Glossary

Looking for a term or acronym you're not familiar with? Find it in this glossary! If there is a term we're missing, let us know at cscb@cscb.ca.
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Term Definition
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 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 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.

Temporary Importation

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

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.

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.

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.

Throughout the Nomenclature

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

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.

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.
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 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.

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.

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 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 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 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.

Transhipment

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.

Undertaking

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 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.

Undervaluation

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.

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.

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 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.

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.

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.

Valuation

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

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.

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 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 Provincial Sales Tax (PST) or Harmonized Sales Tax (HST) are payable on this amount.

Version

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.

Volumetrics

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

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.

Warranty

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.

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.

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 Fauna and Flora (CITES). WAPPRIITA prohibits the export of CITES controlled species without the proper permits.

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.

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.

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.

Written Authority

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

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.

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