Regulatory Compliance updates April 2023

The CBSA is resuming regular hours of service at 42 ports of entry across Canada

The Canada Border Services Agency (CBSA) is reinstating pre-pandemic operational hours of service at 39 land and three air ports of entry (POE). This includes the seasonal re-opening of the Chief Mountain POE and the re-opening of the Bloomfield POE following infrastructure work. This announcement will help facilitate travel across Canada at land and air ports of entry. Impacted POEs by province: 

• Alberta: 4 land POEs and 1 airport
• British Columbia: 3 land POEs
• Manitoba: 13 land POEs and 1 airport
• New Brunswick: 3 land POEs
• Quebec:7 land POEs
• Saskatchewan: 9 land POEs and 1 airport

Canada: Adjusted Rates of Excise Duty on Spirits and Wine Effective April 1, 2023

On March 28, 2023, the Minister of Finance tabled Budget 2023, which included a proposed amendment to the Excise Act, 2001. Consequently, the annual adjustment to the rates of excise duty on spirits and wine, which is usually based on changes to the Consumer Price Index, would instead be based on a lower rate.

As a result, the proposed adjusted rates of excise duty on spirits and wine effective April 1, 2023, are:

• $0.337 per litre of spirits, for spirits containing not more than 7% absolute ethyl alcohol by volume
• $13.303 per litre of absolute ethyl alcohol, for spirits containing more than 7% absolute ethyl alcohol by volume
• $0.022 per litre of wine, for wine containing not more than 1.2% absolute ethyl alcohol by volume
• $0.337 per litre of wine, for wine containing more than 1.2% but not more than 7% absolute ethyl alcohol by volume
• $0.702 per litre of wine, for wine containing more than 7% absolute ethyl alcohol by volume

Effective April 1, 2023, the Canada Revenue Agency will allow licensees to report and remit excise duty on spirits and wine at the lower rates. However, licensees that choose to pay the duty in accordance with the proposed new rates as of this date will be required to pay the difference in applicable duty should the enabling legislation not be enacted by Parliament.

China launches probe on Taiwan import barriers on 2,455 products

China has launched an investigation into Taiwan’s import restrictions on a total of 2,455 products from the mainland, including chemicals and textiles. The “trade barrier investigation” was launched on 12 April and will initially last six months, in response to a petition by three China-based trade groups into these trade barriers imposed by Taiwan, according to China’s Ministry of Commerce (MOC). The probe on what it calls as “Taiwan’s trade restrictive measures against the mainland” could be extended by another three months to 12 January 2024 if “exceptional circumstances arise”, the ministry said.

The China Chamber of Commerce for the Import and Export of Textiles, the China Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters and the China Chamber of Commerce of the Import & Export of Foodstuffs have requested the probe. 

China customs repealed and launched several administrative regulations (Decree of the General Administration of Customs of the People's Republic of China No.261/Customs Announcement No. 20 [2023])

On March 7,2023, China customs issued on the abolition of the three rules, including the ”Measures of the Customs of the People's Republic of China for export processing zone goods out of the area for carry-forward processing ", "Measures for the Examination and Approval of the Customs of the People's Republic of China on Examination and Administration of Free Gifts by Foreign Governments and International Organizations and China's Implementation of Tax Reduction or Exemption of Import Materials stipulated in International treaties "and" Measures for Supervision and Administration of Inspection and Quarantine of Solid Waste that Can be used as Raw Materials ", effective from March 7,2023.

On March 8, 2023, China Customs issued the announcement on the examination and confirmation of foreign governments and international organizations and China's implementation of the examination and confirmation of tax reduction and exemption of imported materials stipulated in international treaties, which clarified the scope and policies of tax reduction and exemption, application materials and procedures for tax reduction and exemption of free imported materials, effective immediately.

EU and Timor-Leste sign deal on WTO accession

Timor-Leste took a major step closer to WTO accession. The EU and Timor-Leste signed a deal concluding their bilateral market access negotiations on services and goods as part of Timor-Leste’s accession process to the World Trade Organization. The EU is a major supporter of Timor-Leste’s accession to the World Trade Organization (WTO), which is expected to make a lasting contribution to Timor-Leste’s economic reform and sustainable development. For the EU, the WTO remains at the heart of the multilateral trading system that underpins open and fair trade, and its expansion is to the benefit of all members.

