Canada-Israel Free Trade Agreement

CHAPTER SIX
TRADE FACILITATION

Article 6.1: Objectives and Principles

1. The Parties acknowledge the importance of customs and trade facilitation matters in the evolving global trading environment.

2. The Parties shall, to the extent possible, cooperate and exchange information on best practices for the purpose of promoting the application of and compliance with the trade facilitation measures agreed upon under this Agreement.

3. Each Party shall ensure that its import, export, and transit requirements and procedures are no more trade restrictive than necessary to achieve legitimate objectives.

4. The Parties shall use international trade instruments or international standards, as determined by the Parties, as the basis for import, export and transit requirements and procedures, if these instruments and standards exist, except when they would be an inappropriate or ineffective means for the fulfillment of the legitimate objectives pursued.

Article 6.2: Transparency

1. Each Party shall  publish or otherwise make available, including by electronic means, all its laws, regulations, judicial decisions and policies, as well as administrative rulings of general application relating to its requirements for imported or exported goods, in accordance with its law.

2. Each Party shall, to the extent possible, publish in advance, including on the internet, any regulation of general application governing customs matters that it proposes to adopt and provide interested persons with the opportunity to comment prior to its adoption.

3. Each Party shall designate or maintain one or more contact points to address enquiries by interested persons concerning customs matters and make available on the internet information concerning the procedures for making these enquiries.

Article 6.3: Risk Management

1. Each Party shall adopt and apply import, export, and transit requirements and procedures for goods on the basis of risk management principles that focus compliance measures, including release, examination and post-release verification procedures, on transactions that merit attention rather than examining each shipment.

2. The procedures described in paragraph 1 must distinguish between goods of low, high and unknown risk, with the objective of facilitating and simplifying the processes and procedures for the release of low risk goods, while improving controls on the release of high or unknown risk goods.

3. Paragraphs 1 and 2 do not preclude a Party from conducting quality control and compliance reviews, which may require more extensive examinations.

Article 6.4: Release of Goods

1. Each Party shall adopt or maintain simplified customs procedures for the efficient release of goods in order to facilitate trade between the Parties and reduce costs for importers and exporters. Each Party shall ensure that its procedures:

• (a) allow for the release of goods within a period no greater than that required to ensure compliance with its law;
• (b) allow goods, and, to the extent possible, controlled or regulated goods, to be released at the first point of arrival;
• (c) allow for the expeditious release of goods in emergency situations, such as natural disasters; and
• (d) allow for the withdrawal of goods from customs control before the final determination of the applicable customs duties, taxes and fees, by its customs administration, in accordance with its law. Before releasing the goods, a Party may, in accordance with its law, require the payment of customs duties, taxes, fees and charges determined prior to or upon arrival of goods or require an importer to provide sufficient guarantee in the form of a surety, a deposit or other appropriate instrument, provided for in its laws and regulations, to cover the ultimate payment of customs duties, taxes or fees in connection with the importation of the goods. The guarantee must be limited to an amount calculated to ensure compliance with payment of customs duties, taxes and fees, and must not represent an indirect protection of domestic products or a taxation of imports for fiscal purposes.

2. Each Party may require the submission of more extensive information through post-release accounting and verification, as appropriate.

3. Each Party shall, to the extent possible, ensure that its authorities involved in border and other import and export controls cooperate and coordinate to facilitate trade by, among other things, harmonising import and export data and documentation requirements, and establishing a single location for one-time documentary and physical verification of consignments.

4. Each Party shall ensure, to the extent possible, that requirements related to the import and export of goods are coordinated to facilitate trade, regardless of whether these requirements are administered by one or more of its authorities.

Article 6.5: Express Shipments

Each Party shall adopt or maintain separate customs procedures for the expedited release of express shipments. These procedures shall:

• (a) if applicable, use the World Customs Organization’s Guidelines for the Immediate Release of Consignments by Customs;
• (b) to the extent possible or if applicable, provide for advance electronic submission and processing of information before the physical arrival of express shipments to enable their release upon arrival;
• (c) to the extent possible, provide for clearance of certain goods with a minimum of documentation; and
• (d) provide for, in accordance with a Party’s law, simplified documentation requirements for the release of low-value goods as determined by that Party.

Article 6.6: Automation

1. Each Party shall use information technologies that expedite its procedures for the release of goods in order to facilitate trade, including trade between the Parties.

2. Each Party shall:

• (a) endeavour to make available by electronic means customs forms that are required for the import or export of goods;
• (b) allow customs forms to be submitted in electronic format in accordance with its law; and
• (c) if possible, through its customs administration, establish a means of providing for the electronic exchange of information with its trading community for the purpose of encouraging efficient release procedures.

3. Each Party shall endeavour to:

• (a) develop or maintain a fully interconnected single window;
• (b) develop a set of common data elements and processes in accordance with the World Customs Organization’s Data Model and related recommendations and guidelines of the World Customs Organization; and
• (c) harmonise the data requirements of its respective authorities with the objective of allowing importers and exporters to present all required data to one authority.

Article 6.7: Advance Rulings for Tariff Classification

1. A Party shall issue a written ruling prior to importation regarding tariff classification applicable upon importation, except for any form of surtax or surcharge, in response to a written request from one of the following applicants:

• (a) an importer in its territory;
• (b) an exporter or producer in the territory of the other Party; or
• (c) a representative of a person in subparagraph (a) or (b).

