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Vol. 136, No. 15 — April 13, 2002
Designated Provisions (Customs) Regulations
Statutory Authority
Customs Act
Sponsoring Agency
Canada Customs and Revenue Agency
REGULATORY IMPACT ANALYSIS STATEMENT
Description
The Designated Provisions (Customs) Regulations (the Regulations) designate certain provisions of the Customs Act, Customs Tariff and Regulations made under those Acts that fall under the monetary penalty provisions of subsection 109.1(1) of the Customs Act (the Act), as amended. Any person failing to comply with a provision designated in the Regulations is liable to a penalty of not more than $25,000, as separately directed by the Minister of National Revenue under the legislation.
These Regulations bring into effect the major portion of the Administrative Monetary Penalty System (AMPS) initiative publicized by the Canada Customs and Revenue Agency (CCRA) under its 2000-2004 Customs Action Plan. They replace most of the former administrative penalty provisions of the Customs Act which were limited in scope and excluded important Customs program areas such as export reporting requirements. The new expanded administrative penalty system enables the CCRA to fulfil its objective of providing a fair and effective penalty structure in support of Canada's laws and regulations controlling the importation and exportation of goods.
In accordance with section 1 of the Regulations, the designated provisions are listed under column 1 of its two schedules. Schedule 1 designates 90 provisions under the Customs Act and seven subsidiary Regulations. Schedule 2 designates 25 provisions under the Customs Tariff and two subsidiary Regulations. Under section 2 of the Regulations, each designated provision is accompanied by a short-form description contained in column 2 of the schedules. This describes the contravention that occurs when a person fails to comply with the provision.
Penalty amounts assessed by Customs officials under the Minister's direction will reflect the CCRA's policy of using AMPS for corrective rather than punitive purposes. The severity and frequency of the infraction will be taken into account to ensure that repeat offenders incur higher-level penalties than first-time offenders. Administrative penalties have no effect on the manner in which the CCRA deals with persons who commit more serious offences under the Customs Act, for example, drug or weapons smugglers. These will continue to be dealt with under the more stringent penalty provisions of the Customs Act, for example, the seizure of goods or prosecution by the courts.
Alternatives
There is no practical alternative to this proposal. It replaces most of the former administrative penalty structure contained under the former sections 109.1 and 109.11 of the Customs Act which were of a limited scope.
The use of regulations to designate statutory and regulatory provisions subject to penalty for non-compliance will support the many national Customs programs in place. They provide a transparent listing of those contraventions that the CCRA considers serious enough to warrant a monetary penalty. In addition, any amendments contemplated by the CCRA to cover new initiatives will be made under the Federal Regulatory Policy which means that public input must be invited.
Benefits and Costs
Administrative penalties levied on the basis of the Designated Provisions (Customs) Regulations will in many instances replace the current goods seizure policy followed by customs officers. The payment of monetary penalties will expedite the release of goods. Seizures will be restricted to prohibited or controlled goods, or to situations where a monetary penalty is not an adequate deterrent. Every person assessed a monetary penalty has full recourse to the redress and appeal provisions of the Customs Act.
The primary objective of the AMPS initiative is to encourage compliance with the Act. A high percentage of persons involved in the importation and exportation of goods will comply with the provisions designated in these Regulations if they understand their purpose and appreciate the deterrent effect of a uniformly administered monetary penalty system. AMPS are presently used by other Customs administrations and other Canadian federal government departments.
AMPS allows for more strategic and proactive enforcement practices by Customs. The Regulations provide the CCRA with more flexibility to meet the requirements of a modern Customs compliance policy. Amendments can quickly be made to accommodate new program requirements with minimum resource and cost impact. AMPS will not inhibit the CCRA's ability to concentrate its resources on high-risk areas where a potential danger to Canadian society exists, for example, the illegal importation of narcotics, firearms and other controlled goods.
