Crossing borders: Mastering Canada's import portal (CARM) and Québec's french mandate

SHANNEN BORNSEN: OK, everyone. We want to welcome you this afternoon to our webinar. I'm Shannen Bornsen. I'm the current Chair of the Minnesota District Export Council. And I want to welcome you to our event this afternoon, our webinar Crossing Borders, Mastering Canada's Import Portal and Quebec's French Mandate.

And the Minnesota District Export Council is a non-profit organization. And our members are appointed by the US Department of Commerce. And we're here to assist small and medium-sized businesses either establish or grow their exports. And we do that through educational events such as this one, counseling one-on-one with businesses, and also legislative education and outreach. And you can learn more about our organization at exportassistance.com.

But today I'm excited to bring this webinar to you with our participating partner, Gowling WLG. And I'm going to turn the presentation over to Laura to introduce their firm and to kick us off. Thanks again for joining us.

LAURA GHEORGHIU: Thank you so much, Shannen. And thank you for having us here today. We're really thrilled to be with you. I just wanted to say a few quick words about Gowling and introduce our speakers. Gowling is an international law firm assisting clients in key global sectors, including food and beverage, real estate, banking and finance, technology, manufacturing and infrastructure.

We are home to one of the world's premier intellectual property practices and offer full suites of business law and dispute resolution services. We've got offices across Canada in seven different cities. We work in French and English. And we are really experienced working primarily with US clients and those that are looking to expand to the Canadian market. We're also joined-- if you ever wonder what WLG stands for, that is our colleagues around the world. We are 1,500 in Canada and another-- sorry, 800 Canada and another 800 across the globe.

And a little bit about myself. I'm a partner specializing in crossborder taxation and especially expansions into Canada. And I work a lot with either Greenfield expansions or M&A acquisitions. I'm also part of the Gowling team that works on assisting US corporations that are looking at Canada. And just a little preview, we are working with DC, Minnesota to prepare a tax center discussion of exporting to Canada in the next few months.

I want to take a minute to introduce our speakers. We have Hunter Fox, who is a senior associate in our auto office. His practice focuses on international trade, as well as privacy and access to information. And in his international trade practice, Hunter assists clients on a range of issues, including customs compliance and the use and interpretation of free trade and investment agreements.

Also joining us is Julia Kappler. She's a partner in our Montreal office and a member of the firm's advertising, marketing, and product regulatory law group. She assists clients in a range of commercial issues, including French language requirements, product packaging and labeling issues, e-commerce, and consumer protection matters, and promotion, design and review. Now, without further ado, I'm going to pass it to Julia who is going to start our presentation today.

JULIA KAPPLER: Thank you, Laura. Hi, everyone. As Laura said, to echo her words, pleasure to be here with you today. I'm glad to have you here with us. So to give you a little bit of background before we jump right into it. As any of you who regularly do business North of the border may already be aware, Quebec is often referred to as the California of Canada.

And that is unfortunately not because we share their wonderful weather, which we absolutely do not, but rather because it's often seen as the jurisdiction with the most onerous requirements and that makes businesses jump through the most hoops to operate here.

And while to some extent it is true that we do have some rules in Quebec that don't apply elsewhere in the country, the Quebec Requirements are often not quite as burdensome as they may seem at first glance. And so the Quebec-specific requirements that we're going to walk through today are Quebec's French language rules. So if we could advance two slides, please. Thank you.

So Quebec being the, I guess, sole French-- or one of the primary French-speaking areas in a vastly English-speaking North America, the province has adopted quite a bit or has taken many measures to protect the French language.

And so the primary piece of legislation through which the government does that is a law called the Charter of the French language. And this is nothing new. It was first passed in the '70s. But it has been making waves lately. And I think has even made headlines even past Quebec and Canada under the recent modifications brought by Bill 96, which the provincial government adopted in 2022 and has significantly strengthened a lot of the French language requirements.

So to give you a 10,000-foot overview, this law establishes French as the official language of commerce and business in the province of Quebec. And then imposes specific requirements on businesses as a result of this. So if we could move to the next slide, please.

So for the purposes of our discussion today, there are really two questions that are relevant. One is, does the charter apply to my business? Do I have to follow these rules? And two, if yes, what are these rules? What do I actually have to do? So next slide, please.

