Industry News
CBSA Re-evaluates Dutiability of Certain Post-Importation Charges
TweetSeptember 3, 2009
In June 2009, the Canadian government approved a change to its Customs Act requiring that certain subsequent proceeds be added to price paid or payable for the purposes of calculating value for duty. The Canadian Border Service Agency’s (CBSA) guidelines regarding the change in law are published in Memorandum D13-4-13.
Importers, particularly those dealing with related party sales into Canada, should pay close attention to CBSA’s new interpretation of “subsequent proceeds.” According to CBSA, “subsequent proceeds” includes “any type of payment made by a purchaser after the importation of goods into
As an example, CBSA’s Memorandum analyzes whether management or administrative fees should be dutiable. Historically, CBSA had held that such charges were not part of the transaction value of imported merchandise. However, according to the change in law, such amounts “may meet the criteria to be subsequent proceeds, since the payments are remitted to the vendor after the importation of goods and they are often based on the resale, disposal, or use of the goods in
· the services were rendered to operate a business in Canada
· the amount of the charge was in accordance with an arm’s length agreement
· the services provided are “justified” for operating the business in
As a result, multi-national importers may need to revisit the valuation of their merchandise imported into