Saudi Arabia – Certificate of Conformity (CoC) Requirement

Administrative Monetary Penalty System

Administrative Monetary Penalty System

 

 

 

 

Minimizing the Risk of Government Penalties

Administrative Monetary Penalty System

The Canada Border Services Agency (CBSA) and the Canadian Food Inspection Agency (CFIA) use the Administrative Monetary Penalty System (AMPS) to assess penalties for non-compliance with Canada customs import and export legislation regulations.

Historically, the majority of AMPS have been assessed against importers, however, distributors and manufacturers may also be held accountable.. As a reminder, importers are ultimately responsible for the accuracy of accounting documentation as well as any AMPS penalties that may be issued for non-compliance, whether or not a customs broker is used.

On March 5, 2019, the CBSA advised that effective April 1, 2019, AMPS penalty amounts will increase for 22 contraventions related to commercial trade, in an effort to improve compliance with current trade programs. To assist in transitioning to the revised penalty structure, the CBSA will reset the penalty level, for any contravention that occurs on or after April 1, 2019, to the first level. A table listing all the impacted contraventions and their corresponding increased penalty amounts, has been provided on the CBSA Website under Customs Notice 19-05.

Published guidelines and clarification on the concept of what is considered "reason to believe", is also available in CBSA Memorandum D11-6-6. These are criteria (such as tariff classification, valuation, and country of origin) that may give an importer reason to believe that a customs declaration is incorrect. Other criteria include: formal assessments issued by the CBSA such as audit findings; final tribunal or court decisions; and customs rulings. Importers who have "reason to believe", and who do not have corrections filed within the 90-day period as required under section 32.2 of the Customs Act, will be liable for penalties under the Administrative Monetary Penalty System (AMPS). The applicable penalties are C080 through C083 and C350 through C353 and carry very high dollar amounts.

Effective April 1, 2019:

  • 1st: $500 to a maximum of $5,000 (per issue) or $25,000 (per occurrence)
  • 2nd: $750 to a maximum of $200,000 (per occurrence)
  • 3rd and Subsequent: $1,500 to a maximum of $400,000 (per occurrence)

Also, effective April 9, 2019, the Canadian Food Inspection Agency expanded the application of AMPS penalties across the entire food sector to provide better enforcement and to improve non-compliance with food safety regulations, including the Safe Food for Canadians Regulations (SFCR) which came into effect on January 15, 2019. For additional information regarding the CFIA use of AMPS, please review the Administrative Monetary Penalties section on the CFIA website.
 

To minimize your risk of AMPS, we suggest the following:

  • Declare an accurate declared value for each item. The most common valuation method is the ‘transaction value method’. This basically means that the value of the goods on the Commercial Invoice must equal the value that the purchaser has paid for the goods.
  • Provide a complete and accurate description for each item.
  • Include the Harmonized System (HS) code for each item.
  • Include the country of origin for each item (and the tariff treatment if possible) so that you can benefit from any applicable free trade agreements.
  • Ensure that all supporting documentation (i.e., Certificate of Origin) is available for the CBSA if requested.
  • Refer to the CBSA's website for current and archived Trade Compliance Verifications.

You must be in compliance with:

  • Other government departments (OGDs) requirements (i.e. licenses and/or permits required by the Canadian Food Inspection Agency (CFIA), Transport Canada, and Foreign Affairs and Global Affairs Canada (GAC)).
  • SIMA regulations for goods that are subject to anti-dumping or countervailing duties.

If you have questions regarding importing or exporting requirements, contact the CBSA and/or any OGD. If you have questions specifically about transactions that were completed on your behalf, please contact your customs broker.

Penalty Assessments

If you receive an AMPS notice from the CSBA, please review it and cross-reference it with your customs documentation. If you believe that the assessment is incorrect, you may consult with your customs broker and/or the CBSA, within 30 days of the date of your notice.

More Information

Valuation Methods
SIMA Self-Assessment Guide
Global Affairs Canada
AMPS Memorandum D22-1-1 
AMPS Information 
Customs Act
Understanding the Safe Food for Canadians Regulations: A handbook for food businesses