We're going to flip this around here and start with question two for reasons that will hopefully become evident in a few minutes. So in terms of what does the charter actually require. The charter creates specific rules that apply in various sectors of activity. And I just want to preface this with my standard lawyer disclaimer of this is just a general, high level overview of some of the rules. There are additional specific requirements that could apply in weird cases. There are weird exceptions to these rules, exceptions to these exceptions. So of course, this is just to give you a general overview of some of the requirements that could apply.

So the first category or bucket of rules under the charter is product packaging and labeling. So here, this requires that any product sold in Quebec be labeled in French. If you want to label it in French and another language, such as English, which is typically the case, that's absolutely fine as long as the French text is equally prominent on the package as compared to the English.

That essentially means that everything on your product packaging, on your label, on any documentation provided with a product, so that would be anything from instructions for use, warranty certificates, anything like that, all must be in French. If you're using French and one or any other languages, that's fine. The French, however, has to be-- everything has to be translated. And the French has to be just as large, just as noticeable.

So for example, on a product package, you can't have your English text in big, bright, colorful letters, very noticeable and the French in teeny-tiny gray characters that no one could read without a microscope. So that's the general rule applicable to product packaging. Oh, sorry. Thank you.

Next category of rules, commercial publications. So that's anything that you're handing out to people. So it can be things like brochures, catalogs, commercial directories, anything like that. And now one of the recent updates under Bill 96, they updated this law to become a bit more modern. And they've now specified that it also includes to websites and corporate social media accounts.

So again, there, the rule is the same. Everything must be available in French. If you're using French and one or more other languages, that's fine, on condition that, again, the French is equally prominent. So when it comes to websites and social media, which is what most businesses are doing or putting their focus on these days, that requires, again, if you have an English version of your site, you must also have a French version.

In practice, we see it here all the time. Some of you have likely seen it as well. They'll be an option at the top of a web page to toggle back and forth between the English and French versions of the site. And here again, this equal prominence rule means that whatever is on your English version must also be on your French version.

So that's in terms of content. So every page that's on the English has to be translated, every video, every image, whatever you have must also be in French and in terms of functionality. So if the English version of the site lets you chat with customer service, if it lets you make an order online, anything like that, again, that must also be offered on the French version.

Next category, public signage and commercial advertising. So this is where things get a little bit more complicated in that, again, general rule, you must use French. If you want to use another language, that's fine too. However, here, it's not enough to have equal French and English text. Instead, you have to make sure that the French text is markedly predominant.

As for what markedly predominant means, that is a bit of a gray zone currently because the government-- so previously we had a regulation. There was a specific regulation on the definition of what is markedly predominant. That is currently in the process of being repealed under Bill 96. The government has put out a draft regulation that repeals that and provides new definitions. We're currently in a draft phase without giving going too much into Quebec politics because I don't think anyone wants to hear about that today.

They've been getting pushback on this bill. They're looking at modifying it. So all that to say currently, the markedly predominant rule means that on any public signs and commercial advertising in Quebec, the French text must be twice as large as the English text. Going forward, that when these new regulations are finalized and passed, it looks like that will still be pretty much the rule.

There may be a few nuances. There may be a few changes. There are also some exceptions to that right now, notably with regard to trademarks. Many trademarks are allowed to stay in another language. That exception is being significantly reduced. So this is a bit of a gray zone work in progress. But the general rule to keep in mind is any commercial advertising or public signs in Quebec, the French must be twice as large.

Last category we're going to look at is communication with Quebec-based employees. There, again, general rule is French. You're probably sensing a theme at this point. The law says that any written communications with employees, even after the termination of the employment relationship, must be in French. So contracts, emails, if you have employees-- if you have offices in Quebec, even something as silly as a posting on the bulletin board about the dates you're going to clean out the fridge, whatever it may be, must be in French. Again, exceptions here and there. That's a general rule.

So as you can see, the charter requires quite a bit of French in Quebec. You can use other languages but essentially, they want to make sure that French is just as prominent or more prominent. So that is, again, your 10,000-foot overview of charter requirements.

