piggy bank amps penalties to increase April 1What is the Administrative Monetary Penalty System (AMPS)?

The Administrative Monetary Penalty System (AMPS) was established by the Canada Border Services Agency (CBSA) in 2002 to encourage compliance with import and export rules and regulations and create a level playing field for Canadian businesses participating in international trade. The program allows the CBSA to issue monetary penalties to any commercial entity involved in the clearance, handling, or movement of goods being imported or exported. This includes importers, exporters, carriers, freight forwarders, warehouse operators, and customs brokers.
AMPS Penalties by the Numbers

In 2017, recommendations from the Auditor General’s Spring Report resulted in significant changes to CBSA’s processes and procedures, including increased border enforcement measures and compliance audits on Importers. The amount of AMPS penalties in both number of occurrences and dollar continue to rise each year. AMPS contraventions in 2017 totaled $12,288,375 in penalties issued.
How are AMPS Penalties Assessed?

AMPS penalties result when an organization fails to comply with legislation and requirements identified in the Customs Act, Customs Tariff Act, and related regulations. CBSA maintains a Master Penalty Document listing all contraventions, describing the failure to comply and the associated penalty amount. Examples of non-compliance include:

  • Failure to pay duties
  • Failure to submit required information and documents to the CBSA
  • Failure to report goods to the CBSA
  • Removing goods from a bonded warehouse prior to release by the CBSA

Penalties under the Administrative Monetary Penalty System may be issued due to non-compliance identified by a CBSA Officer at the border or through post-release verification of company records. Penalties may also result from a Trade Compliance Verification conducted by the CBSA, randomly, or through verification priorities.

Read: Canada Customs Trade Compliance Audit Targets
What Happens if You Receive an AMPS Penalty?

If you are issued a penalty you will receive a Notice of Penalty Assessment (NPA) from the CBSA. The NPA will describe the reason for penalty assessment, the corresponding contravention number (e.g. C005), and the penalty amount incurred. The penalty structure is graduated and progressive, with increased penalty amounts for repeat occurrences. The maximum penalty amount for a single contravention is $25,000. 

CBSA maintains a record of contravention history for three (3) years. This can affect your business operations due to increased monitoring and inspections by CBSA when importing or exporting goods.
How to Avoid AMPS Penalties

Importers and exporters are ultimately responsible for providing accurate and complete information to the CBSA regarding their shipments. Understanding the requirements related to your imports and exports and working with vendors and services suppliers, including Customs Brokers and Freight Forwarders, is the first step in remaining compliant. Regularly reviewing your importing and exporting practices and developing a compliance plan will help to ensure compliance over time.
We Can Help

PF Collins can assist in avoiding CBSA fines and penalties. Whether you require a Customs Broker to accurately classify and clear your goods or Customs Consulting & Compliance services to help guide you through a compliance audit, we can help. Contact us in St. John’s, Halifax, or Calgary today to help with your international shipping needs!