TEMPORARY ENTRY OF GOODS INTO CANADA
Richard Vinson
Every day in Canada, innumerable commercial items enter the country on a
temporary basis. Canadian Customs officers are very familiar with temporary
entries, and U.S. exporters, as well as Canadian importers, should be prepared
with some basic background knowledge of what to expect when goods are being
brought into Canada but will be returned to the United States at a later date.
Considerable resources to determine entry status and procedure are available via
the Internet, the Canada Customs and Revenue Agency (CCRA), and through private
sector customs brokers. U.S. companies bringing goods into Canada on a temporary
basis would be well served to utilize these resources in order to expedite
entry, avoid any unnecessary procedural delays, and to best serve their clients
and interests in the Canadian market.
Note: Since the following is intended to act as a guideline only, and, where
regulations are known to change, the U.S. Commercial Service (USCS) assumes no
responsibility for the outcome of any Temporary Import transaction undertaken by
either a resident or non-resident importer. If new to export, the USCS
recommends that you check first with either a Customs Broker or with CCRA (see
Contacts and web sites), for information relevant to your situation.
What Qualifies as a Temporary Import?
As of 11/30/00, Canada lists 57 classes of goods, which qualify for temporary
import.
Some of those classes include:
- Trade show booths and supplies;
- Items coming back to Canada for repairs;
- New products being evaluated or tested;
- Samples for use in soliciting sales
- Goods entering on short notice for some type of emergency.
CCRA has produced an excellent publication, Memorandum D8-1-1 available on
this subject. This publication covers the 57 classes in detail and provides
numerous reference points and interpretations related to bringing in a temporary
import.
Memo D8 1-1 Temporary Importation (Tariff Item No. 9993.00.00) Regulations:
http://www.cbsa-asfc.gc.ca/E/pub/cm/d8-1-1/d8-1-1-e.pdf
Any importer, which could be a U.S. business person traveling to Canada, or
customs broker may consider classifying goods that will be imported temporarily
under tariff item No. 9993.00.00. Generally, all goods being imported
temporarily, so long as they are not being imported for sale, lease, further
manufacturing, or processing, will qualify for duty-free entry under tariff item
No. 9993.00.00. For products of low value and where leaving the products in
Canada would not incur a relatively high expense, the importer of record may
wish to enter the goods on a permanent basis rather than go through the
temporary import process.
What kind of paperwork is required?
For those goods that qualify, a "Temporary Admission Permit" (Form
E29B) will be required. When goods are imported for a temporary period on Form
E29B, the customs office of importation, usually at the port of entry, may
require a refundable security deposit. Full details on the permit and how it can
be used to facilitate a temporary import can be found at http://www.cbsa-asfc.gc.ca/E/pbg/cf/e29b/README.html.
This permit must be cancelled in order to document and prove that the goods
actually left Canada. This permit is only available in hard copy at the port of
entry. A B3 accounting document may also be required, depending on the goods
being imported. (See Broker - Special Note below)
Would an A.T.A. Carnet apply to Canada?
Yes. Carnets are international customs documents designed to simplify and
streamline customs temporary entry procedures. For U.S. goods entering Canada on
a temporary basis, the carnet would be acquired by the U.S. company, possibly on
the advice of the Canadian importer. Carnets are particularly useful for goods
which will be imported into more than one country during the period of validity
of the carnet. The carnet has a dual role of replacing the national temporary
entry documents and providing a guarantee for duties that would be payable
should the goods imported not be re-exported within the time period allowed by
customs. Consequently, carnets eliminate the requirement to post security with
customs.
The use of a carnet for the importation, exportation, or transit of goods
does not exempt those goods from the application of Canadian customs laws,
regulations and procedures. Goods will not be released on a carnet unless the
goods qualify for temporary entry and the required documents or certificates are
produced. A complete explanation and overview of Canada's carnet policy and
regulations can be found at http://www.ccra-adrc.gc.ca/menu/EmenuKCI.html
(Memorandum D8-1-7).
Another useful reference for U.S. companies is the information provided by
the United States Council for International Business. That organization's web
site is complete with forms, pricing, applicable countries and considerable
background on the process and when and how the carnet can be best used. See: http://www.uscib.org/.
You may also wish to check the companion MDEC IT Guide: CARNET.
Do I need a Broker?
This is a business decision of the company responsible for the import;
however, most firms importing a product on a temporary basis should seriously
consider the advantages of using a broker to look after the details. For the
amount charged by the broker, the saving in company staff time and resources can
often be immeasurable if the process doesn't work out exactly as expected. Most
brokers are quite familiar with this process and will bring their resources to
bear in order to expedite the import.
Special note: A broker can be especially useful in that arrangements must be
made for the formal cancellation of the Temporary Admission Permit. This is
essential to document the goods actually leaving Canada. If this is not
completed, the importer of record may have to forfeit security deposits or other
funds paid which would otherwise be refundable.
If you haven't dealt with Customs House Brokers before,
you may wish to check out the companion MDEC IT Guide: Questions for Your Forwarder.
Many of the same considerations hold true.
What will Canada Customs expect to see with the shipment?
In addition to the Temporary Admission Permit, make sure that there is an
invoice in the shipment (or available if the goods are being hand-carried),
stating the correct value and nature and use of the goods as well as a comment
to the effect that the goods are coming into Canada on a temporary basis and for
what length of time if possible. At the time of importation, the importer must
specify what the goods will be used for while in Canada.
What about NAFTA?