Consultation
The CCRA has consulted extensively with stakeholders since September 1999, to explain the AMPS initiative. These consultations were directed at the importing, exporting, transportation and brokerage communities. Contraventions and monetary penalties based on the provisions designated in these Regulations are provided in detail on the CCRA Web site in a "Master Penalty Document", which document was sent to various associations for comment. Personal presentations were made to all parties expressing interest. Their comments and suggestions were actively sought and taken into consideration.
Compliance and Enforcement
The CCRA will use its existing resources to enforce the Designated Provisions (Customs) Regulations in conjunction with the full AMPS Program. An automated penalty assessment system will enable Customs officials across all regions to issue formal penalty assessment notices according to national guidelines established by the CCRA. A Customs memorandum fully explaining the national policy adopted to administer this program will be available to the public together with an AMPS Reference Manual. The "Master Penalty Document" is also a comprehensive reference document.
A comprehensive training program has been developed to prepare Customs officials in all regions of the country for the implementation of AMPS.
Contact
Fred Light, Director, Customs Wide Sanctions Study, 171 Slater Street, Room 260, Ottawa, Ontario K1A 0L5, (613) 954-7130 (Telephone), (613) 952-5491 (Facsimile), Fred.Light@ccra.adrc. gc.ca (Electronic mail).
PROPOSED REGULATORY TEXT
Notice is hereby given that the Governor in Council, pursuant to subsection 109.1(3) (see footnote a) of the Customs Act (see footnote b) , proposes to make the annexed Designated Provisions (Customs) Regulations.
Interested persons may make representations with respect to the proposed Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to the Minister of National Revenue, Connaught Building, 7th Floor, 555 MacKenzie Avenue, Ottawa, Ontario, K1A 0L5.
Persons making representations should identify any of those representations the disclosure of which should be refused under the Access to Information Act, in particular under sections 19 and 20 of that Act, and should indicate the reasons why and the period during which the representations should not be disclosed. They should also identify any representations for which there is a consent to disclosure for the purposes of that Act.
Ottawa, April 11, 2002
EILEEN BOYD
Assistant Clerk of the Privy Council
[15-1-o]
DESIGNATED PROVISIONS (CUSTOMS) REGULATIONS
DESIGNATION OF PROVISIONS
1. A provision of the Customs Act or the Customs Tariff or a regulation made under any of those Acts that is set out in column 1 of Schedules 1 or 2 is designated for the purpose of subsection 109.1(1) of the Customs Act.
SHORT-FORM DESCRIPTIONS
2. (1) The short-form descriptions of a designated provision that is set out in column 1 of an item in Schedules 1 or 2 are the descriptions set out in column 2 of that item.
(2) Subject to subsection 109.3(4) of the Customs Act, the applicable short-form description of a designated provision shall be used on a notice of assessment referred to in subsection 109.3(1) of the Customs Act to describe a contravention of the provision.