2. An advance ruling issued by a Party shall be binding on that Party only in respect of the applicant that requested it.

3. In accordance with its law, each Party shall:

• (a) adopt or maintain procedures regarding the issuance of advance rulings, including:  the request for, application of and modification or revocation of an advance ruling, as well as the request by a Party for supplementary information and instances when an advance ruling may be postponed or declined;
• (b) ensure that an advance ruling is issued within a period of 120 days after the Party has obtained all necessary information from the applicant;
• (c) provide that an advance ruling is in effect from its date of issuance, or another date specified in the ruling, and remains in effect unless relevant facts or circumstances change; and
• (d) provide consistent treatment with respect to the application for advance rulings, provided that the facts and circumstances are identical in all material respects.

4. Each Party may modify or revoke an advance ruling retroactively only if the advance ruling was based on inaccurate or false information.

Article 6.8: Review and Appeal

1. Regarding decisions on tariff classification of imported goods, value for duty of imported goods, advance rulings for tariff classification pursuant to Article 6.7, administrative penalties pursuant to Article 6.9, and any seizures of imported or exported goods, each Party shall, in accordance with its law, grant access to:

• (a) at least one level of administrative review within the same authority of the official or office responsible for the decision under review; and
• (b) judicial review or appeal of the decision taken at the final level of administrative review.

2. For all other decisions on customs matters, each Party shall, in accordance with its law, grant access to either an administrative review or judicial review or appeal of the decision, or both.

3. Each Party shall ensure that the official or office responsible for the administrative review is independent of the official or office responsible for issuing the decision under review.

4. Each Party shall ensure that the official or office responsible for the administrative or judicial review or appeal has the authority to maintain, modify or reverse the decision under review.

Article 6.9: Administrative Penalty Regime

1. Each Party shall adopt or maintain measures that allow for the imposition of administrative penalties for violations of its customs laws.

2. Each Party shall ensure that any penalties imposed for a breach of its customs laws, regulations or procedural requirements are proportionate and non-discriminatory and, in their application, do not result in unwarranted delays.

Article 6.10: Authorised Economic Operators

1. The Parties shall implement Authorised Economic Operator (“AEO”) programmes that aim to ensure international supply chain security while facilitating trade. To that end, the Parties recognise the importance and value of the World Customs Organization’s SAFE Framework of Standards to Secure and Facilitate Global Trade.

2. Each Party shall promote the granting of AEO status to its economic operators with a view of achieving trade facilitation benefits and international supply chain security.

3. In order to further enhance the trade facilitation measures provided to its authorised economic operators, the Parties shall explore the possibility of negotiating a mutual recognition arrangement of the respective AEO programmes.

Article 6.11: Protection of Information

1. Each Party shall ensure that confidential information collected pursuant to this Chapter is used only for purposes related to the administration or enforcement of customs matters.

2. A Party shall maintain the confidentiality of the information provided by the other Party pursuant to this Chapter and protect it from disclosure that could prejudice the competitive position of the person to whom the information relates. Each Party shall treat a violation of confidentiality in accordance with its law.

3. A Party shall not disclose the information referred to in paragraph 2 without the specific permission of the other Party, except as required for the purposes of administering or enforcing customs-related laws and regulations, in which case the disclosing Party shall notify the other Party in advance of this disclosure.

4. A Party shall promptly notify the other Party of any unauthorised use or disclosure of information received pursuant to this Chapter and shall provide details of this unauthorised use or disclosure.  In the event of such an occurrence the Party responsible for the safeguarding of the information shall:

• (a) take the necessary steps to address the incident;
• (b) notify the Party whose information was compromised of the measures that were taken to correct the breach; and
• (c) take all reasonable steps necessary to prevent a re-occurrence.

5. A Party shall not provide to the other Party certain information pursuant to this Chapter, including:

• (a) information provided in confidence by another government;
• (b) confidential scientific or technical information provided by a third party;
• (c) information subject to solicitor/client privilege;
• (d) information the disclosure of which is prohibited by a treaty or convention;
• (e) information that will compromise an ongoing investigation; or
• (f) personal data concerning an identified or identifiable natural person.

Article 6.12: Cooperation

1. The Parties shall continue to cooperate in international forums, such as the World Customs Organization, to achieve mutually recognised goals, such as those set out in the World Customs Organization’s SAFE Framework of Standards to Secure and Facilitate Global Trade and the International Convention on the Simplification and Harmonization of Customs Procedures (as amended).

2. The Parties recognise that technical cooperation between the Parties in customs matters under mutually agreed terms, including scope, timing and cost of cooperative measures is fundamental to facilitating compliance with the obligations set forth in this Agreement and for reaching a better degree of trade facilitation.

3. The Parties shall continue to cooperate in accordance with the Agreement on Mutual Assistance in Customs Matters.

Article 6.13: Future Work Programme

1. In order to identify other measures for facilitating trade under this Agreement, the Parties shall, as appropriate, identify and submit new measures for consideration by the Working Group on Rules of Origin and Other Customs-Related Market Access Issues.

2. The Parties shall regularly review relevant international initiatives on trade facilitation, including the Compendium of Trade Facilitation Recommendations, developed by the United Nations Conference on Trade and Development and the United Nations Economic Commission for Europe, to identify areas where further joint action would facilitate trade between the Parties and promote shared multilateral objectives.