Export Controls Handbook
E. Export Permit Application Process
Exporters are encouraged to apply as early in the export process as possible in order to avoid unnecessary delays to shipment schedules. Please refer to section F.1 for processing times.
The first and most important step is to have a complete understanding of the export. What is the product? Where is it going? Who are the intermediate and final consignees who will receive the shipment, and what are the exporter's contractual obligations for shipping the export controlled goods or technology? For what will the exported goods or technology be used, and by whom? The applicant must be able to answer all of these questions in detail before filling in the application.
E.1. Confidentiality of Information
Foreign Affairs, Trade and Development Canada is committed to respecting the privacy rights of individuals, including safeguarding the confidentiality of information provided by companies and individuals.
Regardless of the method of application, the name and business contact information (such as address, e-mail and telephone number) are required for both the exporter and the consignee(s). The data is collected and used for the following purposes: evaluating and approving applications for export permits for controlled goods; tracking goods exported against authorized permits; and supporting other export processes such as delivery verification.
Depending on the nature and destination of the export commodities, consultations with other government departments may be required as part of the export permit approval process (such as the Department of National Defence, Canadian Nuclear Safety Commission, etc.). The data are not used for any secondary purpose (e.g. to create profiles, marketing, or follow-up research/survey).
All the information collected is retained for a minimum of 2 years after the last administrative use, is stored within the program records of the Export Controls Division, and is noted under the Personal Information Bank: Export Import Controls.
Personal information is protected from disclosure to unauthorized persons and/or agencies pursuant to the provisions of the Privacy Act. While third-party commercial information may be subject to requests under the Access to Information Act, no information contained in an export permit application may be released without first consulting with the applicant.
E.2. Export Controls On-Line (EXCOL)
EXCOL is an internet-based system which allows applicants to apply for export control documents electronically. EXCOL is offered through the Government of Canada's Secure Channel and assures client security and privacy for all on-line interactions. Users obtain their own, unique, Government of Canada Access Key, which allows them to access the system through a web browser.
EXCOL applicants are either “Recognized” or “Non Recognized”. By default, users are Non Recognized and may apply for Export Permits, International Import Certificates, and Delivery Verification Certificates on-line, as well as attach electronic copies of required supporting documents to their applications.
Applicants who apply or have applied for more than one export permit annually are advised to become Recognized Users of EXCOL. In addition to the functions available to Non-Recognized Users, Recognized Users may also do the following on-line:
- save partially completed applications and finish them later;
- copy previously submitted applications, modify them, and submit them as new;
- request permit amendments;
- verify status of all submitted applications;
- download and print issued permits and certificates; and
- submit utilization reports.
E.2.1. EXCOL System Requirements
The following are current local system requirements to use EXCOL:
- Internet browsers: Internet Explorer 5.5, 6.0, 6.1, or 7.0; or Netscape 7.02 or 8.0 International.
- Operating systems: Microsoft Windows NT 4 SP4 and higher; 2000 Professional SP3 Millennium edition; XP Home edition or XP Professional edition; or Macintosh OS 8.6, 9.x or OSX in OS9 emulation. MS Vista is not currently supported.
In order to support the Access Key login via Secure Channel, a small Java applet must be installed on the PC and your system will need Sun Java Runtime Environment v. 1.4.2_01 or higher (download from Java website). The download is normally automatic unless some setting prevents the download.
E.2.2. EXCOL Registration
Although it is not obligatory, export permit applicants are encouraged to become Recognized Users of EXCOL. This section explains several easy steps to do this.
Recognized User privileges require registration of the exporting company and of each individual representative of the company who will access EXCOL. There are two forms: the Application for an EXCOL Recognized Business and the Application for an EXCOL Recognized Individual. These forms are available for printing from the EXCOL section of the website.
The information provided in the Recognized Business form is used to create an account within EXCOL for the corporate entity. Each business then designates individual Recognized Users who will be able to access this information and use EXCOL on behalf of the corporate entity.
A Recognized User form must be submitted for each and every person who needs access to EXCOL on behalf of the Recognized Business, even if there is only one individual from the business who will use EXCOL. Each individual must sign the Recognized User form and thereby attest that (a) he or she understands the rules regarding the Access Code and electronic submissions, and (b) he or she consents to the collection, retention and sharing of the personal information required for the EXCOL account.