COMING INTO FORCE
3. These Regulations come into force on the day on which they are registered.
SCHEDULE 1
(Section 1 and subsection 2(1))
DESIGNATED PROVISIONS OF THE CUSTOMS ACT AND ITS REGULATIONS
PART 1
CUSTOMS ACT
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
2(1.3) |
Failing to keep electronic records in an
electronically readable format for prescribed
period |
| 2. |
3.5 |
When making a payment in excess of a specified amount, failing to make the payment to the account
of the Receiver General in prescribed manner and
within prescribed time at a specified
institution |
| 3. |
7.1 |
Providing information to an officer that is not true, accurate and complete |
| 4. |
9(3) |
Failing to make available to an officer prescribed records within the specified time |
| 5. |
9(4) |
(a) Transacting or attempting to transact business as
a customs broker without a licence or without meeting specified requirements
(b) Holding oneself out as a customs broker
without a licence or without meeting specified requirements |
| 6. |
11(1) |
(a) Failing to enter Canada at an open customs office that is designated for that purpose
(b) Failing to present oneself to an officer without delay
(c) Failing to answer truthfully questions asked by an officer |
| 7. |
11(3) |
Failing to ensure that passengers and crew of conveyance arriving in Canada are forthwith transported to an open customs office that is designated for that purpose |
| 8. |
12 |
Failing to report imported goods at prescribed
time and in prescribed manner at the nearest
open customs office that is designated for that
purpose. |
| 9. |
13(a) |
Failing to answer truthfully questions asked by an officer with respect to goods |
| 10. |
13(b) |
Failing to present goods to an officer or make them available for examination by an officer in manner required |
| 11. |
14(2) |
Failing to report forthwith in prescribed manner
a conveyance, unloaded goods and any goods
remaining on the conveyance at a customs
office designated for that purpose |
| 12. |
15 |
(a) Failing to report forthwith to an officer goods in respect of which an Act of Parliament that prohibits, controls or regulates the importation of goods has been contravened
(b) Failing to report forthwith to an officer goods in respect of which duties have not been paid |
| 13. |
16(2)(a) |
Failing to report forthwith to an officer delivery of a wreck that has come into Canada |
| 14. |
19(1)(a) |
Delivering or causing to be delivered, without authorization, goods from a customs office to another customs office or sufferance warehouse |
| 15. |
19(1)(b) |
Delivering or causing to be delivered, without authorization, goods from one sufferance warehouse
to another |
| 16. |
19(1)(c) |
Removing or causing to be removed, without authorization, ships' stores from a customs
office or sufferance warehouse for use on board
a conveyance |
| 17. |
19(1)(d) |
Exporting or causing to be exported, without authorization, goods directly from a customs office
or sufferance warehouse |
| 18. |
19(1)(e) |
Leaving, without authorization, goods at a customs office |
| 19. |
19(1.1) |
Delivering or causing to be delivered, without authorization, goods to the place of business of the importer, owner or consignee |
| 20. |
20(1) |
Transporting or causing to be transported within
Canada imported goods that have not been released without complying with prescribed conditions or
giving prescribed security |
| 21. |
21 |
(a) Failing to afford an officer free access to specified premises or place
(b) Failing to open package or container or to remove any covering from it |
| 22. |
22(1) |
(a) Failing to keep prescribed records at specified
place for prescribed period and in prescribed
manner
(b) Failing to make prescribed records
available to an officer within the time
specified
(c) Failing to answer truthfully questions
asked by an officer about prescribed records |
| 23. |
25 |
Refusing to receive qualified goods at sufferance warehouse |
| 24. |
27 |
(a) Failing to afford an officer free access to
a sufferance warehouse, bonded warehouse or
duty free shop
(b) Failing to open package or container or to remove any covering from it |
| 25. |
31 |
Removing of goods from specified place that have
not been released by an officer or by prescribed
means |
| 26. |
32(3) |
Failing to account for released goods
in prescribed time and
manner |
| 27. |
32(5) |
(a) Failing to account for goods within
prescribed time and in prescribed
manner
(b) Failing to pay duties within prescribed