Under the North American Free Trade Agreement (NAFTA) certain provisions
apply as per the following:
"NAFTA provides for the duty-free importation of certain commercial
samples and printed advertising materials. The commercial samples must be of
negligible value (i.e. their value cannot exceed one U.S. dollar, or the
equivalent in the currency of Mexico or Canada), or they must be marked, torn,
perforated, or otherwise unsuitable for sale or use except as commercial
samples. Only printed advertising materials classified in Chapter 49 of the
Harmonized Tariff Schedules can be imported duty-free under this provision. The
list includes brochures, pamphlets, leaflets, trade catalogues, and
yearbooks."
What's covered under NAFTA "Temporary admissions"?
The NAFTA requires Canada, Mexico and the United States to grant duty-free
temporary admission to certain classes of goods imported from another NAFTA
country. Duty-free entry cannot be conditioned on whether directly competitive
or substitutable goods are available in the importing country. In addition, the
goods do not have to originate in a NAFTA country.
1. Professional equipment (tools of the trade), trade show
displays
A person can temporarily import, duty-free, the following goods: professional
equipment (tools of the trade); equipment for the press or for sound or
television broadcasting; cinematographic equipment; goods for sports purposes;
and goods for display or demonstration. As a condition of duty-free entry, these
goods:
- must not be sold or leased while in Canada;
- must be accompanied by a bond if they are not originating goods, as
defined in Chapter 4 of the NAFTA;
- only remain in Canada until the departure of the person, or within a
reasonable time;
- be capable of identification when exported;
- be imported in no greater quantity than is reasonable for their intended
use;
- be imported by a national or resident of the United States or Mexico,
seeking temporary entry;
- be used solely by or under the personal supervision of the person
importing the good in the exercise of the business activity, trade or
profession.
Be aware that although professional equipment is duty-free, it may still be
subject to the Canadian goods and services tax (GST).
2. Commercial samples and advertising films
Commercial samples and advertising films can also be imported temporarily
into Canada without the payment of duties. As a condition of duty-free entry,
the goods must:
- be imported solely for soliciting orders for goods or services from
another country;
- not be sold, leased, or put to any use other than exhibition or
demonstration, while in Canada;
- be capable of identification when exported;
- be exported within such period as is reasonably related to the purpose of
the temporary admission; and
- be imported in no greater quantity than is reasonable for their intended
use.
What should be expected for after-sales service or other service providers?
No customs duties are assessed on goods that are exported for repair or
alteration, free of charge and pursuant to a warranty, to the United States or
Mexico and then reimported into Canada. This is true regardless of the origin of
the goods and regardless of whether the goods could have been repaired or
altered in Canada. Be aware, however, that Canada applies customs duties on the
value of repairs or alterations whenever a charge is levied
Where can I get detailed information?
To ensure a smooth entry into Canada with some type of temporary import,
preparation is the key. The following web sites, produced by the Government of
Canada, are excellent sources of information on this subject.
Implications for U.S. Business:
The temporary import process should be explored well before any trip to
Canada. Although there are numerous goods which qualify, a review of the web
sites and literature described above will help to detour any issues or
situations which might delay an entry into the country. For events in Canada
organized by the U.S. Commercial Service (CS Canada) there are often
arrangements made for the participants which can smooth out the entry. This is
also often the case for trade show participants where the event will have a
broker of record. The temporary import process, like any customs procedure, may
require additional resources at the onset, but, after the first entry, will
usually become a fairly routine exercise in building your market in Canada.
CONTACT US!
For more information on doing business in Canada, U.S. companies should
contact CS Canada or their nearest office of the US Commercial Service (http://www.export.gov/). We offer a variety of resources and services (including market
research, agent/distributor searches, corporate matchmaking, etc.) To assist
U.S. exporters of non-agricultural products entering new markets. The Canadian
market, in particular, represents a good "first step" for
new-to-export companies seeking a new and exciting opportunity, and we welcome
the chance to assist you. Think "Canada First!"
CS offices in Canada can be contacted at the following telephone numbers: CS
Halifax, (902) 429-2482; CSQuebec, (418) 692-2087; CS Montreal, (514) 398-0673;
CS Ottawa, (613) 688-5217; CS Toronto, (416) 595-5414; CS Calgary, (403)
265-2116; and CS Vancouver, (604) 685-3382. CS Canada is also on the World Wide
Web at: http://www.buyusa.gov/canada/en/.
Other MDEC IT Guides
You may wish to review the following related guides:
- Canada WebGuide - compiled by the
Ypsilanti U. S. Export Assistance Center, is meant to provide an overview
into the many sources of information which must be considered in making a
business decision.
- Is it There Yet? - The single most important question asked of Canadian
Customs House Brokers is "Has my shipment been released?"
- NAFTA Certicficate of Origin
- Learn how to complete the basic document for trade with Canada and Mexico
and where to download copies of the form.
- You Want
to Sell in Canada, Eh? - Canada represents the largest market
for Michigan exporters. This handy guide will help you to either enter
the market or expand your existing sales.
Date
Updated: March 27, 2007
[ Canada - Mandatory HS Requirement ] [ Canada - Temporary Entry Requirements ] [ Canada - The FAST Program ] [ Carnet - How Merchandise Passports can Unlock Customs ] [ Carnet - Your Product's Passport ] [ Classifying Your Products for Export ] [ EEC Wood Packaging Requirements ] [ Fundamentals of Export Documentation ] [ Hazardous Materials Exports ] [ Identifying HS Schedule B Numbers ] [ NAFTA Certificate of Origin ] [ Pre-Shipment Inspection ] [ Repair and Warranty Re-Exports ] [ Shippers Export Declaration ] [ Temporary Entry Made Easy ] [ Unofficial USEAC BIS Guide ]
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