To import products into Canada, you need to understand the regulations and requirements of the Canada Border Services Agency (CBSA) and determine whether an import permit is required based on the product type.
Steps to obtain an import license
Step 1: Register Your Business and Get a Business Number
Before importing goods into Canada, you must register your business with the Canada Revenue Agency (CRA) to obtain a Business Number (BN). As part of this process, you’ll also receive an import/export account number ending in “RM,” which is required for all import-related transactions. Beginning May 13, 2024, the Canada Border Services Agency (CBSA) will fully implement the CBSA Assessment and Revenue Management (CARM) program. Under this new system, all importers must register their businesses through the CARM Client Portal. During registration, you must provide key details such as your business’s legal name, physical address, contact information, and business structure. In certain cases, you may also be required to provide a customs bond as a financial guarantee to ensure your compliance with duties and tax obligations.
Step 2: Identify Your Product (HS Code)
The next step in the import process is to accurately classify your product using the Harmonized System (HS) code. This internationally standardized coding system is essential because it determines the applicable tariffs, whether an import license is required, and any other regulatory requirements. You can use the Canadian Customs Tariff or trusted HS code lookup tools such as the Global Trade Data Platform to find the correct HS code for your product. If your product is complex or you’re unsure about the proper classification, it’s a good idea to consult a licensed customs broker. Be sure to provide a detailed and accurate product description—clear descriptions help ensure the correct classification and reduce the risk of delays or compliance issues.
Step 3: Determine Licensing Requirements
Once you’ve identified the correct HS code for your product, the next step is to determine whether the item is considered a controlled good under Canada’s Import Control List (ICL), as outlined in the Export and Import Permits Act. To do this, visit the Global Affairs Canada website to access the most up-to-date version of the ICL. If your product is listed, you must identify which government agency is responsible for issuing the required import permit. For example, Global Affairs Canada oversees permits for items like agricultural products, textiles, steel, and strategic goods; the Canadian Food Inspection Agency (CFIA) handles licenses for food, plant and animal products, seeds, fertilizers, and related items; Natural Resources Canada manages imports involving explosives and nuclear materials; and the Royal Canadian Mounted Police (RCMP) regulates the import of firearms and ammunition. Once the appropriate agency is identified, it’s essential to thoroughly review the specific permit requirements, conditions, and any applicable restrictions to ensure full compliance.
Step 4: Apply for an Import License
Once you’ve confirmed that your product requires a license and clearly understand the specific requirements, the next step is formally applying through the appropriate government agency. Start by obtaining the correct application form—these can typically be downloaded directly from the official website of the department responsible for regulating your product. When completing the form, provide accurate and complete information, including your company details, product description, country of origin, quantity, value, and intended use. It’s important to be thorough, as any missing or incorrect information could delay approval. You’ll also need to prepare all required support documents by both the application form instructions and the department’s specific guidelines (see Step 5 for details on documentation).
Step 5: Understand Document Requirements
To successfully apply for an import license and ensure smooth customs clearance, it’s essential to gather all required documentation in advance. The specific documents you’ll need may vary depending on the type of product you’re importing, but several are commonly required across most categories. These include:
- Commercial Invoice: Provides key details about the goods, including their value, quantity, description, and country of origin.
- Packing List: Provides packaging details, including the weight, dimensions, and content breakdown of each shipment unit.
- Bill of Lading or Air Waybill: Serves as both the contract of carriage and the receipt for the transported goods.
- Certificate of Origin: Confirms where the goods were manufactured, which can influence tariff rates under various trade agreements.
- Product Test Report or Analysis Certificate: Required for certain regulated items such as food, pharmaceuticals, or chemicals to demonstrate compliance with Canadian safety and quality standards.
- Plant Quarantine Certificate or Veterinary Health Certificate: Needed for the import of animal or plant-based products to confirm they meet Canadian health regulations.
- Trade Contract or Purchase Order: Verifies the terms of the transaction between buyer and seller.
Additional documentation may be required for specific industries or product types; therefore, it’s essential to verify the exact requirements with the relevant government agency or consult a licensed customs broker.
