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Customs & International Trade

What can you do when customs reassesses your duty?

Customs reassessments frequently reach back several years and arrive with penalties and interest attached, which is what turns a technical disagreement into a material liability. The three recurring grounds are classification under the tariff schedule, the declared value, and country of origin. All are contestable, and all run on short protest deadlines from the date of the decision.

What to do next

  1. Identify the ground and the period covered

    Classification, valuation or origin - and how many years of entries have been reassessed. The retroactive reach is usually what makes these material, and it determines whether a voluntary correction for other periods is worth considering.

  2. Build the technical argument

    Classification turns on the tariff schedule's rules of interpretation, explanatory notes and prior rulings on comparable goods. Product specifications, composition and function matter more than commercial description or how you have always described it.

  3. Check the valuation method applied

    Transaction value is the primary method, with alternatives applied in a defined order. Disputes commonly involve related-party pricing, assists, royalties and commissions - whether they belong in the dutiable value is a technical question with real answers.

  4. Diarise the protest deadline

    Periods to file are short and run from the decision. Interest accrues throughout, so delay is expensive even where you ultimately succeed.

  5. Consider voluntary disclosure for other periods

    Where the reassessment reveals an error affecting entries the authority has not yet examined, a voluntary correction usually attracts materially lower penalties than waiting to be found. Take advice before disclosing.

Frequently asked questions

How far back can they reassess?

Typically several years, and longer where misrepresentation is alleged. The retroactive reach is usually what makes a reassessment material.

Can I get an advance ruling?

Yes, and it is worth doing. An advance ruling on classification, origin or valuation binds the authority for future shipments and prevents recurrence.

Do I have to pay while disputing?

Often payment or security is required to file a protest. Interest accrues regardless, which affects the economics of a long dispute.

What about penalties?

Administrative penalties commonly accompany reassessments and can be challenged separately, particularly where you exercised reasonable care.

Which tribunal hears the appeal?

The Canadian International Trade Tribunal in Canada, the Court of International Trade in the United States, with appeals to the Federal Court of Appeal and Federal Circuit respectively.

This is general information, not legal advice. Laws vary by location and every situation is different — speak with a qualified lawyer about your specific circumstances.

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