As part of the accession process, WTO accession candidates need to sign bilateral deals with interested WTO members that include both agriculture and tariffs on non-agricultural products, and also cover several service sectors. The commitments undertaken in these bilateral deals will apply to all WTO Members once the candidate’s accession is final.

The bilateral EU-Timor-Leste deal provides for lower tariffs for goods and for opening up services markets once Timor-Leste joins the WTO. These commitments will then be embodied in the future Protocol of Accession of Timor-Leste to the WTO. The European Union also recently signed an agreement with the government in Timor-Leste to support the country in the WTO, ASEAN and Pacific interim EPA accession negotiations. This action under the 11th European Development Fund (period 2014 – 2020) will benefit Timor-Leste in the next three years.

India to continue/provide health cess exemption on import of goods for use in the manufacture of X-ray machines

India customs authority has amended notification 8/2020-Customs, dated 02.02.2020 to continue/provide health cess exemption on import of goods for use in the manufacture of X-ray machines. The following goods for use in the manufacture of X-ray machines (heading 9022 14 20 or 9022 14 90), namely:-(a)Static User Interface (9018 90 99);(b)X-Ray Diagnostic Table (9022 90 40);(c)Vertical Bucky (9022 90 90);(d)X-Ray Tube Suspension (9022 90 90);(e)High Frequency X-Ray Generator (>25KHz, <500 mA) (9022 14 10);(f)X-Ray Grid (9022 90 90);(g)Multi Leaf Collimator/ Iris (9022 29 00 or 9022 90 90)(h)Medical Grade Monitor (8528 59 00);(i)Flat Panel Detector, including Scintillators (9022 90 90);(j)X-ray Tube (9022 30 00).

OECD members agree to EU initiative to modernise export credits

On 31 March, OECD countries reached an agreement in principle on an EU initiative to modernise export credit rules to better support the green transition. The deal to update the Arrangement on Officially Supported Export Credits will provide streamlined terms and conditions so that government-backed export finance can better meet the needs of exporters in an increasingly competitive landscape, while avoiding market distortions. At the same time, the outcome widens the scope of green and climate-friendly transactions benefitting from extra incentives in the form of more flexible financial terms and conditions.

The agreement foresees an expansion of the scope of green or climate-friendly projects eligible for longer repayment terms (i.e. eligible under the 'Climate Change Sector Understanding' or CCSU). These would include projects related to environmentally sustainable energy production; CO2 capture, storage, and transportation; transmission, distribution and storage of energy; clean hydrogen and ammonia; low emissions manufacturing; zero and low-emission transport; and clean energy minerals and ores.

United States Government Delays New Importer Rules For Russian Metals

On March 30, CBP announced it will delay implementation of new requirements for reporting the countries of smelt and cast for imports of aluminum and aluminum derivative products to allow additional time to update their software programming and systems to comply with the new reporting requirements.

The requirements had been set to take effect on April 10, 2023. They will now be implemented a month later, on May 10, 2023. The CBP said there is no change to the April 10, 2023 effective date of the 200 percent duties on imports of aluminum and derivative aluminum articles that are products of Russia or products “where any amount of primary aluminum used in the manufacture of such aluminum articles is smelted in Russia, or where such aluminum articles are cast in Russia.”

United States CBP Updates Operational Hours at North Troy and West Berkshire Ports of Entry

U.S. Customs and Border Protection (CBP) announced that it would update hours of operations at two ports of entry (POE) in Vermont, North Troy and West Berkshire. Both POEs will open at 8:00 am on April 15, 2023, and will then operate 24 hours, 7 days a week, aligning with adjacent Canada Border Services Agency ports. For several years, CBP has documented a reduction in privately-owned vehicle and pedestrian traffic at some POEs along its northern border. As part of CBP’s obligation to use its resources responsibly, it regularly evaluates workload, staffing, operating costs, and traffic volumes to align operating hours that reflect traffic patterns and place employees where they can be most useful.

CBP is sensitive to the concerns raised by local communities regarding reduced hours of operation. It is working closely with its partners to discuss the operational details surrounding changes to port hours and is in close coordination with local governmental officials and congressional stakeholders. CBP continues to work with CBSA to address shared concerns along the northern border and will continue to evaluate traffic volumes and other relevant data points when making decisions related to hours of operation and staffing. These efforts enable CBP to better align staffing during peak hours, allowing CBP to better serve the public and complete its border security mission.