time |
| 28. |
32.2(1)(a) |
Failing to correct, within the 90-day period,
a declaration of origin of goods in
prescribed manner and form
containing prescribed
information |
| 29. |
32.2(1)(b) |
Failing to pay duties and interest owing as a result
of corrected declaration of origin of goods within
the 90-day period |
| 30. |
32.2(2)(a) |
Failing to correct specified declaration, within
the 90-day period, in prescribed form and
manner, with prescribed
information |
| 31. |
32.2(2)(b) |
Failing to pay duties and interest owing as a result
of corrected specified declaration within the
90-day period |
| 32. |
32.3(a) |
Failing to report to an officer, at the time of their diversion, the diversion of goods that were to be used
as ships' stores |
| 33. |
32.3(b) |
Failing to account for, at the time of their
diversion, goods that were to be used as
ships' stores in the prescribed manner and
form containing prescribed
information |
| 34. |
32.3(c) |
Failing to pay, at the time of their diversion, the specified amount of duties on goods that were to be
used as ships' stores |
| 35. |
33 |
Failing to pay duties within prescribed time
where goods are released prior to payment
of duties |
| 36. |
35.01 |
Importing goods not marked in accordance with the regulations under Customs Tariff |
| 37. |
35.1 |
Failing to furnish proof of origin of goods in prescribed form, containing prescribed information and containing or accompanied by the prescribed information, statements or proof |
| 38. |
40(1) |
(a) Failing to keep records at specified place
in prescribed manner and for prescribed
period
(b) Failing to make records available to an officer
within the time specified
(c) Failing to answer truthfully questions asked by
an officer in respect of records |
| 39. |
40(3) |
(a) Failing to keep prescribed records at specified
place in prescribed manner and for prescribed
period
(b) Failing to make prescribed records available to
an officer within the time specified
(c) Failing to answer truthfully questions asked by
an officer in respect of prescribed records |
| 40. |
43(2) |
Failing to comply with Minister's notice to provide documents |
| 41. |
80.2(2)(a) |
Failing to report to an officer a specified failure
within 90 days |
| 42. |
80.2(2)(b) |
Failing to repay excess amount of abatement
or refund granted and interest within the
90-day period |
| 43. |
95(1) |
Failing to report exported goods at prescribed time
and place and in prescribed manner. |
| 44. |
95(3)(a) |
Failing to answer truthfully questions asked by an officer with respect to exported goods |
| 45. |
95(3)(b) |
Failing to present goods to be exported to an officer
or make them available for examination by an officer
in manner required |
| 46. |
96 |
Failing to report forthwith to an officer goods that were not duly exported |
| 47. |
97.1(2) |
Failing to provide copy of certificate of origin of exported goods to an officer |
| 48. |
97.1(3) |
Failing to immediately notify a person of correct information in respect of a certificate of origin of exported goods |
| 49. |
97.2(1) |
(a) Failing to keep records at specified place in prescribed manner and for prescribed period
(b) Failing to make records available to an officer
within the time specified
(c) Failing to answer truthfully questions asked by an officer in respect of records |
| 50. |
107.1 |
Failing to provide, or provide access to, prescribed information about
any person on board a conveyance in advance of, or within a reasonable
time after, the arrival of the conveyance in Canada |
PART 2
ACCOUNTING FOR IMPORTED GOODS AND PAYMENT OF DUTIES REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
4 |
Failing to provide at specified time every document and any information required to be provided under an Act of Parliament or its regulations that prohibits, controls or regulates the importation of goods. |
PART 3
CUSTOMS BROKERS LICENSING REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
14(b)(i) |
Failing to immediately notify chief officer of customs
in writing of a change in the address of a business
office at which broker transacts business |
| 2. |
14(b)(ii) |
Failing to immediately notify chief officer of
customs in writing of a change in the legal
or business name of the partnership or
corporation |
| 3. |
14(b)(iii) |
Failing to immediately notify chief officer of
customs in writing of a change in the membership
of the partnership |
| 4. |
14(b)(iv) |
Failing to immediately notify chief officer of customs