And now if you move on to the next slide and go back to question one, this is where things get a little bit more blurry and are a little bit less clear. So in terms of what are the actual rules under the charter set out in the law, pretty straightforward. As to when the charter actually applies, that is not set out in the law. So that's where we get into, again, a much grayer zone.

Traditionally, the regulator has taken the position that the requirements of the charter will apply to anyone who has a presence in Quebec or carries out activities in Quebec. Again, we don't have a definition. The way they have been approaching this is to say, to be subject to the rules of the charter, you must have either an address in Quebec, an employee in Quebec, a telephone number in Quebec. You must be registered with Quebec corporate authorities. You must have some sort of actual nexus tying you to Quebec.

So if we were having this conversation a few years ago, I would have said, that's the rule. If you don't have any of that, you don't have a presence here. They're going to take the position that they can't force you to comply with these rules. You're not here. You're not doing business here. You may just ship one or two things to Quebec occasionally. End of discussion. That's not enough to trigger the application of the charter.

Lately, however, in the past few years, we're seeing the regulator take a bit more aggressive of a stance. And we're seeing them apply the requirements of the charter to businesses who in the past they would not have deemed subject to these rules.

And I mean a whole separate issue here then is enforcement. So if someone has absolutely no presence in Quebec and they are going to say, well, you're not complying with these rules, we're going to come after you. how successful will they be there? That remains to be seen. And again, this is recent enough that we don't quite know the answer to that.

But putting that aside, because even if they, at the end of the day, could not come after you, they could still-- even if they legally don't have standing to say you must comply with this, they could still take you to court to argue that you do. And even if a judge is ultimately going to rule that you don't, you'd still have to deal with defending that case, which, again, would cost a lot of time and resources.

So putting aside that issue, as per the position of the regulator, do you have to comply with the charter? And then here we set out a bunch of scenarios. So if you're only shipping to Quebec. So again, here the answer to all of these questions is going to be very fact specific. And if you're only shipping to Quebec, it would again depend on your situation.

So if you say, we are based in the States. We ship all over the planet, including to Quebec. We ship a couple orders a year to Quebec. It's not a major market for us. We have no other activities there. It's unlikely that the regulator would say have to comply with French language rules.

However, if you ship products-- say, you may manufacture products, distribute products, whatever it is, and ship them to retailers, or distributors, or business partners in Quebec who then turn around and resell these on the Quebec market.

In that case, even if the question of whether or not you may directly be subject to the charter could be a bit uncertain. Your Quebec-based partner, they will clearly be subject to the charter. Which means that any products that they sell will have to comply with charter requirements. So then again, if we think back to the previous slide and the different kind of buckets of requirements that could apply.

The first one, the product packaging and labeling, undoubtedly, your product would have to be labeled in French if they're being sold into the Quebec market by Quebec-based businesses. Would the other requirements apply to you, your website, et cetera? Again, it would really depend on the nature of your relationship with your Quebec-based partners and your activities in Quebec.

So what we're typically seeing is the regulator is saying if you just happen to have a business partner in Quebec who you sell to and they're one of your, you know, many business partners, is that enough to say that you, who are based entirely in the States, your website must be in French? Unlikely.

If, however, you are actively trying to grow in the Quebec market, and even if you don't have employees here, you are sending your marketing team, your sales team here to try to find more clients, find more and enter into more agreements in Quebec.

Again, it's more likely that they would take the view, that be of the view that, well, yes, you don't have one of these traditional nexuses to Quebec but you are still carrying out business here. You are still trying to make a profit in Quebec. Therefore, we're going to apply these rules to you. Meaning it's not only your product sold by local businesses that would have to comply with these rules. Also, the rules that would apply to you as a business directly as opposed to your products.

And then we get to our next question, you hire a Quebec-based marketing or sales employee. Again, here, the answer is absolutely yes. It's very clear even if this, again, conversation were happening several years ago, it's clear that back then even the regulator would have taken the position that as soon as you have an employee in Quebec, these rules apply.

And a question that comes up quite often, especially now in this post-COVID era is we're based outside of Quebec. We're based elsewhere in the world. We have one or two employees in Quebec who work remotely. They work from home. We have no office. We have no phone number. No other presence in Quebec. We sell our products there. We have these employees working from home. Are we subject to the charter?

