Release Prior to Payment Changes: Seriously, You Should Register on the CCPCBSA aren’t kidding about getting importers to register on the CARM Client Portal. If you’ve been following the recent updates to the CARM implementation process, you’ll already be familiar with the coming changes to the Release Prior to Payment system. In a nutshell, CBSA allows importers to bring in goods before paying their duties and taxes as long as there is some kind of security posted. Up until now, importers have been able to use a bond posted by their customs broker as security. With the implementation of CARM Phase 2 in October of this year, that is going to change: importers will be required to post their own security in the form of a cash bond, a surety bond, or a one-time single entry bond. They will no longer be able to use their brokers’ security.
You may also have heard about the CARM Client Portal (CCP). The CCP is the online interface that allows importers to manage their shipments; essentially, a dashboard through which employees of an importer can delegate authority to customs brokers, pay bills, and monitor the status of their shipments. Eventually, all importers who bring goods into Canada will be required to be registered in the CCP, and the CBSA has been urging importers to get set up and comfortable with the portal well in advance of CARM Release 2.
CBSA are now offering a little bit more of a carrot, and a little bit more of a stick: importers who are registered in the CCP will get a six month grace period from the start of CARM Release 2 to get their security in place. Importers who are not registered in the CCP before October will have to have security in place immediately, with no grace period.
What this means in practical terms is that if you register on the CCP before October of this year, you can continue importing as usual without security until March 2024, by which time you will have to have your own security in place. That gives you six extra months to obtain your security. That additional six months may be crucial, particularly if you are planning to use a surety bond, because it’s likely that importers will not be able to obtain their bonds very far in advance. There are only a few surety companies in Canada, and many thousands of importers, so when CARM Release 2 hits in October there is likely to be a mad rush to obtain bonds. An extra six months to obtain your bond could be a massive boon.
If you aren’t registered on the CCP before October, you will have to provide your own security without a grace period. That means you will have to immediately obtain a surety bond or else post a cash or one-time bond, and you will not be able to continue importing until that security is in place.
So: Get registered on the CARM Client Portal before October!
It doesn’t take long, and we have a detailed guide available online. It may well save you months of headaches or, worst-case, losing your ability to import while your company obtains a bond.
Importers can also opt out of the Release Prior to Payment program entirely, but without RPP privileges duties and taxes need to be paid before your goods can cross the border into Canada. You can pay online through the CARM Client Portal or in person at a CBSA office. But since registering on the CCP will be a necessity for every importer at some point, we strongly recommend that importers register before this October to save themselves many potential headaches.
By Robin Smith, M.A., CCS. – Robin is a trade industry professional based in Victoria, BC.
CBSA aren’t kidding about getting importers to register on the CARM Client Portal. If you’ve been following the recent updates to the CARM implementation process, you’ll already be familiar with the coming changes to the Release Prior to Payment system. In a nutshell, CBSA allows importers to bring in goods before paying their duties and taxes as long as there is some kind of security posted. Up until now, importers have been able to use a bond posted by their customs broker as security. With the implementation of CARM Phase 2 in October of this year, that is going to change: importers will be required to post their own security in the form of a cash bond, a surety bond, or a one-time single entry bond. They will no longer be able to use their brokers’ security.
You may also have heard about the CARM Client Portal (CCP). The CCP is the online interface that allows importers to manage their shipments; essentially, a dashboard through which employees of an importer can delegate authority to customs brokers, pay bills, and monitor the status of their shipments. Eventually, all importers who bring goods into Canada will be required to be registered in the CCP, and the CBSA has been urging importers to get set up and comfortable with the portal well in advance of CARM Release 2.
CBSA are now offering a little bit more of a carrot, and a little bit more of a stick: importers who are registered in the CCP will get a six month grace period from the start of CARM Release 2 to get their security in place. Importers who are not registered in the CCP before October will have to have security in place immediately, with no grace period.
What this means in practical terms is that if you register on the CCP before October of this year, you can continue importing as usual without security until March 2024, by which time you will have to have your own security in place. That gives you six extra months to obtain your security. That additional six months may be crucial, particularly if you are planning to use a surety bond, because it’s likely that importers will not be able to obtain their bonds very far in advance. There are only a few surety companies in Canada, and many thousands of importers, so when CARM Release 2 hits in October there is likely to be a mad rush to obtain bonds. An extra six months to obtain your bond could be a massive boon.
If you aren’t registered on the CCP before October, you will have to provide your own security without a grace period. That means you will have to immediately obtain a surety bond or else post a cash or one-time bond, and you will not be able to continue importing until that security is in place.
So: Get registered on the CARM Client Portal before October!
It doesn’t take long, and we have a detailed guide available online. It may well save you months of headaches or, worst-case, losing your ability to import while your company obtains a bond.
Importers can also opt out of the Release Prior to Payment program entirely, but without RPP privileges duties and taxes need to be paid before your goods can cross the border into Canada. You can pay online through the CARM Client Portal or in person at a CBSA office. But since registering on the CCP will be a necessity for every importer at some point, we strongly recommend that importers register before this October to save themselves many potential headaches.
By Robin Smith, M.A., CCS. – Robin is a trade industry professional based in Victoria, BC.
