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Zero-Rated Supplies

Zero-rated supplies are those on which there is no Goods and Services Tax (GST) paid by the purchaser, however, the registrant supplier of the goods may claim an input tax credit for tax paid on purchases, which were used to create the zero-rated supply.

Written Authority

The written authority is often referred to as an agency agreement or a power of attorney.

World Trade Organization (WTO)

The World Trade Organization (WTO) is an international organization. It was established on January 1, 1975, and is currently based in Geneva, Switzerland. The WTO deals with the rules of trade between nations. It is the successor organization to the General Agreement on Tariffs and Trade (GATT), which was created in 1948.

World Customs Organization (WCO)

The World Customs Organization (WCO) is an organization whose primary purpose is to facilitate the development of international trade through the improvement and harmonization of customs procedures.

Work - Canadian Goods Abroad Program

For the purpose of the Canadian Goods Abroad Program, work refers to an operation that changes the shape of a good or imparts new and different characteristics to a good that become an integral part of the good itself and did not exist in the good before the process was applied to it. For example, fabric that is exported and made into shirts is considered work since it changes the shape of a good.

Where a good retains its essential characteristics after being processed, the process is considered work if the process is a step in the manufacturing process. An operation or process that is part of the production or assembly of an unfinished good into a finished good is also considered to be work. For the purposes of the Canadian Goods Abroad Program, an alteration is considered to be work.

Wild Animal and Plant Protection and Regulation of International and Interprovincial Trade Act (WAPPRIITA)

The Wild Animal and Plant Protection and Regulation of International and Interprovincial Trade Act (WAPPRIITA) is the enabling legislation for the Convention on International Trade in Endangered Species of Wild Faula and Flora (CITES). WAPPRIITA prohibits the export of CITES controlled species without the proper permits.

Wholesaler's Licence

A wholesaler's licence ("W" licence) allows the purchase of goods (subject to excise tax) for resale without paying excise tax at the time of purchase or importation. In this case, the excise tax is collected and remitted when the goods are sold.


A warranty is a written guarantee given to a purchaser of goods. It usually states the manufacturer will provide free of charge any repairs or replacement of defective parts for a certain period of time.

Voluntary Disclosure Program (VDP)

The Voluntary Disclosure Program (VDP) is a mechanism intended to contribute to voluntary compliance with the accounting and payment of duty and tax provisions under the Customs Act, Customs Tariff Act and Excise Tax Act. Its application is limited to penalty and interest charges resulting from infractions of the provisions governing accounting and payment.


Volumetrics considers the volume of a company’s business, its size, and its compliance history when assessing penalties.


With the introduction of the Commerical Accounting Document (CAD), corrections and adjustments will be recorded as new versions of the original CAD, where the transaction number submitted on the original CAD remains for life, no matter how many versions are created.  All previous versions of the CAD are recorded in the transaction history for audit purposes.

Value for Tax (VFT)

The Value for Tax (VFT) is the value in Canadian funds plus any applicable duties, Special Import Measures Act (SIMA) assessments and excise tax. If applicable to the goods, Goods and Services Tax (GST) and Proviancial Sales Tax (PST) or Harmonized Sales Tax (HST) are payable on this amount.

Value for Duty Code

The value for duty code is a two-digit code. It is included in the import data submitted to the Canada Border Services Agency (CBSA) and indicates the method of valuation used to determine the value for duty. The first digit signifies the relationship between the vendor and the importer, and the second indicates the method of valuation used.

Value for Duty (VFD)

The value for duty (VFD) is the value upon which duty is calculated. It is not necessarily the value of the goods that has been established between the foreign vendor and the Canadian importer or the price paid for the goods.


Valuation is the process and methods used to determine the value of imported goods in order to assess duties and taxes.

Used Goods

Used goods refers to imported goods that have been entered into commerce. In order to qualify under the Obsolete or Surplus Goods Program, the imported goods must not have been used and must be in the exact same physical state from the time of entry to the time of destruction. Retail and wholesale items remaining in inventory that have not been sold at the consumer level may qualify. Used goods that do not qualify as obsolete or surplus, include rentals and customer- returned items, as those goods have been entered into commerce. The only usage permitted under the Obsolete or Surplus Goods Program is the manufacture of products from imported raw materials.

