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MAJOR CHANGES TO CUSTOMS LIABILITY!

"IMPORTER OF RECORD" WILL BE JOINTLY LIABLE FOR PAYMENT OF DUTIES AND TAXES

On January 1, 2026, amendments to subsection 17(3) of the Customs Act (“CA”) come into force that make the “importer of record” jointly liable with the owner of the goods for duties and taxes on imports.

This development will impact customs brokers in the freight forwarding industry who have enjoyed protection from customs liability for the past few years. 

Following the coming into force of these amendments, there may no longer be any escape of liability for duties when a broker identifies itself as the “importer” (i.e., using its name and business number to obtain release of an import from the Canada Borde Services Agency (the “CBSA”)). 

Many in the E-commerce business will be affected.  Previously, foreign E-commerce merchants would export to Canada and have an immune-from-liability broker act as “importer of record”, leaving CBSA with few recovery options if duties were ever unpaid/disputed. 

Background to the Changes

These Amendments come as a response to the 2020 decision of the Canadian International Trade Tribunal (the “CITT”) in Landmark Trade Services v. President of the CBSA (Case No. AP-2019-002) (“Landmark”).  We blogged about that 2020 decision here, and the ensuing fallout here.

In that decision Landmark, a customs broker, was assessed by the CRA in respect of certain imports for which it acted as “importer of record” and the tariff classification had been incorrect.  The imports involved e-commerce shipments purchased by individual Canadians, and Landmark used its own Import/Export number, filed all relevant import documents, and paid all applicable duties and taxes in importing the goods.  

At the CITT, Landmark succeeded in avoiding liability for duties on the basis that Landmark was technically neither the “importer” nor the “owner” of the goods but was rather a mere “paper intermediary”.  They did all the work to clear the goods through customs, but were not on the hook for duties/taxes.

While Landmark and customs brokers like it will still not technically be “importers” for customs purposes in the eyes of the CITT, the amendments add a definition for “importer of record” to subsection 17(4) and extend the joint liability to the importer of record in subsection 17(3) of the Customs Act.    

Guidance from CBSA

Guidance released by the CBSA demonstrates how its policies will change once these amendments come into force. 

The CBSA will now treat the “importer of record” who completes the import forms as the primary contact for customs verifications, and the entity with direct liability for record keeping, making corrections, and paying taxes and duties – including those from re-determinations, long after import.

Other persons who are owners or importers in the eyes of the CBSA will continue to share liability and may still be contacted for verification purposes. 

Takeaways

As of January 1, 2026, the “importer of record” will share liability for duties and taxes with any other owners/importers. 

Anyone completing customs documentation as the “importer” should carefully consider whether to continue to do so given the heightened risk of joint and several liability for duties under the Customs Act. 

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