Every day in Canada, innumerable commercial items enter the country on a temporary basis. Canadian Customs officers are very familiar with temporary entries, and first-time Canadian importers should be prepared with some basic background knowledge of what to expect when goods are coming into Canada but will be returned to the United States at a later date.
Note to viewer: If new to import, check first with either a Customs Broker or with Canada Border Services Agency (CBSA), for information relevant to your situation. Since the following is intended to act as a guideline only, the U.S. Commercial Service assumes no responsibility for the outcome of any Temporary Import transaction undertaken by either a resident or non-resident importer.
What Qualifies as a Temporary Import?
Any importer or customs broker may consider classifying goods that will be imported temporarily under tariff item No. 9993.00.00. Generally, all goods being imported temporarily, so long as they are not being imported for sale, lease, further manufacturing, or processing, will qualify for duty-free entry under tariff item No. 9993.00.00. For products of low value and where keeping the products in Canada would not incur a relatively high expense, the importer may wish to enter the goods on a permanent basis rather than go through the temporary import process.
As of 11/30/00, Canada lists 57 classes of goods, which qualify
for temporary import.
Some of those classes include:
- Trade show booths and supplies;
- Items coming back to Canada for repairs;
- New products being evaluated or tested;
- Samples for use in soliciting sales;
- Goods entering on short notice for some type of emergency.
CBSA has produced an excellent publication, Memorandum D8-1-1 available on this subject. This publication covers the 57 classes in detail and provides numerous reference points and interpretations on the details related to bringing in a temporary import:
Temporary Importation of Goods to Your Event (Tariff Item No. 9993.00.00)
What kind of paperwork is required?
For those goods that qualify, a Temporary Admission Permit (Form E29B) will be required. When goods are imported for a temporary period on Form E29B, the customs office of importation may require a refundable security deposit. Full details on the permit and how it can be used to facilitate a temporary import can be found here . This permit must be cancelled in order to document and prove that the goods actually left Canada. (See Broker - Special Note below)
Would an A.T.A. Carnet apply to Canada?
Yes. Carnets are international customs documents designed to simplify and streamline customs temporary entry procedures. For U.S. goods entering Canada on a temporary basis, the carnet would be acquired by the U.S. company, possibly on the advice of the Canadian importer. Carnets are particularly useful for goods, which will be imported into more than one country during the period of validity of the carnet. The carnet has a dual role of replacing the national temporary entry documents and providing a guarantee for duties that would be payable should the goods imported not be re-exported within the time period allowed by customs. Consequently, carnets eliminate the requirement to post security with customs.
The use of a carnet for the importation, exportation, or transit of goods does not exempt those goods from the application of Canadian customs laws, regulations and procedures. Goods will not be released on a carnet unless the goods qualify for temporary entry and the required documents or certificates are produced. A complete explanation and overview of Canada's carnet policy and regulations can be found in http://cbsa-asfc.gc.ca/publications/dm-md/d8/d8-1-7-eng.pdf.
This is a business decision of the company responsible for the
import; however, most firms importing a product on a temporary
basis should seriously consider the advantages of using a broker
to look after the details. For the amount charged by the broker,
the saving in company staff time and resources can often be
immeasurable if the process doesn't work out exactly as
expected.
Most brokers are quite familiar with this process and will bring
their resources to bear in order to expedite the import.
Special note: A broker can be especially useful in that arrangements must be made for the formal cancellation of the Temporary Admission Permit. This is essential to document that the goods actually left Canada. If this is not completed, the importer of record may have to forfeit security deposits or other funds paid which would otherwise be refundable.
What should I tell the U.S. company to include in the shipment?
Make sure there is an invoice in the shipment stating the correct value and nature and use of the goods as well as a comment to the effect that the goods are coming into Canada on a temporary basis and for what length of time if possible. At the time of importation, the importer must specify what the goods will be used for while in Canada.
What about NAFTA?
Under the North American Free Trade Agreement (NAFTA) certain provisions apply as per the following:
"NAFTA provides for the duty-free importation of certain commercial samples and printed advertising materials. The commercial samples must be of negligible value (i.e. their value cannot exceed one U.S. dollar, or the equivalent in the currency of Mexico or Canada), or they must be marked, torn, perforated, or otherwise unsuitable for sale or use except as commercial samples. Only printed advertising materials classified in Chapter 49 of the Harmonized Tariff Schedules can be imported duty-free under this provision. The list includes brochures, pamphlets, leaflets, trade catalogues, and yearbooks: More information on NAFTA
What's covered under NAFTA "Temporary admissions"?
The NAFTA requires Canada, Mexico and the United States to grant duty-free temporary admission to certain classes of goods imported from another NAFTA country. Duty-free entry cannot be conditioned on whether directly competitive or substitutable goods are available in the importing country. In addition, the goods do not have to originate in a NAFTA country.
1. Professional equipment (tools of the trade), trade show displays
A person can temporarily import, duty-free, the following goods: professional equipment (tools of the trade); equipment for the press or for sound or television broadcasting; cinematographic equipment; goods for sports purposes; and goods for display or demonstration. As a condition of duty-free entry, these goods:
- must not be sold or leased while in Canada;
- must be accompanied by a bond if they are not originating goods, as defined in Chapter 4 of the NAFTA;
- only remain in Canada until the departure of the person, or within a reasonable time;
- be capable of identification when exported;
- be imported in no greater quantity than is reasonable for their intended use;
- be imported by a national or resident of the United States or Mexico, seeking temporary entry;
- be used solely by or under the personal supervision of the person importing the good in the exercise of the business activity, trade or profession.
Be aware that although professional equipment is duty-free, it may still be subject to the Canadian goods and services tax (GST).
2. Commercial samples and advertising films
Commercial samples and advertising films can also be imported temporarily into Canada without the payment of duties. As a condition of duty-free entry, the goods must:
- be imported solely for soliciting orders for goods or services from another country;
- not be sold, leased, or put to any use other than exhibition or demonstration, while in Canada;
- be capable of identification when exported;
- be exported within such period as is reasonably related to the purpose of the temporary admission; and
- be imported in no greater quantity than is reasonable for their intended use.
What should be expected for after-sales service or other service providers?
No customs duties are assessed on goods that are exported for repair or alteration, free of charge and pursuant to a warranty, to the United States or Mexico and then reimported into Canada. This is true regardless of the origin of the goods and regardless of whether the goods could have been repaired or altered in Canada. Be aware, however, that Canada applies customs duties on the value of repairs or alterations whenever a charge is levied.
Where can I get detailed information?
To ensure a smooth entry into Canada with some type of temporary import, preparation is the key. The following web sites, produced by the Government of Canada, are excellent sources of information on this subject.
Temporary Importation (Tariff Item No. 9993.00.00) Regulations
Guide to Importing Commercial Goods
http://cbsa-asfc.gc.ca/import/menu-eng.html
Memorandum D17-1-5 "Importing Commercial Goods"
http://cbsa-asfc.gc.ca/publications/dm-md/d17/d17-1-5-eng.html
Canada Customs Act
http://www.cbsa-asfc.gc.ca/agency-agence/menu-eng.html
Individuals -- Bringing goods into Canada -- Temporary importations
List of FAQs related to Importing
http://www.cbsa-asfc.gc.ca/help-aide/faq-eng.html