And there the regulator has very clearly taken the position that yes. So not only does that trigger the requirements with regards to your product sold in Quebec, but also with regards to these Quebec employees. Meaning you would have to provide them with French versions of their employment contract, with French versions of any other corporate communications, emails, training materials, et cetera.

And then last point on the list here, if you have a warehouse or office in Quebec, again, yes. That, too, comes back to the traditional approach of have this nexus to Quebec. You have an actual physical boots on the ground in Quebec. Quebec rules apply to you.

And then another question that comes up quite often is, does it matter if you're the importer of record or if someone else is the importer of record of any product you're shipping into Quebec for the application of these rules? And there, the answer is no.

What the Quebec regulator looks at, the Quebec regulator who's called the [NON-ENGLISH SPEECH] colloquially called the language police, they really just look at, again, this criteria of what are you doing in Quebec. They don't look at legally who's importing these products. They look at, are you involved, what are you doing--

They're separate from corporate authorities. Corporate terms like importer of record are not things that they consider. They really look at the facts of what are you doing in Quebec. Are you carrying out activities here. Are you trying to make money here. And if so, the charter will apply regardless of who is the importer of record.

So that is a very quick, very high level overview of Quebec language rules. Again, I mean, we could stay here talking about this all day, which I don't think anyone wants to do so we will not do that. As you can see, especially on this second question, it very much comes down to a fact-specific analysis and an assessment of what are you actually doing.

Are you actually trying to actively aid-- you have ties to Quebec, physical ties to Quebec. B, if you do not, are you actively trying to make a profit or carry out activities in the Quebec market versus are you maybe passively shipping a few things here just as you would ship them elsewhere. And that's often the deciding factor.

So I will leave you with that for now. If there are any questions, I would be happy to answer them. And also happy to chat more about this in the future with anyone else who may-- with anyone who may have additional questions or want to go a little bit further on any of this.

HUNTER FOX: Great. Thanks, Julia. Hello, everyone. I am Hunter Fox, associate in the Ottawa office. And I'm going to be speaking today about the new CBSA Import Portal. So CBSA is Canada Customs, if you're not familiar, the equivalent agency to the US CBP.

And they have decided to embark on probably the largest change that they've made, at least in the last couple of decades, introducing a brand new import portal that is going to facilitate all of the interactions that importers, customs brokers, and other trade chain partners will use to interact with the CBSA as part of their supply chains.

I'm going to start with a little bit of an overview about part of the reason why CBSA is undertaking this change even beyond the fact that the system needed an update. It has been paper based for a long time. And they've slowly been upgrading certain portions to allow for faster transactions and more electronic document exchange. But at the core of it, the customs system in Canada was still based on paper documents. And so this is going to be a brand new system that overhauls that and converts everything into the digital age.

The other issue is that a few years ago, the CBSA was subject to an audit by Canada's Auditor General who looks at waste, and government spending, and things along those lines. And they identified that CBSA was not collecting the appropriate amount of duties, and taxes, and penalties, and that compliance was quite low with Canada's customs laws. And they really seized on that as a way to rework the agency and make it more focused on, what I'll call, revenue generation in terms of looking at Canada's customs laws as a way to actually bring in money to the government.

Now, traditionally, the approach and the one I favor is that the customs agency should be more about facilitating business, and increasing trade, and making things easier for businesses. The CBSA has now been going in a bit of a different direction. And so it's important to understand that as part of that, as part of this process in terms of how importers and exporters should approach the CBSA going forward in terms of the issues that might pop up as we move into this new system.

The launch date is currently scheduled for October 21, 2024. There are some companies that are already using it because the current system has been planned to be released. I think it's been delayed for two years now. So nothing too surprising in terms of a major government project that experiences significant delays.

So there are already many, many importers that may be using the system. Some of you might be using the system right now. But the actual launch date in terms of when it will go live for everyone has been delayed until October. And so there's another few months in which everyone can get set up.

And that had been the concern from a lot of the importers, and exporters, and the various trade associations. There have been a lot of concerns about whether the CBSA was actually ready to go live with this. And it was supposed to go live a few weeks ago. And a bunch of the associations in Canada got together and they were able to actually have the government delay the implementation until October. And the concern is that the import community was not ready for this change and that CBSA would not be able-- would not be able to handle the launch at this time.

