Area of Law: Insurance Law
Answer # 2795
Carnet Bonds / Merchandise PassportsRegion: Ontario Answer # 2795
What are Carnet Bonds (Merchandise Passports)?
A Carnet Bond, or ATA Carnet Bond, is often referred to as a Merchandise Passport.
ATA is a French and English acronym of Admission Temporaire/Temporary Admission. An ATA Carnet Bond is an internationally-recognized customs document that permits the duty-free and tax-free importation of goods into foreign countries. The goods covered by the bond must not be sold, given away or otherwise disposed of while in the foreign country.
How does a Carnet Bond work?
An ATA Carnet Bond covers the duties and taxes should the holder of the bond not be able to meet up to their obligations. It is often used by business owners needing to store their imported merchandise or equipment in a customs bonded warehouse. The bond provides security to protect the business owner from having to pay duties and taxes before they are ready to pay such fees
ATA Carnet Bonds are required at the border for entry and exit of every nation that accepts them. A record of the goods brought in and out is maintained by the customs department. No other additional documentation is required for a period of one year.
What products can use a Carnet Bond?
ATA Carnet Bonds can be used for most goods that are temporarily imported and fall under any of the three following general categories:
- Professional equipment (e.g. cameras and music systems used for shooting a movie or ads, theatrical costumes, and surgical instruments);
- Commercial goods; and
- Exhibition, trade show, and presentation goods.
Consumable items that will be used or distributed while in the foreign country, such as brochures, cleaning materials or feed for horses, are not eligible.
Features and benefits of a Carnet Bond
- Easy to apply for
- Bond is good for one year
- Takes care of taxes, temporary importation bonds, and duties
Which countries accept Carnet Bonds?
The majority of countries that Canada does business with accept ATA Carnet Bonds. New countries join the list every year.
For more information and a list of countries currently accepting Carnet Bonds, or to purchase a bond, visit Ai Surety Bonding.
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