US Export Licence

A US Export Licence is an official document issued by the US Commerce Department authorizing the export of specific commodities to a specific country within a specified time period.

United States Tariff (UST)

The United States Tariff (UST) is a preferential tariff treatment extended to goods that originate in the United States and that satisfy the Canada US Mexico Agreement (CUSMA) rules of origin.

United Nations Security Council

The United Nations Security Council is responsible for maintaining international peace and security. When complaints of threats to peace are brought to the attention of the council, and an agreement for peace does not seem possible, the council will suggest means to a peaceful settlement. If a dispute leads to fighting, the council can issue cease-fire directives, send UN peacekeeping forces, or decide upon economic sanctions.

United Nations

The United Nations (UN) is an international organization of independent states based in New York City. It was established in 1945 when the representatives of 50 countries met in San Francisco to draw up a United Nations Charter. The UN advocates respect for human rights, protection of the environment and fights against disease and poverty. It also promotes international peace, security and cooperation.


An undervaluation is a contravention of section 32 of the Customs Act where goods are declared at a false value to the Canada Border Services Agency (CBSA) to evade lawfully payable duties.


An undertaking is a potential alternative to a full investigation by the Canada Border Services Agency (CBSA) and the Canadian International Trade Tribunal (CITT). It involves a commitment by exporters of dumped goods or foreign governments to change their pricing or subsidizing practices in to order to eliminate injury to Canadian industry. Undertakings provide a faster and less costly solution than the investigative process by CBSA and the CITT. There is no need to collect provisional duties when an undertaking is in effect.


Transhipment as per the Customs Tariff Act, Section 18 states:

18.(1) Notwithstanding section 17, for the purposes of this Act, if goods that are exported to Canada from a country have been transhipped in an intermediate country, the goods are deemed not to have been shipped directly to Canada from the first-mentioned country if

(a) the goods do not remain under customs transit control in the intermediate country;

(b) the goods undergo an operation in the intermediate country other than unloading, reloading or splitting up of loads, or any other operation required to keep the goods in good condition;

(c) the goods enter into trade or consumption in the intermediate country; or

(d) the goods remain in temporary storage, under any conditions as may be prescribed, in the intermediate country for a period exceeding the prescribed period.

Transaction Value Method of Similar Goods (Section 50 of the Customs Act)

When the transaction value method of identical goods cannot be applied, the method of valuation set out in section 50 of the Customs Act must then be considered. The transaction value method of similar goods is essentially the same as that contained in section 49 of the Customs Act except that the basis of value for duty is the transaction value of goods that are similar to the goods being appraised. This transaction value, which can be adjusted in the same way as shown in section 49 of the Act, would be the value for duty of the goods being appraised.

Transaction Value Method of Identical Goods (Section 49 of the Customs Act)

If the transaction value method cannot be applied, consideration must then be given to the method of valuation set out in section 49 of the Customs Act. In section 49 of the Act, value for duty is based upon the transaction value (that is, a value determined in accordance with section 48 of the Act) of goods that are identical to the goods being appraised. The transaction value method of identical goods can be adjusted if there are differences in trade level, quantities, or transportation costs between the identical goods and the goods being appraised. The value for duty of the goods being appraised would be the transaction value of the identical goods adjusted to account for the differences mentioned above.

Transaction Value Method (Section 48 of the Customs Act)

This transaction value method is the primary method of valuation. Value for duty is based upon the price paid or payable for the goods being appraised. Certain adjustments, both additions and deductions, can be made to this price to arrive at the transaction value of the goods. If the transaction value meets certain criteria for acceptability set out in subsection 48(1) of the Customs Act, it will be the value for duty. The transaction value method can only be applied in cases where the goods being appraised must be the subject of a sale for export to Canada to a purchaser in Canada.

Transaction Number Check Digit

The transaction number check digit is calculated using a formula provided by the Canada Border Services Agency (CBSA); the check digit verifies the transaction number and ensures that the number is not re-used within a specified time frame.

Transaction Number

A transaction number is a unique 14-digit number in bar-code format that is a mandatory data element on all paper release documents.