One of the biggest changes and where we're going to focus some of the attention today is on changes to the release prior to payment program. Now, some of you may be familiar with this. Some of you may not be. But basically, this system allows goods to be released at the border before the final accounting of all the duties and taxes is done.

And if you think about it from an e-commerce perspective or really, any type of supply chain at this point in time, it can be incredibly burdensome if every time you're bringing goods into the country that you had to go and settle the account with CBSA right then. And so what almost everyone does is they have a monthly accounting and you pay all your duties and taxes at that time. And that was typically arranged through your customs broker.

And so CBSA is changing that as part of the switchover to CARM, in that importers, both resident and non-resident, will need to arrange for their own security. And if they don't have their own security or cash deposit, then you will not be able to participate into the release prior to payment program.

As I mentioned, it's going to be switching over everything to the electronic commercial accounting declaration. So that should ease things up a little bit in terms of the paperwork and in terms of how your customs broker might be providing the documentation to CBSA. And there's going to be harmonized billing cycles and other electronic management of records.

Now, one of the other things and why we thought it was important to bring up today is that there's only been about 80,000 importers that have registered. And while this represents all of the major importers in the sense that it's-- in terms of the volume of goods that are going across the border, this is the vast majority of them. All of the big players have already been registered. There's still another 80,000-plus importers that have not registered for CARM and are not set up.

And so it's really important that if your organization is a non-resident importer, if you've got a Canadian subsidiary, if you're bringing goods across the border, if you work with importers in Canada who are buying your goods, it's important that you're checking in with them to make sure that they have this sorted out and that they are getting registered.

Because the later that companies delay and the closer that you go to the deadline, the greater the risk that your goods are going to be held up at the border. And that's been really the main concern from the import and export trade associations here in Canada, is that CBSA simply isn't going to be able to handle the amount of issues that are going to pop up once the system goes live. And so the more people that we can get sorted out in advance, the hope is that will alleviate some of the burdens on the system.

One other thing that I'll mention at this time is that CBSA is also switching over to automatic calculation of the duties and taxes in the CARM system. So as it currently works right now, the importer of record is responsible for calculating the duties and taxes themselves on the products that they import. And so you basically, you have your values. And you look at your duty rates. And you input all that on the customs documentation.

The issue is that, sometimes, there was mistakes being made, whether that was the wrong duty rate, the wrong number of units, multiplying by the wrong factors, using the wrong tax rates. So CBSA identified this as an area of concern. And they decided that they wanted to overtake that process.

The issue that's popped up and that they're working to address is that the calculation tables that they began using were not always correct. And so they basically took the same problem that the importers were having and now that's happening to CBSA.

And so it's important to get set up in the system as soon as possible so that you can start getting any of those kinks worked out so that you can get your goods flowing across the border once the system goes live. Or you can at least figure out how you're going to navigate some of the issues that you might be having before everyone is scrambling in October and you can't get through to CBSA to try and figure out the issue.

If you've got a customs broker or you're working with a customs broker, I'd recommend that you reach out to them to make sure that all of your accounts are in order. I know that the customs broker, they interact with CBSA through the same portal but in a bit of a different way because they're going to be managing potentially many different importers' accounts.

And so it's also important that you're working with other parties in that supply chain to make sure that everything has been arranged correctly. And I know that CBSA has been leaning heavily on the customs brokers to make sure that they're reaching out to all of their clients to make sure that everyone is on the same page. And so if any of this is not familiar to you or you're not sure whether your company is set up or not, it's always a good idea to go back to your customs broker and just make sure, OK, hey, are we all set up here. Is everything good to go.

And we can also assist you in terms of assisting with that process. Although as legal counsel, we typically don't use the systems ourselves. We're more advising on the outside in terms of whether you're actually meeting all of the requirements.

We can dive a bit more into the release prior to payment issue. And the other key change here is the importers can no longer use the customs broker security to clear shipments. And so as I mentioned earlier, that had been one of the key ways that the importers bringing goods into the country, especially importers that didn't import a huge volume of goods. It was simply much easier to be able to rely on your customs broker for that. But you're not going to be able to do that anymore.

