The Canada Border Services Agency (“CBSA”) has issued formal notice that it is stepping up enforcement against exporters regarding their obligations to properly report exports from Canada with new audits focusing on exports of product moving in transit through the United States. It is understood that particular, although not exclusive, attention will be paid to automotive exports moving through the United States to Mexico and other countries.

Reporting requirements have long been a potential source of confusion for exporters of product from Canada. All who export to the United States should be carefully reviewing their reporting practices to ensure they are in full compliance with Canadian law and consider whether they ought to be coming forward to disclose violations during CBSA’s “grace period” in order to avoid the imposition of penalties...

...Canadian and non-resident exporters should be reviewing their export practices during 2015 and the previous six years to confirm compliance with export reporting requirements, and in particular with respect to exports to the United States that subsequently transit through to other countries. If any non-compliance is discovered, careful consideration should be given to potential penalty exposure and determining whether a voluntary disclosure is appropriate in the circumstances.

This has been excerpted from 18 November 2015 article by John W. Boscariol, Helen Fotinos, Robert A Glasgow of McCarthy Tétrault LLP.