Trade Controls & Technical Barriers Bureau (TCTBB)

The Trade Controls & Technical Barriers Bureau authorizes the import and export of goods that are restricted by quotas and/or tariffs. It also monitors trade in certain goods and ensures the personal security of Canadians and citizens of other countries by restricting trade in dangerous goods and other materials.

Trade Chain Partner

Trade Chain Partner (TCP) is an enterprise that is directly involved in the importation or cross-border movement of goods imported.

Trade Agreement

A trade agreement is a legal agreement between two or more countries and is intended to provide benefits to its signatories. As well as reducing the rate of duty on imported goods, a trade agreement may also include provisions regarding:

  • government procurement (government contracts);
  • services;
  • intellectual property;
  • labour;
  • investment; and
  • the environment.
Time-Sensitive Goods

Examples of time-sensitive goods include tickets to an event, vaccines, fruit, vegetables, flowers, live animals, and meat. These are goods which will lose their value within a time frame.

Throughout the Nomenclature

"Throughout the Nomenclature" means all through the Customs Tariff.

Through Bill of Lading

A through bill of lading is a document issued by a transportation company or a carrier to a shipper. It is a contract (or receipt for goods) that describes specific terms that the shipper and carrier have agree to regarding the transportation of the goods between specific locations. It often involves multiple carriers, and multiple modes of transport.

Third Party Liability

In many cases, a service provider will pay a penalty that was issued to their client if the penalty was a result of an error made by the service provider. However, the importer remains liable and the contravention will remain on the importer's compliance record. It should be noted that in most cases the third party relies on information that is provided to them by others and that there is a responsibility on the part of the importer to ensure that the third party has all the necessary information and documentation to ensure compliance.

Test Value

A test is done to decide the acceptability of a transaction value in a sale between related persons. For example, the transaction value of identical goods or similar goods in a sale of those goods for export to Canada between a vendor and purchaser who are not related to each other at the time of the sale; the deductive value of identical goods or similar goods; or the computed value of identical goods or similar goods.

In order to use one of these values, the value must meet two criteria:

(a) the goods to which the test value relates must be exported at the same or substantially the same time as the goods being appraised; and

(b) the test value used must be the value for duty of the goods to which it relates.

Temporary Importation

Temporary importations are goods imported, under authorization by Canada Border Services Agency (CBSA), for a limited period of time and specified use.

Tariff Shift Rule

The tariff shift rules are technical rules that are applied systematically to determine the country or countries of origin to be marked on goods.

Tariff Rate Quota (TRQ)

A tariff rate quota (TRQ) is a mechanism which provides for the application of a customs duty at a certain rate to imports of a particular good up to a specified quantity, and a different rate to imports of that good that exceed that quantity, during a specified time period.

Tariff Preference Level (TPL)

A Tariff Preference Level (TPL) is a mechanism that provides for duty at a preferential rate for particular goods up to a specified quantity, and at a higher rate of duty after that quantity has been exceeded.

Tariff item - HS Classification Number

The tariff item of the harmonized system (HS) classification number is the first 8 digits of the HS classification number.


A surtax is an additional duty imposed as an emergency measure of a temporary nature, usually on imported goods causing or threatening serious injury to Canadian producers of like or directly competitive products.


Surety is defined as security against loss or fulfillment of an obligation, for example, a bond.

Supplementary Cargo Report

A supplementary cargo report is a set of data elements transmitted by a carrier or freight forwarder client to complete an Advance Commercial Information (ACI) cargo report. Data elements include detailed cargo information that is not available on the original cargo report.

Sufferance Warehouse

A sufferance warehouse is a privately owned and operated facility licensed by the Canada Border Services Agency (CBSA) for the control, short-term storage, and examination of in-bond goods until they are released by CBSA or exported from Canada.


Subsidizing occurs when goods imported into Canada benefit from foreign government financial assistance. The amount of subsidizing on imported goods may be offset by the application of "countervailing" duty. Examples of subsidies are loans at preferential rates, grants, and tax incentives.

Subheading - HS Classification Number

The subheading of a harmonized system (HS) classification number is the first 6 digits of the HS classification number.


