Your Broker Knows

To bond or not to bond – that is the question. Since April 1, 2011 when the requirement for commercial carriers to have a carrier code was implemented, this has been a popular question.

If you are considering which situation best suits your operation, here”s a few tidbits that will help you in your decision making process.

NON- BONDED CARRIERS

A non-bonded carrier must have the shipment released at the first point of arrival (i.e. the border). However, if the non-bonded carrier cannot obtain release of the shipment at the border and chooses to bring a shipment inland for release at another   Canada Border Services Agency (CBSA) Office, the carrier must post a single trip authorization bond at the Canadian border or be authorized to use the carrier code of a bonded carrier. Otherwise, the non-bonded carrier may be issued a penalty.

To become a non-bonded carrier, an application must be submitted with proof of ownership documents. There is no fee associated with this application when dealing direct with Canada Border Services Agency. Their processing time is generally 1 month.

 BONDED CARRIERS

A bonded carrier posts security with the Canada Border Services Agency to cover the following:

• To move goods to an inland CBSA Office (not located at the border) in order to have the shipment released;

• To move goods “in transit” through Canada. The bonded carrier uses Canada as a corridor, or a shortcut, by starting from a point outside Canada and then transiting through Canada to another point outside Canada. The goods in transit are never released from Custom”s control in Canada;

• To apply to the Customs Self Assessment Program and/or the Free and Secure Trade (FAST) Program; or

• To apply to the Post-Audit Program.

To become a bonded carrier, the process is more in-depth than the non-bonded application. You must work with an approved agent and/or Surety Company to initiate the bond application process. An application must be completed and company financials provided for a review. If approved, the carrier will then select the term you want the bond for (1 or 2 years). All original signed documentation is then sent to Customs for final approval. There is a fee associated and the entire process takes approximately 6 weeks.

In both cases, the carrier will need to obtain bar-coded labels once an assigned carrier code is received.   Non-bonded highway carriers have 30 days after receiving their carrier code to obtain bar-coded labels. After 30 days, an Administrative Penalty of $1,000 will be imposed on carriers if bar-coded labels are not presented with their shipments upon arrival at the Canadian border.

Pacific Customs Brokers is an authorized printer and can supply you with bar-coded label service.

Did you know: Bonded carrier codes start with a 2,3 or 4 and non-bonded codes start with a 1 or 7.

Pacific Customs Brokers can help you with each of the following services, please contact us at 888.538.1566   for further information:

1. Non-bonded carrier code application
2. Bonded carrier code application
3. Single trip authorization bonds
4. Barcode label printing