Step 6: Submit the Required Documents and Fees
Once you’ve completed the application form and gathered all necessary supporting documents, submit your application to the appropriate government agency. Depending on the agency’s procedures, you can submit your application online, by mail, or in person. Most import license applications require a fee, so be sure to follow the payment instructions provided by the issuing department. The fee amount can vary based on the type of license and the responsible agency. After submitting your application, make a note of your application number and monitor the status regularly, as processing times may vary depending on the complexity of your application and the department’s current workload.
Step 7: Receive and Review the Import License
Once your application has been approved, you will receive your official import license. It’s important to carefully review the license upon receipt to ensure that all information is accurate and aligns with your import plan. Pay close attention to key details such as the validity period, the specific goods authorized for import, the approved quantity, and any conditions or restrictions listed. If you notice any discrepancies, contact the issuing agency immediately for clarification or correction. Be sure to store the license in a secure place, as you may need to present it during customs clearance or for future compliance checks.
Step 8: Update and Maintain Your Import License
To ensure continued compliance, it’s essential to keep your import license up to date and valid. Start by monitoring the license’s expiration date and apply for renewal well in advance if needed to avoid any disruption to your import activities. Be sure to follow all conditions and restrictions outlined in the license strictly. If there are any significant changes to your business—such as updates to company information, product categories, or import volumes—promptly contact the issuing authority to determine whether your license requires modification. Additionally, maintain organized records of your license and all related documentation for future audits or regulatory reviews.
What Are the Regulations and Requirements for Importing Products into Canada?
When importing goods into Canada, importers must comply with a range of regulatory and documentation requirements to ensure smooth customs clearance and avoid penalties. Below is an overview of the key obligations:
1. Business Number (BN)
All importers are required to register for a Business Number (BN) with the Canada Border Services Agency (CBSA). This number is essential for all import-related activities.
2. Documentation Requirements
Importers must prepare and submit accurate customs documentation, including:
- Commercial Invoice: Must include the value, quantity, detailed product descriptions, country of origin, and the names of both the buyer and seller.
- Packing List: Outlines the contents of each package, including quantities and packaging details.
- Bill of Lading / Air Waybill: Serves as the contract of carriage and receipt for the goods.
- Certificate of Origin: Confirms the country where the goods were manufactured, which may impact applicable tariffs.
- Import Permit or Other Licenses: Required for specific regulated goods (as discussed in earlier steps).
- HS Code (Harmonized System Code): Used to classify products internationally and determine the correct tariff rates and import requirements.
3. Customs Compliance
- Valuation: The declared value of imported goods must reflect the actual price paid or payable, including commissions, brokerage fees, packaging costs, royalties, and freight charges up to the Canadian port of entry. Understating the value is illegal and can result in heavy penalties.
- Tariffs and Taxes: Importers must pay applicable duties and taxes, including the Goods and Services Tax (GST) (5%) and, where appropriate, Harmonized Sales Tax (HST) or Provincial Sales Tax (PST). Tariff rates vary by product type—clothing often carries higher tariffs, while many electronics may be duty-free.
- De Minimis Thresholds: Canada applies minimum value thresholds for exemptions. For goods imported from the U.S. or Mexico, if the combined value and duties are under CAD 40, both duties and taxes may be waived. If the FOB (Free on Board) value is under CAD 150, duties may be exempt, though taxes could still apply. For postal shipments, a CAD 20 duty-free allowance is standard.
4. Product Standards and Labeling
Imported goods must comply with Canadian safety and labeling standards. For example, food items must meet strict guidelines enforced by the Canadian Food Inspection Agency (CFIA), including regulations that ensure traceability and safety.
5. Restricted or Prohibited Items
Certain goods are restricted or banned from import into Canada. These include explosive or flammable substances, some types of batteries, firearms, and other weapons. It’s essential to verify whether your product falls under any of these categories before attempting to import.
