RCC Member Alert: Possible Issues with Customs Brokerage

This may not be a widespread issue, but we have been made aware of some customs brokers telling their retail clients that goods shipped through the US but originating elsewhere would be subject to the 25% retaliatory Canadian tariffs. That is not correct.

The 25% Canadian tariffs apply only to listed goods of US production/manufacture.  They do not apply to goods from other countries that happen to be shipped through the US unless there is further significant change made to the product after it enters the US and before it enters Canada.

Simply put, the Canadian government does not care where a product is shipped from, it cares where it was made. So, a Swiss watch bought in Dubai and flown here is Swiss. A Mexican avocado shipped by truck through the US is Mexican, and so on.

We have spoken to the senior leadership of the Department of Finance, which sets the tariffs, and they confirm our understanding. We have also alerted the Canadian Society of Customs Brokers, so that they can communicate this to any of their member brokers who have a misunderstanding of the rules.

If you do encounter this problem, please contact Karl Littler, RCC’s SVP Public Affairs at klittler@retailcouncil.org.