The following information reflects the April 19, 2024 update to the plan.
At Gallagher, our team is ready to help you as the Canada Border Services Agency (CBSA) introduces new measures for collecting duties and taxes on commercial goods imported into Canada. The CBSA Assessment and Revenue Management (CARM) digital initiative is set to revolutionize the assessment and collection process for duties and taxes on commercial goods imported into Canada.
On May 13, 2024, CARM will be released and available for use by all trade partners. However, as of the April update, CARM isn't expected to become the official system of record that importers must use to pay duties and taxes until October 2024. Until October, trade partners may continue to use their current method for providing direct financial security to clear shipments for arrival into Canada.
What is CARM?
CARM is the new program that the CBSA is in the process of instituting to streamline how duties and taxes are collected for cross border shipments. The goal is to modernize how businesses import goods into Canada.
What is the CARM Client Portal?
To help importers, customs brokers and trade consultants manage their accounting and revenue processes with the CBSA, the agency has created a self-service tool called the CBSA CARM Client Portal. This portal allows users to view their transactions and statements of account, classify goods and estimate duties and taxes.
The date that the CARM portal becomes the official system of record to pay commercial import duties and taxes has been delayed from the initial May 13 deadline and anticipated to go into effect in October, 2024. Until then, importers and other trade chain partners can continue to use their current method of providing financial security to clear their commercial goods for entry into Canada.
The CARM portal is now live, with the expectation that all importers register before October 2024 to avoid any delay of commercial goods being shipping into Canada, as they will be dependent on these significant changes after that date. With this new program, importers will take on more responsibility for their importation process, products and associated custom fees. For more information visit CARM: The new way to assess and pay duties and taxes on imported commercial goods (cbsa-asfc.gc.ca).
How does the CARM portal affect you?
Importers who register in CARM by October may benefit from the Release Prior to Payment (RPP) program financial security transition period of 180 days. During this transition period, importers will be required to meet their financial security obligations by obtaining an RPP bond or posting the required security deposit in the CARM portal. You can register on the CARM portal here CARM Client Portal.
In anticipation of the new October release date, it's important to understand that importers that don't obtain their own RPP security by October will be ineligible for RPP benefits and will have to establish ways to pay duties and taxes at the time of entry, hindering the flow of goods.
What organizations does CARM affect?
CARM is applicable to any organization that:
- Imports commercial goods as seldom as once a year
- Uses a customs broker to import commercial goods
- Imports commercial goods through a courier
- Imports goods that will later be sold
- Imports goods for any commercial, industrial, occupational, institutional, or other like use
For instance, a home-based business that offers manicures and pedicures and imports products from a supplier in the US would be affected by the changes. Another example is a manufacturing plant that imports widgets from outside Canada that relied on a customs broker for financial security; they can no longer depend on the customs broker for financial security.
This change includes businesses located outside Canada that ship goods to customers in Canada and are responsible for customs clearance and other import-related requirements; these non-resident importers (NRIs) must register on the CARM Client Portal.
What are the changes to Canada Customs for the importation of commercial goods?
| What's changing? | Before October, 2024 | After October, 2024 |
| Who's responsible for providing financial security | Approx. 90% customs brokers Approx. 10% importers |
0% customs brokers 100% importers |
| Minimum bond amount | $5,000 | $5,000 |
| Maximum bond amount | $10,000,000 | $10,000,000 |
| Bond calculation | Average monthly duties & taxes in the past 12 months | 50% of the highest monthly duties, taxes (including GST) in past 12 months |
How do you provide financial security?
You have two options for providing financial security :
- Customs bond (RPP bond): This bond is equivalent to 50% of the highest monthly account receivable, with a minimum bond amount of $5,000.
- Cash security: This option requires a security amount equal to 100% of the highest monthly account receivable, with no minimum requirement.
What is a Release Prior to Payment bond?
A RPP bond allows importers of commercial goods to provide security to the CBSA to release goods into Canada. This bond guarantees the payment of duties and taxes, allowing goods to be released from customs before payment is made. It provides importers with the ability to post security with the CBSA against the release of goods being imported into Canada.
Are you an importer of commercial goods?
If you're an importer, please complete the RPP bond application and email the completed application to the client solutions team in your region :
The bond amount must be at minimum $ 5,000 or equal to 50% of the highest monthly duties and taxes — including goods and services tax (GST) in the last 12 months.
Your Gallagher Solutions team is ready to support you in navigating the changes brought about by CARM. We have the expertise and resources to provide you with the necessary assistance. Applying for an RPP bond is a simple and efficient process. You can either complete the RPP application or reach out directly to your solutions team, whether you're an importer or a customs broker. We'll serve as your representative throughout the bond procurement process and work closely with you to ensure the protection of your release prior to payment privileges.