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A sad and unfortunate situation for an online shopper in Australia highlights the importance of import and export permits and licenses in international trade.

While the purchaser in this particular situation was engaged in a B2C transaction, import and export permits and licenses are often required in B2B transactions, and can give rise to seizure and confiscation of goods being imported or exported from Canada in a variety of different contexts.

In this case, the purchaser was in Australia and paid over AUD $26,000 for an alligator-skin handbag – ordered online from a boutique in France.  When the handbag arrived in Australia, it was seized by customs officials and subsequently destroyed – all because it lacked the proper import permit!

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In the current global business environment, increasingly many US companies are selling their goods into Canada, and using a variety of business structures to do so.  However, many companies continue to struggle with their tax and customs obligations on these transactions.  In particular, issues often arise with determining the proper value for duty of the goods at the border, and companies are often further confused between their Division II and Division III GST/HST obligations under Canada’s Excise Tax Act.

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Exporters of goods from Canada may be surprised to receive a Notice of Detention from the Canada Border Services Agency (CBSA), indicating that their goods have been detained on the way out of the country.

Under section 101 of the Customs Act, goods that are about to be exported may be detained by a border services officer “until he is satisfied that the goods have been appropriately dealt with in accordance with this Act, and any other Act of Parliament that prohibits, controls or regulates the importation or exportation of goods, and any regulations made thereunder”. 

There are a number of possible reasons for a “detention”, ranging from errors on export forms to exports contary to Canadian export controls.

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A recent audit initiative of the Canada Revenue Agency (CRA) has targeted financial service intermediaries – and in particular, member service providers (“MSPs”) that are engaged in business in the credit card/electronic payment industry.  These are the businesses that provide “point of sale” (POS) visa machines to merchants, for customers to use when paying for goods and services purchased in various retail establishments.

While seemingly providing goods and services to the retail merchants, in fact, the MSPs usually enter into contracts with credit card payment processing companies (“Members”), whereby they recruit retail merchants to contract with the Members for the retail merchants’ payment processing needs. The MSPs’ services include negotiating fees with the merchants on behalf of the Members and otherwise acting as the main point of contact for the merchants in respect of their credit card processing matters. The MSPs also provide services in relation to the installation and operation of the point-of-sale credit card processing equipment at the merchants’ retail locations.

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A recent decision of the Court of Appeal for Ontario (the “ONCA”) has created doubt as to the enforceability of certain arbitration clauses in independent contractor agreements – which will likely require all direct selling companies to want to review and retool their own clauses.

In Heller v. Uber Technologies Inc., 2019 ONCA 1 (“Heller”), an Ontario Uber driver commenced a proposed class action against Uber entities.  The Uber driver alleged that Ontario Uber drivers were improperly classified by Uber as independent contractors, when they were lawfully employees entitled to the protections of the Ontario Employment Standards Act, 2000 (the “ESA”). The class action sought a declaration that Uber had violated the provisions of the ESA and asked for $400 million in damages.

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Should you really dispute the CRA’s finding that your supplies are taxable and not exempt?

Many of the “exempt” versus “taxable” cases that we see from the GST/HST perspective put the recipient (the one usually arguing for “exempt” treatment) and the supplier at odds.

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The Ontario Court of Appeal’s recent decision in Canada Life Insurance Company of Canada v. Canada (Attorney General) (2018 ONCA 562) seems to have put a final stake in the heart of equitable remedies in tax matters.  The case dealt with rescission, and has the effect – along with prior Supreme Court jurisprudence – of clarifying that the equitable remedies of rescission and rectification will not generally be available to taxpayers seeking to correct drafting or planning mistakes.

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On October 23, 2018, the Conservative-led Government of Ontario announced Bill 47, Making Ontario Open for Business Act, 2018. If Bill 47 passes, it would make a number of significant changes to the Employment Standards Act, 2000 and the Labour Relations Act, 1995, including repeals of many of the workplace reforms made last year by the then-Liberal government.

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Amendments to Canada’s federal privacy legislation, the Personal Information Protection and Electronic Documents Act (PIPEDA), are coming into force on November 1, 2018. These amendments impose upon organizations mandatory reporting, notification, and record-keeping requirements in the event of a privacy breach. The new rules are intended to ensure that Canadians receive sufficient information about privacy breaches regarding their personal information, to promote better data security practices by organizations, and to harmonize with the privacy laws in other jurisdictions (most notably with the European Union’s General Data Protection Regulation).

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