A sub-agent is a licensed customs broker. The sub-agent is appointed by one customs broker to act on their behalf at a port where he does not have an office.

The sub-agent is the customs broker that presents “sworn-to” documents, that is, they are sworn to do work on behalf of another customs broker. The sub-agent customs broker may perform some or all of the following services for the distant customs broker:

  • receive documents from a carrier;
  • advise the distant customs broker of a shipment’s arrival at a certain port;
  • submit a release package to customs upon receipt of instructions from the distant customs broker; and
  • present the final accounting document to customs.

However, with more and more customs brokers using EDI (Electronic Data Interchange) to send data to customs, there are fewer and fewer transactions requiring a sub-agent.

Statutes of Canada (S.C.)

The Statutes of Canada (S.C.) are a compilation of all Canadian federal laws that have been passed by Parliament since 1867.


A statute is another word for an Act of Parliament or other legislature. Statutes tend to state broad principles whereas regulations elaborate on the minute details that explain the broader principles in the enacting statute.

Status Verification Interface (SVI)

To assist Customs Trade Partnership Against Terrorism (CTPAT) participants in securing their supply chain, CBP developed an electronic mechanism called the Status Verification Interface (SVI). SVI is a tool used to verify membership in CTPAT. The SVI allows consenting certified CTPAT partners to verify the participation status of other consenting certified CTPAT partners. Each party must have consented to the release of their company name to other CTPAT partners. A CTPAT "Consent to Use Company Name" waiver must be completed to permit the release of one's CTPAT status to other consenting CTPAT partners.

For security and confidentiality purposes, CBP does not share any information regarding CTPAT application or partnership status with anyone outside the company’s authorized officials.

Statistical Suffix

The statistical suffix is the last two digits of a classification number, the ninth and tenth, are the statistical suffix. The statistical suffix consists of two digits that are specifically Canadian and provide a more detailed product description that is required by Statistics Canada.

Statement of Account (SOA)

The Statement of Account (SOA) is an electronic statement for importers (excluding those under the Customs Self-Assessment Program) and licensed customs brokers that is issued on a monthly basis. The SOA displays account balances for a billing period, and includes a daily summary of accounting transactions made during the billing period that are due on the SOA payment due date, other accounting transactions that are due on their respective payment due dates and accounting transactions under review along with their respective payment due dates.


A split-shipment occurs when portions of a shipment covered by one cargo control document enter the country at different times.

Specified Rate of Interest

The specified rate of interest is the rate of interest, expressed as a percentage per year, equal to 6% per year plus the prescribed rate.

The prescribed rate of interest is the rate applied when calculating interest on payments to the federal government and is based on the average yield of Government of Canada Treasury Bills sold in the first month of the preceding fiscal quarter.

Specific Duty

Specific duty is a term for a specific dollar amount per unit, to determine the rate of duty, such as cents per kilogram.

Special Import Measures Act (SIMA)

The Special Import Measures Act (SIMA) is legislation to help protect Canadian producers from harm or injury caused when foreign exporters dump goods into Canada or when foreign governments subsidize exported goods.


Smuggling is the conveying goods or persons, without permission, across the border of a country or other political entity.

Single Window Initiative (SWI)

The Single Window Initiative (SWI) streamlines the sharing of commercial data between the Canada Border Services Agency (CBSA) and other government departments. The nine government departments and agencies that are SWI participants are called PGAs, or Participating Government Agencies.

Single Trip Bond

A single trip bond is a one-time security bond presented by a carrier used to allow a non-bonded carrier to proceed to an inland warehouse with un-released commercial goods.

Single Program Verification (SPV)

A Single Program Verification (SPV) is:

  • traditionally referred to as New Verification Process (NVP),
  • driven through priorities assigned through Head Quarters (HQ) from other program lines and regionally generated cases,
  • primarily done through desk verification (refers to not being on-site at the client’s premises), and
  • performed on-site, if deemed necessary.

SPVs look at a single issue within a sample of transactions.


A shortage occurs when the number of pieces found, by the carrier, is less than the number of pieces reported to the Canada Border Services Agency (CBSA) pre-arrival and upon arrival.