in writing of a change in the officers or directors of the corporation |
| 5. |
14(b)(vi) |
Failing to immediately notify chief officer of customs
in writing of a change in the ownership of the business or corporation |
| 6. |
14(b)(vii) |
Failing to immediately notify chief officer of customs
in writing of a change in the individuals meeting the specified knowledge requirement who are employed
full time |
| 7. |
14(c) |
(a) Failing to furnish to the importer or exporter
of goods a copy of customs accounting documents bearing the customs accounting number and official stamp
(b) Failing to furnish to the importer or exporter of goods a copy of information transmitted by electronic means to the Agency |
| 8. |
14(d)(i) |
Failing to promptly account to a client importer or exporter for funds received from the Receiver General for Canada |
| 9. |
14(d)(ii) |
Failing to promptly account to a client importer
or exporter for funds received in excess of
duties or other charges payable to the
Agency |
| 10. |
17(1)(a) |
Failing to keep records and books of account
indicating specified financial
transactionS |
| 11. |
17(1)(b) |
(a) Failing to keep a copy of each specified customs accounting document and copies of all supporting documents
(b) Failing to keep a copy of specified information transmitted by electronic means to the
Agency |
| 12. |
17(1)(c) |
Failing to keep copies of all specified correspondence, bills, accounts, statements and other papers |
| 13. |
17(1)(d) |
Failing to keep separately specified records, books
of account and other documents relating to
business transacted at a specified customs
office |
PART 4
CUSTOMS SUFFERANCE WAREHOUSES REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
11(1)(e) |
Failing to provide facilities, equipment
and personnel sufficient to control access
to a sufferance warehouse and to ensure
the secure storage of goods
stored in it |
| 2. |
12(1)
|
Failing to ensure goods are stored
safely and securely in a
designated area |
| 3. |
12(2) |
Entering place in sufferance warehouse where goods are stored without written authorization or attendance of an officer |
| 4. |
12(3)(a) |
Failing to have procedures to maintain the security of, and restrict access to, the sufferance warehouse |
| 5. |
12(3)(b) |
Failing to have procedures to ensure that personnel are aware of and follow procedures to maintain the security of, and restrict access to, the sufferance warehouse |
| 6. |
14 |
Failing to acknowledge receipt of goods in prescribed manner |
| 7. |
15(5) |
Failing to provide the Agency with list of all goods not removed from the sufferance warehouse within prescribed time |
| 8. |
17 |
Manipulating, unpacking, packing, altering or combining goods for a purpose that is not specified |
PART 5
DUTY FREE SHOP REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
14(a) |
Failing to ensure that goods received in a
duty free shop are stored and
marked in prescribed
manner |
| 2. |
14(b) |
(a) Failing to ensure that
imported goods received in a
duty free shop are held in a designated
area until accounted for |
| |
|
(b) Failing to ensure that
domestic goods received in a
duty free shop are held in designated
area until approved for entry into
inventory |
| 3. |
14(c) |
Failing to ensure that
duty free shop may be locked and
sealed by an officer, on request of chief
officer of customs |
| 4. |
14(d) |
Failing to ensure that duty free shop
may be locked and sealed during the
prescribed period by an officer in event
that licensee's licence expires or is cancelled
or suspended |
| 5. |
14(e) |
Failing to ensure that duty free shop
is kept suitable for the
safekeeping of goods
stored in it |
| 6. |
16(1)(a) |
Failing to acknowledge receipt of goods in prescribed manner |
| 7. |
16(1)(b)
|
Failing to immediately notify chief officer of customs of the receipt of goods |
| 8. |
16(2)
|
Failing to present required documents to chief officer of customs before goods are taken into a duty free shop |
| 9. |
17(a) |
Failing to provide to chief officer of
customs a summary of monthly sales and remittance of fees in prescribed form within
the specified period |
| 10. |
17(b) |
Failing to provide to chief officer of customs an annual report in prescribed form within the specified period |
| 11. |
19 |
Selling or otherwise conveying any tobacco product to a person under the age of 18 |
PART 6
PERSONS AUTHORIZED TO ACCOUNT FOR CASUAL GOODS REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
10(a) |
