Canada Gazette, Part I, Volume 156, Number 48: Financial Security (Electronic Means) Regulations

November 26, 2022

Statutory authority
Customs Act

Sponsoring agency
Canada Border Services Agency

REGULATORY IMPACT ANALYSIS STATEMENT

For the Regulatory Impact Analysis Statement, see Regulations Amending Certain Regulations Administered and Enforced by the Canada Border Services Agency.

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council proposes to make the annexed Financial Security (Electronic Means) Regulations under paragraph 8.6(1)(a)footnote a and subsection 166(1)footnote b of the Customs Act footnote c.

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to Janine Harker, Director, Commercial and Trade Policy Division, Strategic Policy Branch, Canada Border Services Agency, 10th Floor, 100 Metcalfe Street, Ottawa, Ontario K1A 0L8 (email: CBSA.OCT/CECO.ASFC@cbsa-asfc.gc.ca).

Ottawa, November 17, 2022

Wendy Nixon
Assistant Clerk of the Privy Council

Financial Security (Electronic Means) Regulations

Definitions and Application

Definitions

1 The following definitions apply in these Regulations.

Act
means the Customs Act. (Loi)
debtor
means the person required to give security under the Act or the Customs Tariff. (débiteur)
security agreement
means an agreement between a debtor and a surety under which the surety guarantees payment of amounts that the debtor owes under the Act or the Customs Tariff. (contrat de garantie)

Application

2 These Regulations apply to security required under the Act or the Customs Tariff.

Security

Nature of security

3 For the purposes of paragraph 166(1)(b) of the Act, security required to be given must be a deposit or a written security agreement.

Security agreement — deemed terms and conditions

4 (1) The following terms and conditions are deemed to be an integral part of every security agreement and take precedence in the case of any conflict or inconsistency with any other provision of the security agreement:

Surety

(2) The surety that is a party to a security agreement must be one of the following:

Electronic means

5 (1) Subject to subsection (4), all security must be given by means of the electronic system specified by the Minister.

Security agreement — information

(2) In the case of a security agreement, the surety must either provide or confirm the following information by means of that system:

Update information

(3) The debtor and the surety must ensure that all information provided under subsection (2) is updated within two days after any change.

Exceptions

(4) Despite subsection (1), the Minister may require that security be given by any other means that is made available or specified by the Minister for that purpose if the Minister determines that

Copy of security agreement

6 On the Minister’s request, the debtor or surety must provide a copy of the security agreement to the Minister by means of the electronic system specified by the Minister.

Termination of security agreement

7 (1) The surety must give at least 30 days’ notice, by means of the electronic system specified by the Minister, of the termination date of the security agreement.

Amounts owing

(2) The Minister may claim from the surety amounts that accrued before or were payable on the date of the agreement’s expiry or termination.

Enforceability

8 (1) Subject to section 9, the Minister may enforce a security agreement once the surety has either confirmed or provided, in accordance with subsection 5(2), the information set out in that subsection.

Amount

(2) The amount that the Minister may claim from the surety is the lesser of the amount that the debtor owes under the Act or the Customs Tariff and the amount of the security that the surety provided or confirmed in the electronic system under paragraph 5(2)(e).

Enforcement process

9 (1) If the debtor has failed to pay an amount that they owe under the Act or the Customs Tariff by the day on which the amount is payable, the Minister may send the surety a notice of claim that sets out the amount claimed and the information set out in subsection 5(2) that the surety provided or confirmed in the electronic system.

Limitation period

(2) In the case of a security agreement that has expired or been terminated, the Minister must send the notice of claim within one year after the date of the agreement’s expiry or termination.

Timeline

(3) Within 60 days after the day on which the notice of claim is sent to the surety, the surety must pay His Majesty in right of Canada the amount claimed or provide the Minister with information to rebut the claim.

Decision

(4) If the surety provides information under subsection (3), the Minister must review the information, make a decision in relation to the claim and notify the surety of the decision.

Requirement to pay

(5) The surety must pay the amount claimed on receipt of the Minister’s decision to that effect.

Payment by surety

10 For greater certainty, the payment of an amount by the surety to His Majesty in right of Canada under subsection 9(3) or (5) does not relieve the debtor or any other person from liability to pay any amount otherwise owed.

Transitional Provision

Continuation of security

11 These Regulations do not apply to security, other than security given under the Accounting for Imported Goods and Payment of Duties Regulations, that has been given under the Act or the Customs Tariff and that is valid immediately before the day on which these Regulations come into force. Such security continues to be valid until the day on which it expires or is terminated.

Coming into Force

S.C. 2022, c. 10

12 These Regulations come into force on the day on which section 303 of the Budget Implementation Act, 2022, No. 1 comes into force, but if they are registered after that day, they come into force on the day on which they are registered.

Terms of use and Privacy notice

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