Import License Fees
Under the Export and Import Permits and Certificates Fees Order, import license fees are based on the total value of the goods being imported. The fee structure is as follows:
- Goods valued under CAD 1,000: CAD 15
- CAD 1,000 to CAD 4,999: CAD 19
- CAD 5,000 to CAD 9,999: CAD 23
- CAD 10,000 to CAD 19,999: CAD 27
- CAD 20,000 and above: CAD 31
Please note that these fees apply specifically to licenses issued by the Canadian Export and Import Controls Bureau (EICB).
Steps to Importing Into Canada
Now that you know how to get an import license in Canada, you can start the importing process. Follow these steps.
Determine If the Goods Can Be Imported To Canada
Before contacting the seller to purchase the goods, you should first verify if they are on the list of items that can be imported to Canada. Then, please familiarize yourself with everything you want to transport, including its country of origin and the manufacturer.
You should also check if the goods are on the list of controlled, regulated, or prohibited items according to Other Government Departments (OGDs). The regulated goods require specific permits and certificates that must be submitted to import them.
Determine the Duties and Taxes
If the items are allowed into Canada, the next important step is to find the Tariff classification and duty rate. You should also determine the taxes payable when importing your items to Canada. The tariff classification is represented by a code that identifies the item and its corresponding duty rate.
Register the Business for Import or Export
You cannot import items into Canada without an import/export license. There are steps to getting the permit, and you can also use a customs broker. You will have a Business Number, a business name, and a GST/HST account by completing the steps.
Determine Methods You Will Use to Submit Your Entry Declaration to Customs
Business owners can choose a method of submitting their entry declaration from a list of options. For example, you can use a courier or freight forwarder to offer them on your behalf or hire a customs broker.
Custom brokers receive the shipment and verify that the presented documents are complete and comply with customs regulations. Therefore, they are more efficient, and you will get fewer risks associated with cross-border trades.
Prepare To Pay Duties and Taxes
You can pay your duties and taxes yourself or hire a licensed customs broker to handle the process, but they charge a service fee. Notably, many rules and regulations guide importers on how to pay duties and taxes.
Direct Security
The old businesses used the direct security method of tax payment. The company pays customs on the last business day; penalties apply if payment is made after the due date.
Goods and Services Tax Direct
You must register to use the GST directly. The business also pays its customs on the last day of the month, but you don’t have to post your bond and obtain your security. You will also be charged a penalty for late payment.
Customs Broker’s Bond
You can also use the customs broker’s bond to pay your taxes. However, customs brokers charge a fee and may ask for a deposit upfront. Hire a licensed customs broker and obtain the requirements from them.
Plan To Ship Your Items
Once you have identified that the items are importable into Canada and have the necessary documents, prepare to get your goods. You can do this yourself or hire a freight forwarder to handle your importation.
Freight forwarders handle all transportation processes. They will also make your work easier if you need to use multiple carriers and choose the best mode of transportation. Alternatively, use a carrier directly if you have only one mode of shipment.
Ensure you select the most suitable mode for transporting your items. The options to choose from are marine, rail, highway, air, or through the post office. You can also select courier services.
Get a Representative to Monitor the Customs Activity
Checking the customs progress can be tiring, and sometimes you might forget, especially if you are too busy. Therefore, you should get a company representative to monitor the Customs activities.
They will be aware of the movements of your goods and updated on any changes in customs regulations. To comply with Customs rules, you should also ensure you have the required internal procedures, documents, valuations, and origins.
Final Words
Knowing how to get an import license in Canada is crucial to starting your importation business. To avoid losses, you should also identify the items that can be brought into the country, those with restrictions, and the illegal items before making a purchase.
In summary, the efficient management of Canada import and export operations necessitates a comprehensive understanding of customs regulations, tariff classifications, and various trade agreements. For any enterprise engaged in shipping goods from China to Canada, possessing the appropriate documentation and adhering to Canadian and international regulations are of paramount importance. Conversely, by selecting the most appropriate mode of transportation, combining it with the most suitable international trade terms, and potentially leveraging free trade agreements, businesses can streamline operations and mitigate risks. In the context of Canada’s highly competitive import/export sector, meticulous planning and adherence to guidelines are imperative for optimizing trade activities and ensuring seamless transactions, whether individuals undertake the process independently or in collaboration with a broker.