The other change that is going away, although maybe not immediately due to some issues, is there was customs brokers that were offering to use their business accounts to import on behalf of non-resident importers. And so basically, the way that traditionally the system is supposed to work is that if you're a non-resident importer or an importer in Canada, you have to register for a business number with CRA, get set up with all your various government accounts.

Now, if you are someone who is doing e-commerce from the United States or other jurisdictions and you don't really have any business in Canada, you don't necessarily want to be interacting with the Canadian government, you could go to your customs broker and you can make an arrangement with them where they would use their business number and their business account to import the goods on behalf of you.

And CBSA has identified this as an issue as well because they were concerned about being able to pursue those non-resident importers for duties, and taxes, and other penalties related to trade compliance. And so they're introducing amendments that will make it more difficult to have that arrangement.

It won't be completely impossible to keep doing that. But the way that you interact with your customs broker through that arrangement will change. And many customs brokers are no longer doing it due to the potential risks that is presenting. Although, some do want to continue using it because they understand that it is a-- that it is a route that some companies want to proceed with.

So if you fall into one of those categories, again, it's going to be important that you figure out a path forward here in terms of what your supply chain is going to look like after October as all of these changes start to come in-- start to come into effect. So that you can make sure that your goods are not getting held up at the border or that your customers in Canada who are importing goods they have everything squared away so that you don't have any delays.

And while that's important for everyone, it's particularly important for companies that are importing perishable goods, things that might have to be stored under certain circumstances because the expectation at this point is that the delays and issues are going to be quite-- are going to be quite substantial. And no one's really sure exactly what this is going to look like once it goes live. And while CBSA has been working hard to address a lot of the issues, it's anyone's guess right now what's going to happen once this system actually goes into place.

In terms of the actual release prior to payment, in terms of what that financial security will actually look like, importers will have two options. And I've got them listed there on the screen. You can have a financial security instrument. So something like a bond that you would be able to get to cover 50% of the highest monthly accounts receivable with a minimum amount of $5,000 per import program.

And the second one is a cash deposit for 100% of the highest monthly accounts receivable. And so depending on your specific circumstances, one of those options might be more favorable to you. I believe most people end up going with the financial security instrument just due to the lower amount. But sometimes, importers, especially smaller ones, just prefer to do the cash deposit for the highest monthly accounts receivable.

What happens if you don't listen to any of the advice and you don't post the financial security? If you don't, you're going to have 180 days, so six months after CARM goes live to basically be able to get your security in order. And if you don't, then you're going to be removed from the RPP Program. So that wouldn't be a good thing. You have to try and get back in the program.

So I'd recommend that everyone get that squared away now or at least start looking into it while you still have a few months so you can get that sorted out. Especially if you're a smaller importer and you're not interacting maybe with your customs broker on a regular basis, you're not importing goods on a regular basis, the way that you are going to be using the CARM system may not be the same as a major importer. And so it's important that you figure out all the various steps that you're going to need to take.

It's not that it's necessarily that difficult or that you won't be able to do it. But it's more so tracking down who has those accounts, are we registered, where are the passwords, are we going to be using this bank account, this credit card, how are we going to be proceeding. And it just becomes all of those little tasks that fall by the wayside. And then at the last minute when you're scrambling, there can be delays in your supply chain.

In terms of how you actually calculate what the financial security requirement will be, CBSA will help you out there. Now the caveat is that if things don't look normal if you use CBSA's calculation, you may want to talk to them to figure out what's going on because as I said, their calculations haven't always been accurate. But they will give you what their expectation is in terms of the RPP that you're going to be required to post.

Now, if you feel that your circumstances have changed, maybe you're going to be importing less, maybe you are now utilizing a free trade agreement, maybe you've started manufacturing your goods in a different jurisdiction and you don't have to pay the same amount of duties, you can talk to the CBSA and an officer can decide to manually approve a lower amount. Does anyone have any questions about the RPP program, or CARM Portal, or any of Julia's presentations on the French language rights? We'd be happy to answer any questions that anyone has.