Short Pay

In special circumstances, the Canada Border Services Agency (CBSA) will permit a client/broker to short pay, for example: in the case of a glaring clerical error where the error can cause financial hardship and the client/broker can justify the delay in requesting the correction.

Ships’ Stores

Ships’ stores are goods used on board ships and aircraft in international service. Duties and taxes on these goods are not collected.


If an importer is Goods and Services Tax (GST) registered, the tax is payable when the goods are brought into a participating province. This amount is included on the importer’s Goods and Services Tax/Harmonized Sales Tax (GST/HST) return. The importer may be entitled to claim an Input Tax Credit (ITC) for the tax self-assessed on the goods depending on the percentage of used in his or her commercial activities.

If one is not registered for the GST/HST but has to self-assess the provincial portion of the Harmonized Sales Tax (HST), he or she must submit a Form GST489, Return for Self-Assessment of the Provincial Part of the HST.


A self-adjustment is a way to make an amendment to an accounting document.

Self-adjustments can be submitted to correct errors made to:

  • origin,
  • tariff classification,
  • value for duty, or
  • diversion, either of the end-use or end-user, of the imported goods.

In cases where money is owing to the Canada Border Services Agency (CBSA) or the end result is revenue neutral, self-adjustments are called a correction.


A seizure occurs when the Canada Border Services Agency (CBSA) physically takes possession of the goods, and sometimes the conveyance, when the importer or carrier is deemed to have contravened the Customs Act.


To seize means to take possession of the goods.


Goods that are of a seditious character are goods that contain depictions that advocate the use of force, without the authority of law, as a means of accomplishing governmental change within Canada.


Security is an amount of money or bond posted to ensure the payment of duties and taxes owing on imported goods.


A ruling is a decision made by the Canada Border Services Agency (CBSA) regarding the origin, value, or tariff classification of a specific item.

Rules of Origin

Rules of origin are the criteria needed to determine the national source of a product. Their importance is derived from the fact that duties and restrictions in several cases depend upon the source of imports.

When goods are not entirely produced in one country, there are specific rules included in trade agreements that are used to determine their origin for tariff treatments purposes.

Rough diamonds

Rough diamonds, sometimes called conflict or “blood” diamonds, are diamonds that are unsorted, unworked or simply sawn, cleaved (split) or bruted (being shaped by another diamond or diamond chip). Diamonds that are cut, polished and ready to be mounted, set or fitted do not fall under the provisions of the Export and Import of Rough Diamonds Act and do not require a Kimberley Process certificate.

Revised Statutes of Canada (R.S.C.)

The Revised Statutes of Canada (R.S.C.) are a consolidation of all of the Statutes of Canada. The Revised Statutes of 1985 includes all legislation that received Royal Assent up to December 31, 1984. The process of compiling these revisions is lengthy and the most recent compilation was completed in 1985, this was the sixth revision.


Periodically, the Canada Border Services Agency (CBSA) will audit or review documentation that has been submitted to them.

Revenue Summary Form (RSF)

Customs Self Assessment (CSA) importers self-assess duties and taxes and are responsible for reporting related revenues to the Canada Border Services Agency (CBSA). A daily notice/statement of account (DN/SOA) is not issued. Instead, the importer submits a monthly Revenue Summary Form (RSF) to CBSA.

Revenue Neutral

Where there is neither a payment nor a refund, the self-adjustment is called revenue neutral.

Retention Period

The retention period is the length of time a penalty stays on the importer’s compliance record.

Residual Method of Valuation (Section 53 of the Customs Act)

If all the previous methods of valuation have been examined and been found to be inapplicable to the circumstances surrounding the transaction involving the goods being appraised, the residual method of valuation is to be applied. Under section 53 of the Customs Act, a value for duty is derived from a flexible application of one of the previous methods of valuation set out in sections 48 to 52 of the Act.

Report Goods

To report goods means that the Canada Border Services Agency (CBSA) has been advised of their arrival. Although Customs Self Assessment (CSA) goods are not released at the time they enter Canada, they must still be reported to the Canada Border Services Agency (CBSA).

