CAIE Report
Who is Shaping Your Customs Future?
What will the future look like for Canadian companies that move goods across Canada’s borders? Are companies actually stopping to plan and help shape this future or are they letting various governments shape this future for them? In whose hands are you putting the success of your business? Are individuals from your company involved either directly or indirectly through an association in providing input to the government in terms of the customs processes your company needs in the future? If you do not have the answer and have not asked yourself this question yet, you better soon.
Canadian companies expect certainty and have confidence that regardless of origin of supply or destination of their final product, goods will arrive on time. Companies have become familiar with the expectations and have followed the procedures put in place by the Canada Customs and Revenue Agency (CCRA) to ensure that business commitments are met. To ensure that business commitments are met in the future, companies will need to ensure that they will be operating within the new electronic environment to be mandated by CCRA. For companies who choose to stick with the status quo, their goods will be delayed at the border until the new electronic requirements will be met.
A very important piece of CCRA’s Customs Action Plan will be rolled out this spring. Phase 1 of Advanced Commercial Information (ACI), formerly Carrier Re-engineering, is targeted for May 2002 implementation. The full implementation of ACI is targeted for November 2003. How familiar are you with the new requirements? Will this new program apply to you? The purpose of this article is not to provide you with a crash course on what CCRA is doing or what some of the new detailed program requirements will be, but instead to underline the need for your involvement in helping to shape what this and a myriad of other CCRA initiatives will look like once fully implemented.
Does your company have a “security” focus for its supply chain or are you of the understanding that the security component is the responsibility of your supply chain partner(s)? It may be easier to visualize the control over the actual goods themselves but how about the control of the data that is to accompany the goods being shipped? Who will be providing the required CCRA data elements to Customs when and where they want it? Do you know whether your supply chain partners have the ability to provide the required data electronically? How well do you know your partners? These are all critical questions that must be discussed.
| "Do you know whether your supply chain partners have the ability to provide the required data electronically?” | ||
CCRA has opened numerous doors to solicit input yet Canadian companies have remained silent overall. Perhaps historically there has never been a real business need for your company to focus on the customs portion of the your supply chain activity, as there was no real financial incentive to do so. This spring, the “Grace Period” for the Administrative Monetary Penalty System (AMPS) will be expiring and non-compliance will have a direct impact on your company’s bottom line. Has your company used this “Grace Period” effectively to identify the problem areas and to correct them? Keep in mind that CCRA will require future information to be provided to them electronically. Whether you provide the required information yourself or whether you rely upon your service provider(s), the information will only be as good as the process that is set up to ensure the integrity of the data. Where data is available electronically there remains a greater likelihood that errors will be picked up by Customs and an even greater likelihood that a company will pay for these errors.
Now is not the time for Canadian companies to be complacent. It is your responsibility to familiarize yourself with the changes coming in the realm of Customs and what the new requirements accompanied by the responsibilities for your company will be. There will be no “one solution fits all” scenario and that is why it is imperative for your company’s voice to be heard. Unless CCRA receives information about some of your unique business requirements, CCRA will proceed based upon the information it has to date. Significant pressures are being placed upon CCRA by the United States to have commonality in data and processes. Some may make business sense while others may not. No one knows your business processes better than you do. Therefore you need to ensure that not only your trade chain partners are aware but also the associations that represent you before government.The future is uncertain. Business, on the other hand, needs certainty to operate. Canada needs certainty in order to ensure the continued flow of foreign direct investment. What better way to achieve this than to have business raise its voice and make its needs crystal clear by identifying the future direction of CCRA, by raising concerns and by supporting CCRA where appropriate. None of this can happen unless you get involved. By not being involved the end result will be a customs environment which may not be conducive to the survival of your business.