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Customs Verification Reviews (CVRs)
The CBSA has changed the way it reviews imports and penalizes violations. In the past,
transactions were reviewed as they occurred. The CBSA now relies on a post import audit
process to review transactions and penalize violations. This process of compliance verification
reviews is called CVRs. The CBSA releases a list semi annually outlining targets for CVRs in
areas such as tariff classification, origin and valuation. This list is not exhaustive and a company
can be subject to random verifications in any or all of the three areas.
The following are some of the information the CBSA reviews when performing a CVR:
• All documentation relating to imports during the audit period, including a copy of the
purchase order, sales invoice, customs documentation, shipping documents, etc.
• Links and communication between a company’s customs department and other
departments and systems
• Written description of a company’s accounting systems and other internal controls.
The CBSA also imposes monetary penalties for importers who are in violation of customs
legislation. In most cases these penalties are assessed for violations discovered during a CVR.
The Administrative Monetary Penalty System (AMPS)
It is the responsibility of the importer and exporter of record to ensure compliance with
customs legislation is being adhered to on all import and export transactions. The AMPS is
designed to ensure compliance with customs legislation by imposing monetary penalties for
non-compliance.
The AMPS applies to contraventions of the Customs Act, the Customs Tariff, and the
regulations thereunder, as well as contraventions of the terms and conditions of licensing
agreements and undertakings. The AMPS imposes monetary penalties proportionate to the
type, frequency, and severity of the infraction. Most penalties are graduated, with consideration
being given to the compliance history of the importer or exporter. Under AMPS the first level
penalties range from $150 to a maximum of $25,000 per infraction for a single contravention;
however, if there is more than one contravention the amount may exceed CAN $25,000.
To ensure accuracy and completeness of all trade transactions, and to avoid AMPS penalties
for non-compliance, importers and exporters must have written procedures in place to ensure
declarations being made to the CBSA are accurate and complete.
Areas of responsibility include, but are not limited to:
• Release of imported goods
• Duty and GST payable
• Reporting of exports
• Documentation
• Transmission of information
• Maintenance of records
• Responsiveness to queries from the CBSA after payment.
In the majority of cases, penalties will be issued against the importer or exporter of record,
regardless of who actually committed the infraction.
International Trade and Customs—Continued
Current as of June 30, 2013
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