Repair or Alteration

Repairs or alteration can include restoration, change, addition, renovation, cleaning, or other treatment that does not destroy the identity of the goods exported or has resulted in a new or different good.


A repair is defined as a corrective maintenance such as restoration, renovation, cleaning or replacing pieces with new, or reconditioned parts. It includes adjustments made to a good to restore it to its original operating condition, and any minor physical alterations necessary to complete such restoration. Modifications that alter the original character, purpose, or function of a good, are not considered repairs. Included under the term repair are repairs, adjustments and modifications made to a product under a foreign manufacturer's warranty, providing all conditions are satisfied.


Remit means to transmit or send money to a person or place, usually for payment.


For customs purposes, remission means to be released from an obligation. In this case, an importer is released from the obligation to pay a portion of the duties. The terms “relief” and “remission” are often used interchangeably.


Relief of duty refers to the non-payment of duty that is ordinarily payable on imported goods. Duty relief most often occurs in chapter 99 of the Customs Tariff where goods are imported for specific use in manufacturing. The terms "relief" and "remission" are often used interchangeably.

Release Prior to Payment Priviledge (RPP)

The Release Prior to Payment (RPP) Privilege is a privilege that entitles importers and licensed customs brokers who have posted financial security and obtained an account security number to:

(a) obtain the release of goods from the CBSA before paying duties and taxes;

(b) defer accounting for goods; and,

(c) defer payment of duties and taxes.

Release of Goods

For non-CSA transactions, goods are released when the carrier has reported the goods and the Canada Border Services Agency (CBSA) allows the goods to move from the place of reporting to a delivery address. For Customs Self Assessment (CSA) clearances, release takes place when the goods have been delivered to the importer, owner, or consignee.

Release Notification System (RNS)

The release notification system (RNS) is an electronic Canada Border Services Agency (CBSA) system that provides the user with an automatic notification when goods have been released. It also allows the user to query the status of a particular transaction.


Goods are released once they have been authorized to be removed from a customs office, sufferance warehouse, bonded warehouse or duty free shop for use in Canada.


Regulations are laws made by persons or bodies that have been granted law-making authority. They are a form of law and are often referred to as delegated or subordinate legislation. Regulations are legally binding and usually state rules that apply in general, rather than to specific persons or situations.

Regular Goods

Regular goods are goods that are not controlled, prohibited or regulated.

Registrar of Imported Vehicles (RIV)

The Registrar of Imported Vehicles (RIV) is the company that is contracted by Transport Canada to establish and operate a national program of vehicle inspection and certification.

Regional Value Content

Regional value content requires that a certain percentage of the good’s value originates.


A refund of duty is the return of duty, or a portion of duty, paid at the time of importation. For example, a refund can be filed for duty paid on goods that were not entered under the correct tariff treatment or tariff classification, or for duty paid on goods that were shipped to Canada and later exported if they were not the goods ordered.

Receiver General for Canada

As the Receiver General for Canada, the Minister of Public Services and Procurement Canada is responsible for making payments and accepting payments for the Government of Canada as well as preparing public accounts.

Reason to Believe

Reason to believe occurs when the importer has specific information regarding the origin, tariff classification, value for duty, or diversion of imported goods that gives him reason to believe that a declaration is incorrect. Under section 32.2 of the Customs Act, the importer has 90 days to make a correction after the importer has reason to believe that the original declaration was incorrect. The obligation to make a correction ends four years after the goods are accounted for under subsection 32(1), (3), or (5) of the Act.


Under CARM, readers are able to view all transaction information on the CARM Client Portal within an RM program account for either their employer’s or importer client RM accounts, but are unable to create or edit information.


A quota is a predetermined limit on the quantity of a good that may be imported.

Quebec Sales Tax (QST)

Under an agreement reached between the federal and Quebec governments, Revenu Québec administers the Goods and Services Tax/Quebec Sales Tax (GST/QST) in Quebec. This includes the processing of applications for registration for those carrying on commercial activities in Quebec.

Quebec Sales Tax (QST) is payable only on imported casual goods; imported commercial goods are not subject to QST. Goods subject to GST are also subject to QST.

Quantitative Restriction

A quantitative restriction is a limit on the quantity of an item that may be imported.