Failing to notify Minister or designated officer in writing of change of address within two weeks of change |
| 2. |
10(b) |
Failing to notify Minister or designated
officer in writing of change in name
within two weeks of
change |
| 3. |
10(c) |
Failing to notify Minister or
designated officer in writing of change in ownership of business within
two weeks of change |
PART 7
REPORTING OF EXPORTED GOODS REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
5 |
Failing to provide to chief officer of
customs, on or before the day of
exportation, any information and
all documents required under an Act
of Parliament or its regulations that
prohibit, control or regulate the exportation
of goods |
PART 8
TRANSPORTATION OF GOODS REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
4(1)(a) |
Failing to forthwith report a damaged or broken seal |
| 2. |
4(1)(b) |
Failing to forthwith report removal of goods from a damaged or disabled container or conveyance |
| 3. |
4(1)(c) |
Failing to forthwith report a
damaged or disabled conveyance
that can no longer be used to
transport goods |
SCHEDULE 2
(Section 1 and subsection 2(1))
DESIGNATED PROVISIONS OF THE CUSTOMS TARIFF AND ITS REGULATIONS
PART 1
CUSTOMS TARIFF
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
114(1) |
Failing to pay excess amount of refund or drawback and interest on day it
is received |
| 2. |
118(1)(a) |
Failing to report to an officer, within required period, non-compliance with conditions of relief or remission granted |
| 3. |
118(1)(b) |
Failing to pay, within required period, amount of duties in respect of relief or remission granted |
| 4. |
118(2)(a) |
Failing to report diversion of
goods to an officer within
90 days |
| 5. |
118(2)(b) |
Failing to pay amount of drawback
and interest within 90 days |
| 6. |
121(1) |
Failing to pay amount owing
within 90 days after production of
a by-product |
| 7. |
122(1) |
Failing to pay amount owing
within 90 days after production of merchantable scrap or
waste |
PART 2
CUSTOMS BONDED WAREHOUSES REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
11(1)(a) |
Failing to provide at a bonded
warehouse facilities, equipment
and personnel sufficient to control
access and to secure storage of
goods |
| 2. |
11(1)(b) |
Failing to provide at a bonded warehouse adequate space for the examination of
goods by officers |
| 3. |
11(1)(c) |
Failing to provide at a bonded warehouse necessary personnel and equipment
to make goods available to
an officer |
| 4. |
11(1)(d) |
Failing to provide at a bonded warehouse necessary personnel to furnish information
for audit purposes |
| 5. |
11(2) |
Failing to keep bonded warehouse separate from remainder of building on request of chief officer of customs |
| 6. |
12(1)(a) |
Failing to ensure that goods
received in a bonded warehouse
are stored safely and securely in
a designated area |
| 7. |
12(1)(b) |
Failing to ensure that goods received in a bonded warehouse are identified in specified manner |
| 8. |
12(2) |
Entering a place where goods
are stored in a bonded warehouse without written authorization or attendance of an officer |
| 9. |
13 |
Receiving in or transferring from a bonded warehouse intoxicating liquor without provincial approval |
| 10. |
14 |
Unlawfully receiving imported tobacco products into a bonded warehouse |
| 11. |
15 |
Unlawfully removing imported tobacco products from a bonded warehouse |
| 12. |
16(1) |
Receiving into a bonded warehouse
domestic tobacco products that are
not to be removed for use as ships'
stores |
| 13. |
16(2) |
Removing from a bonded warehouse
domestic tobacco products that are
not being removed for use as ships'
stores |
| 14. |
17(a) |
Failing to acknowledge in
prescribed manner receipt of
imported goods into a bonded
warehouse |
| 15. |
17(b) |
Failing to acknowledge in
prescribed manner receipt of
goods, other than imported goods,
in a bonded warehouse |
| 16. |
20 |
Manipulating, altering or combining
goods for a purpose or activity
not specified |
PART 3
SHIPS' STORES REGULATIONS
Item |
Column 1
Designated Provision |
Column 2
Short-form Description |
| 1. |
4 |
Failing to place alcohol, tobacco and
other goods for sale on board a ship
under lock or seal when ship
arrives at Canadian port and
failing to keep them there while
ship is in port |
| 2. |
5(1) |
Failing to ensure that bar-boxes on board an international aircraft are sealed when aircraft is on the ground |
[15-1-o]
Footnote a
S.C. 2001, c. 25, s. 62
Footnote b
R.S., c. 1 (2nd Supp.)
|
