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The Customs and Trade Administration
Blueprint was introduced in the Fall of 1998. Since then, considerable time and
effort have been committed to the development of new processes aimed at facilitating
trade in this new Millennium. Among other things, the Blueprint included a commitment
to Compliance Verification Audits and introduced the Administrative Monetary Penalty
System (AMPS). Detailed information on those issues is available upon request.
Included in this edition of the Customs Reporter are brief reviews of two other
proposals resulting from this process, both dealing with the release of shipments,
Customs Self-Assessment (CSA) and Carrier Re-engineering (CR). The focus of Customs
to reward compliance and penalize non-compliance requires that AMPS be in place
before CSA and CR can be implemented. Customs must intensify efforts to stop illegal
activity and threats to the health and safety of Canadians. Periodic audit of
the records and books of both importers and carriers will facilitate the management
of risk associated with international trade.
The business systems of approved importers and carriers will be utilized to obtain
appropriate trade data. Systems that do not incorporate the required linkages
and audit trails may need to be upgraded before applicants can be approved. Importers
must take steps to keep themselves informed and compliant or face the potentially
staggering costs associated with non-compliance. We encourage you to read on.
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What is Customs
Self-Assessment (CSA) and how will it affect us? Those are the questions we will
attempt to answer in this review.First, it is necessary to explain that, at the
time of writing, CSA is still in the conceptual design phase. The General Design
Committee, formed in September 1999, continues to fine-tune the concept. We have
compiled the following from the information available at the time of writing (early
March 2000).
Where did CSA come from?
As mentioned, CSA was an element of the Customs & Trade Administration
Blueprint released on October 21, 1998. CSA is a concept designed to allow Customs
to meet the following commitments:
• Increase Canadian competitiveness by reducing costs to business
• Contribute to increased levels of compliance
• Enhance the protection mandate by improving risk management
What is CSA?
CSA is essentially a plan to facilitate the trade of "low risk
importers" by combining new Customs release and accounting processes. While
geared to major importers, there are no restrictions on who can participate. CSA
will be made available to qualifying importers, upon completion and approval of
an application process.
Who is eligible and
what is the application process?
Any importer or carrier interested in pursuing CSA must meet several
key prerequisites:
1. Have a minimum 2-year business history with Customs. New businesses
are excluded due to the lack of a proven track record in Customs compliance.
2. Have no record of infractions (seizure; contraband; etc.).
3. Possess written Business and Customs Procedures; Audit trails and linkages
in books and records.
4. Must be a resident importer. Carrier applicants must be approved post-audit
or bonded carriers. Importer and Carrier applicants must apply individually.
5. Importers must sign a compliance agreement. Carriers must sign a Memorandum
of Undertaking re contraband.
6. Recognize and support the right of the Canada Customs & Revenue
Agency (CCRA) to perform audits.
7. Applicants who have undergone a successful Periodic Verification Audit
will benefit from a streamlined application process.
Application
for CSA is a multi-step process and will include the completion of an application
form accompanied by supporting documentation. The process will include a background
review, particularly focussing on the compliance history of the applicant to determine
the element of risk. It is also recommended that applicants provide an attestation
that their books and records provide adequate audit trails and linkages. While
not mandatory, the use of professional services is recommended. At Russell A.
Farrow Limited we have experienced professionals to assist you in preparing a
successful application.
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