Canadian Trade Compliance Verification Update – January 2025

February 4, 2025

In January 2025, the Canada Border Services Agency (CBSA) updated its compliance priorities regarding the classification of commercial goods imported into Canada.

General

To comply with trade regulations, importers must adhere to all the following requirements which includes:

Properly classifying goods under the correct tariff code
Accurately declaring their origin and value as per legislative rules
Paying the applicable duties and taxes

To enforce compliance, the CBSA conducts targeted verifications and establishes verification priorities. These priorities are determined through a continuous, risk-based process, with new targets introduced throughout the year while some are carried over from previous years.

CBSA Compliance, Intervention Tools and Trade Measures

The CBSA employs various tools to ensure trade compliance, including the CBSA Assessment and Revenue Management (CARM) system, which validates duties and taxes and targets areas of suspected non-compliance.

In addition to traditional trade compliance verifications, the CBSA uses three intervention tools to address different levels of non-compliance:

Trade Advisory Notice (TAN): A letter advising importers to review a declaration due to potential non-compliance, providing guidance but no monetary penalties.
Compliance Validation Letter (CVL): A request for additional information when non-compliance is suspected. Importers must respond within 30 days, and monetary assessments may follow.
Directed Compliance Letter (DCL): A notice issued alongside a monetary penalty for confirmed non-compliance.

Unlike traditional verifications, which are lengthy and review all importations over a period (typically one year), intervention tools focus on specific transactions and help mitigate risks more efficiently.

For more information, visit the CBSA webpage on Trade compliance verification.

Prepared by Nicolas Rondeau and Myriam Vallée, Andersen in Montreal (Canada)