trade war, increasing tensions in the Middle East and the new emission regulation. We saw peak shipping volumes in early May/June which were spurred by the protectionist tariffs implemented by the U.S. on China origin goods. This led to a space shortage, as shippers rushed to export their shipments to avoid the high tariffs.
Since the trade truce agreed to by the U.S. and China at the June 28/29 G20 Summit meeting, the urgency to ship has somewhat subsided. The steamship lines had implemented blank sailings over the last month to remove capacity from the market to keep their rates from declining. However, with the uncertainty of the U.S. political machine, shippers in China are nervous as they are not sure when the trade policy may change again, so peak season remains very unpredictable. Coupled with the reduction of sulphur in bunker fuel (IMO 2020), this creates volatile fuel prices. This year will most certainly prove to be a very interesting and challenging one for shipping oceanfreight.
For more information, contact Debbie McGuire, Manager – Freight Solutions.
Rules controlling drive time for U.S. truckers set to be relaxed
The U.S. Department of Transportation is moving towards relaxing the rigid “hours of service” rules, which has been a long sought goal of the trucking industry.
The regulations, enforced by the Federal Motor Carrier Safety Administration (FMCSA), currently limit long-haul truckers to 11 hours of driving time within a 14-hour on-duty window. They must have had 10 consecutive hours off duty before the on-duty clock starts and must take a 30 minute break prior to driving for eight hours.
Paper logs were quite easily fudged but with the introduction of electronic logging devices (ELDs) in December 2017, the off-duty and on-duty time for most truckers is recorded automatically and precisely. Breaking the rules can be very costly for drivers.
There are opposing views on relaxing the “hours of service” rules. The American Trucking Association, whose members include the nation’s largest motor carriers, and The Owner-Operator Independent Drivers Association, which has 160,000 members plus other interest groups representing motor carriers and truck drivers, contend the ELDs have only highlighted the inflexibility and complexity of the regulations. They also view the current driving schedules as out of step with the daily realities confronting most of their members.
Often, heavy traffic, foul weather and long waits for cargo to be loaded or unloaded keep truck drivers idle while the 14-hour clock keeps on ticking, pushing them to go faster to make up lost time. The above mentioned associations are recommending that truckers be allowed to effectively stop the 14-hour clock for up to three consecutive hours. During this off-duty period, drivers could rest or simply wait out heavy traffic. They are also pushing for the 30-minute mandatory break requirement to be eliminated, as it forces drivers to pull over when they don’t really need to rest.
On the opposing side, highway safety advocates, including insurance companies and consumer, public health and safety groups, are warning the contemplated changes would dangerously weaken the regulations, resulting in truckers putting in even longer days at a time when driver fatigue is often at fault in fatal crashes involving large trucks. Instead of relaxing the existing laws, the priority should be on pushing forward with new safety technologies such as software that electronically limits a truck’s speed.
Perhaps a compromise will be found, but the FMCSA will have their work cut out trying to find one which satisfies both sides.
For more information, contact Lisa Fertita, General Manager – Freight Services.
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The above image shows one of
the city’s famous landmarks.
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How many clues do you need to name a city that has 3 Unesco World Heritage sites
- This city has more canals than Amsterdam or Venice, connected by 1,700 bridges.
- The city has the world’s largest Turkish population outside of Turkey.
- The public transport system travels 8.7 times around the Earth every day and almost half of it lies underground.
- This city’s most famous bakery treat is a donut filled with jam.
- There are more museums than rainy days per year – 180 museums versus an average of 106 rainy days per year.
- The city’s Holocaust Memorial is a memorial to the Jewish victims of the Holocaust, consisting of a 4.7-acre site covered with 2,711 concrete slabs.
- The city was divided after World War II and its subsequent occupation. Following reunification in 1990, it once again became the capital of the country.
 See the answer
For more information about shipping freight to or from this city, contact Debbie McGuire, Manager – Freight Solutions.
How to avoid shipping mistakes
Avoid unnecessary shipping complications by following these simple tips:
- Carefully count every piece when loading or unloading shipments to ensure the order matches the paperwork.
- Document any visible damage on the sign-off receipt.
- When you receive a shipment, make sure you are getting what you paid for.
- When you send a shipment, avoid short payments of your invoices by ensuring every piece of cargo is shipped.
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Lukas Hamann, Team Leader – Border Clearances
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At Your Service: Lukas Hamann, Team Leader – Border Clearances
Since joining Universal Logistics in 2016 as a member of the Head Office Customs Operations team, Lukas Hamann has obtained his Canadian International Freight Forwarders (CIFFA) Certificate and Certified Customs Specialist (CCS) designation. In October 2017, he successfully completed the Customs Brokers Professional Examination.
Last month, Lukas was promoted to the role of Team Leader – Border Clearances. In his new role, Lukas will focus on providing support to Customs Operations personnel and Branch teams and is responsible for truck, courier and rail clearances.
Lukas can be reached by phone at (905) 882-4880, ext. 235 or by email. |
