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Customs Terminology

Pmines Custom Services

Automated Customs Information System (ACIS): A computerized, 24-hour telephone service operated by Revenue Canada that automatically answers all incoming calls and provides general customs information.

ACROSS (Accelerated Customs Release Operations Support System): The computerized system that provides an electronic invoice to Revenue Canada to obtain release of imported goods.

B3: A Canada Customs coding form, which details the harmonized classification code used for the goods being imported. It also outlines the duty and taxes applicable to the goods, and whether NAFTA was applied to the shipment.

Bill of Lading: A document that establishes the terms and conditions of a contract between a shipper and a transportation company, and acknowledges receipt of the goods. Also see Waybill.

Bonded Warehouse: A Customs-supervised warehouse where goods are stored ("in bond") until they are released by Canada Customs.

Business Number (BN): Effective January 1, 1997 all businesses dealing with Revenue Canada are required to have a Business Number or BN to streamline processing. The BN sensibly consolidates several existing business accounts (such as GST, corporate income tax, import/export, etc. ) under one single number. To convert existing account numbers to the BN, call Revenue Canada at 1 800 959-5525 (or if calling from outside Canada, call 613-941-0100).

CADEX (Customs Automated Data Exchange Systems): A computer network that allows Brokers and Importers to electronically transmit duty and tax information to Canada Customs.

Canada Customs Act: The legislative authority for the administration and enforcement of all laws related to Canada Customs. It is a non-taxing statute.

Canada Customs Invoice (CCI): This is an invoice in prescribed form, to be completed in the prescribed format by either the importer, the exporter, or their agents. All data on the prescribed CCI is required for shipments valued over CAN$1,600.

Certificate of Origin: Many countries have customs/tariff regulations restricting the importation of goods from certain countries and limiting by country the amount of a particular commodity that can be imported. This document certifies the country of manufacture of the goods being shipped, and may allow for a favourable duty treatment for goods originating in specific countries.

Commercial Invoice: For shipments under CAN$1,600, a shipper's own commercial invoice can be used instead of the Canada Customs Invoice (CCI). However, it must contain the minimum amount of information required by Canada Customs. This is also referred to as a Pro Forma Invoice.

Consignee: The person or company to whom the goods are being shipped.

Consolidation: The act of combining many small shipments into one large shipment in order to potentially lower overall freight or brokerage rates.

Disbursement Fee: A fee charged by the broker for payment of duties and taxes by the broker when the funds are not provided by the customer in advance of shipment.

Duties and Taxes: Duties or taxes can be levied on imported goods under authority of the Customs Tariff Act, the Excise Tax Act, the Special Import Measures Act (SIMA), or any other law relating to Customs. Duty on imported goods serves as a source of revenue for local government and as a means of controlling the flow of externally produced products.

Duty Paid Value: The value at which applicable Excise Tax is calculated. It is the aggregate of Customs duties and applicable Special Import Measures Act (SIMA) assessment.

Electronic Data Interchange (EDI): The transmission of information between shippers, importers, brokers, carriers and Canada Customs by computer. Considered a step towards a paperless environment, it is a means of facilitating all types of transactions and removing communication barriers between countries.

Entry Preparation Charge: Fees charged by a broker for preparing the information required by Canada Customs on the goods being imported.

Excise Act: Provides the authority for the collection of Excise duties on alcohol, spirits, beer, tobacco and their derivatives.

Excise Tax Act: Regulates the Excise Tax charged on a limited number of items, most of which can be considered luxury goods. It also provides the authority for the Goods and Services Tax (GST) and Harmonized Sales Tax (HST).

Export and Import Permits Act: The Act is controlled and administered by the Department of Foreign Affairs and International Trade, with Canada Customs bearing the responsibility of confirming that the required permits are surrendered expeditiously for both imports and exports.

Export License: A government document issued by the exporting country, permitting the licensee to participate in the export of designated goods to certain destinations. The Export License must accompany the Application for Import Permit.

Export Permit: A document issued by the Department of Foreign Affairs and International Trade to control and monitor the exportation of designated sensitive goods, as defined in the Import/Export Act.

General Agency Agreement (GAA): Signed authorization, given by an importer, to a Customs Broker or to one of their employees to represent the importer at Customs. Also known as a Power of Attorney (POA).

Harmonized System (HS): The Harmonized Commodity Description and Coding System (or Harmonized System), is a system for classifying goods in international trade. The first six digits of the HS number classify the goods internationally, and the remaining four digits classify the goods within the importing country.

Importer of Record: The person or company responsible for payment of duties and taxes, as well as the retention of importing records.

Import Permit: A document issued by the Department of Foreign Affairs and International Trade to control and monitor the importation of designated sensitive goods, as defined in the Import/Export Act.

NAFTA (North American Free Trade Agreement): Implemented on January 1, 1994 between Canada, the United States, and Mexico to phase out duty on most goods within a ten-year period. The exporter must provide a NAFTA Certificate or Statement of Origin for goods that qualify under the NAFTA "Rules of Origin" to the importer so that they can claim NAFTA tariff preference.

Power of Attorney (POA): Signed authorization, given by an importer, to a Customs Broker or to one of their agents to represent the importer at Customs. Also known as the General Agency Agreement.

Release on Minimum Documentation (RMD): Quick Customs release can be obtained by importers or brokers with financial security on file with Canada Customs, by initially submitting minimum documentation, with full documentation being submitted to finalize the Customs Entry within five days.

Sufferance Warehouse: An in-bond area within a transportation terminal where goods are stored until they are released by Canada Customs.

Temporary Importation Entries: Under certain circumstances, Customs will permit full or partial relief of duties for particular goods imported into Canada on a temporary basis. They must be exported or destroyed under Customs supervision within a prescribed time-frame or Customs will require full duties to be paid.

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