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Canadian Import/Export Laws

Expert: Trade Information Officer at the office of Ontario Exports

Geoff asked:

My question is, my business is a hobby venture. What are the implications of selling low-priced goods to the world online? If I only make a small amount of money (just to cover expenses) should I be concerned with import/export laws?

Trade Information Officer at the office of Ontario Exports answered:

"In answer to the question, any physical goods shipped across any international border (i.e. the United States or otherwise) are subject to the duties and taxes applicable in that country. Ordering goods over the Internet is essentially no different than ordering them from a home shopping channel or mail-order operation. The laws governing the sale of goods over the Internet in Canada would be limited to product warranties and liabilities.

For the moment the Canadian Radio and Telecommunications Commission (CRTC) backed off passing regulations that would impose new restrictions on Internet use and content. The same applies to Britain and the U.S. Other countries are developing their own policies, which vary. The People's Republic of China has a stringent monitoring policy although this is not aimed specifically at the sale of goods over the Internet. Using the Internet as a sales channel is therefore not that different from using telephone, mail or direct marketing to fulfil orders.

That being said, the physical product being shipped is subject to all of the regulatory provisions of the country it is being sent to. An example would be CSA approval for electrical devices sold in Canada. The best source for information on tax, duty and shipping rates would be a broker or a carrier that has in-house brokerage facilities. An example of such firms would be (in no particular order) Federal Express, Purolator, UPS, Livingston, etc. Products classified as hazardous goods would be very unlikely to pass a border inspection.

If a product is exported from the province to a foreign territory, the seller does not pay GST and PST. The buyer pays their relevant federal and local sales taxes upon receipt of the goods. An international carrier that delivers door to door will often collect these taxes at the time of delivery according to the declared value of the goods on the package.

Further information can be obtained from the Canada-Ontario Business Service Centre (COBSC).
COBSC can be reached at:
Tel: (416) 954-4636
Fax: (416) 954-8497

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