LAURA GHEORGHIU: Hunter, I see one question from John. He says, will the couriers and mail services such as Purolator, DHL, or FedEx retain their ability to perform entry on behalf of non-resident importers without the non-resident registering as an IOR?

HUNTER FOX: So that's going to depend specifically on which program the goods are being imported under. So I would need to have a little bit more information because depending on the specific system, you may be able to do that or you may not be able to do that.

For example, Canada Post is able to use the postal stream, which isn't available to other customs brokers. So for example, if you're using DHL, they're not going to be able to use the postal stream. Canada Post will still be able to. But if you are using a customs broker, then you're going to have to speak to them to figure out exactly how the arrangement is going to work going forward.

Because as I said, some of them will still allow you to use their business number to clear shipments. But they're typically requiring new agency agreements that limits the liability because CBSA is trying to push all that liability onto the customs broker for basically acting on behalf of the non-resident importer and saying that if there's any issues with that non-resident importer, they don't pay the right duties and taxes, we're coming after you, customs broker. And so customs brokers in response are saying, well, we don't want to do that anymore. Or if we do, we're going to have a lot of requirements of our non-resident companies that we're dealing with.

LAURA GHEORGHIU: Right. I Don't know if we have other questions. Oh, let me see. OK, we got more. I'm going to just go in order. Kelly is asking, even if we have obtained a bond as a non-resident importer, I've heard mixed messaging on whether our brokers will be able to pay our statement on our behalf?

HUNTER FOX: So again, this is why it's really important to get set up as soon as possible because I only touched on some of the issues and really only on the issues from the importer side. I know that the brokers themselves have been having a lot of difficulty.

One of the issues, for example, was there was no way for the brokers to all of the updates that they were getting. And so you can imagine a customs broker that has thousands of customers who they're interacting with CBSA on and they're getting thousands of documents into their car mailbox. And there was no way for them to filter by their customer. And so they were having to go through each individual document trying to figure out who it related to. And that's just one example of some of the issues that were occurring.

And so definitely, that's been an issue. This is why it's super important get that you get this sorted out as soon as possible. Now it may not be-- we may not be able to address every issue in advance. But the more that you can do to frontload all of that work, it's just going to make things easier for you once CARM goes live. But those are just some of the issues that are popping up right now.

LAURA GHEORGHIU: OK. And Omar is, I think adding to the same stream of questions where he says, will the CARM's bonds be available to-- when will they be available to be submitted? Does he have to wait until October 21?

HUNTER FOX: No, it depends. I would talk to your broker, Omar, and figure out exactly where you've been set up with it in terms of where you are in the process. Because some companies were of this early release schedule. And so they've already been using CARM and they've already been interacting with the system. Other people aren't at that stage yet. And so it's important that you figure out where your company is specifically in that process.

LAURA GHEORGHIU: OK. And Hunter, I guess, when we go into the details about the posting of security, Amy is asking about whether the CRA accepts Canadian dollars from non-Canadian banks as a non-resident cannot use direct payments, credit card payments are limited to $5,000? So I guess your experience there. I can share a little bit of my experience on the taxpayer side.

HUNTER FOX: Yeah. So that has also been an issue in terms of importers figuring out, especially ones that don't have Canadian bank accounts. Now, there are other ways that you can speak to your customs broker in terms of trying to get-- in terms of trying to get set up with whatever information that they're going to need.

Now, I don't know whether you would consider opening up a Canadian bank account or opening up a bank account in Canadian dollars might be something that perhaps you, Laura, can touch on. But I know that's been a big issue for some of the smaller importers.

LAURA GHEORGHIU: Yeah. I think whenever you're paying the CRA in Canadian dollars or paying CRA period as a non-Canadian, you have to explore whether it can be a wire transfer or whether you can have a Canadian dollar account with a US bank.

I would just be very careful about opening a Canadian account with a Canadian bank. If you already have other Canadian presence, just income tax perspective, you don't want to create a carry-on business. And obviously a bank account on its own will not do it. But plus other things, it might just be an extra factor. So it's understandably an issue that needs to be addressed.

Perfect. So I think those are all the questions. We want to thank everyone for being with us today. I really want to extend a huge thank you to Julia and Hunter for the presentation and to Shannen and again for having us here today.