Should Canada Close a Customs Loophole That Benefits Foreign Importers?

Official title: Potential regulatory amendments to the Valuation for Duty Regulations

Open Regulations & Permits Economy & Jobs Finance & Consumer
The Canada Border Services Agency wants to fix a loophole in how imported goods are valued for customs duties. Right now, some foreign companies with minimal Canadian presence can use lower prices to pay less duty than Canadian businesses importing the same goods. The proposed changes would define what counts as a 'sale for export to Canada' and ensure companies need a real presence here to benefit from certain valuation methods.

Why This Matters

Canadian businesses compete against foreign importers who may be paying less in customs duties on identical goods. That's not a level playing field. If you run a business that imports products, these rules affect what you pay at the border. Even if you don't import directly, unfair duty advantages can affect prices and competition in your industry.

What Could Change

Companies would need to meet specific criteria to be considered 'in Canada' for customs valuation purposes. They'd need a physical place of business here, Canadian bank accounts, fixed assets, and pay Canadian income tax. Consignment arrangements and certain intermediary sales would be excluded from the transaction value method. This could increase duty costs for some foreign-owned importers.

Key Issues

  • Do the revised regulations address concerns about unintended inclusion of domestic sales?
  • Are the proposed changes aligned with the World Customs Organization's Customs Valuation Agreement?
  • What criteria should determine whether a business has substantial presence in Canada?

How to Participate

  1. Review the What We Heard report from the previous consultation to understand the concerns being addressed.
  2. Complete the survey to help CBSA understand how your business values and imports goods (about 30 minutes).
  3. Email your feedback on the proposed revisions to dpsce@cbsa-asfc.gc.ca.

Submit Your Input

Complete The Importer Valuation Survey Draft Email
Questions Being Asked (4)
  1. Do the revised regulations address the key concerns raised during the initial Canada Gazette Part I consultations?
  2. How can we best ensure that the intent of the proposed regulations is achieved?
  3. Do the revisions address concerns about unintended inclusion of domestic sales as a sale for export to Canada?
  4. Do the revisions address concerns about misalignment with the Customs Valuation Agreement?

Key Documents