Deletions and additions of Recognized Users can be requested in writing at any time.
Steps for EXCOL registration:
- Fill in the Recognized Businessform and Recognized User form and send them by fax to 613-992-9397, post or courier to: EXCOL Registration, Administration and Technology Services Division (TIA), Foreign Affairs, Trade and Development Canada, 125 Sussex Drive, Ottawa, Ontario, K1A 0G2.
- Each individual must create a unique Access Key. To do this, users may access the EXCOL website, choose “Login now”, and then follow instructions to “Register for an Access Key.”
- Following receipt by Foreign Affairs, Trade and Development Canada of the forms described in step 1, each Recognized Individual receives an e-mail from firstname.lastname@example.org containing an Access Code, the individual's own e-mail address, and a hyperlink for completing enrolment on-line. By following the hyperlink, each user completes the registration process (users need to enter their Access Key at this step).
- EXCOL then launches and the user's name appears in the upper left corner. For all subsequent logins, users simply go to the EXCOL website and login using their Access Key.
E.2.3. On-line Applications for Export Permits
- Access the EXCOL website and choose the language of your choice.
- Recognized Users choose “Login now” from the left-hand menu.
- Under the heading “Apply for…” on the left-hand menu, select the type of application:
For exports of complete firearms or their receiver/frames (but not for other firearm parts, accessories, or ammunition):
- on the left-hand menu under the heading “Apply for …” select Firearms.
For all other goods and technology (apart from logs and woodchips), including firearm parts, accessories, or ammunition:
- on the left-hand menu under the heading “Apply for …”, select Other Controlled Goods
Two applications are required if firearms and other firearm parts, accessories, or ammunition are being exported together. At the time of writing, a consolidatedEXCOLapplication form for firearms, firearms-related components, and ammunition is under development.
- Read and accept the Privacy Disclaimer.
- Complete the form (see below for detailed instructions for export permit applications). Please provide your Business Number with your first export permit application.
- Attach all supporting documentation electronically. All paper documents should be scanned and saved in .pdf or .jpg formats. If it is impossible to attach electronic documents, you must indicate on the export permit application that they will be sent by fax to 613-996-9933 or by mail to: Export Controls Division (TIE), Foreign Affairs, Trade and Development Canada, 125 Sussex Drive, Ottawa, Ontario, K1A 0G2.
Once you have submitted your application, the system will automatically generate a reference number (Ref. ID). Please quote the Ref. IDon all correspondence regarding your export permit application.
If you have technical difficulties using the EXCOL system, please contact EXCOL Help at 1-877-808-8838 or via e-mail to: excol-ceed.TIA@international.gc.ca.
E.2.4. Paper Applications for Export Permits
Data entry of all paper applications may delay the processing time for export permit applications. Required forms may be downloaded from the Export Controls Division website (on the EXCOL information page) or may be requested from the Export Controls Division at telephone number 613-996-2387.
Forms that are not legible may be returned without action.
For exports of complete firearms or their receiver/frames (but not for other firearm parts, accessories, or ammunition):
- fill in forms EXT-1042 (General Information Form) - (PDF*, 92 KB) and EXT-1042-2 (Firearms Application) - (PDF*, 115 KB)
For all other goods and technology (apart from logs and woodchips), including firearm parts, accessories, or ammunition:
- fill in forms EXT-1042 (General Information Form) - (PDF*, 92 KB) and EXT-1042-1 (Controlled Goods Detail Form) - (PDF*, 96 KB)
Two applications are required if firearms and other firearm parts, accessories, or ammunition are being exported together.
Export permit applications should be sent, with all supporting documents, by fax to 613-996-9933 or by mail to: Export Controls Division (TIE), Foreign Affairs, Trade and Development Canada, 125 Sussex Drive, Ottawa, Ontario, K1A 0G2.
E.3. How to Complete the Application to Export
The following section describes the content that is required in each field of the export permit application, either in EXCOL or on paper forms.
Applicants should bear in mind that an export permit and all documentation submitted with it are legally binding on all parties once an export permit is issued. The Export and Import Permits Actprohibits the “export or transfer, or attempt to export or transfer, any goods or technology included in an Export Control List or any goods or technology to any country included in an Area Control List except under the authority of and in accordance with an export permit issued under this Act.” (Section 13) Furthermore, the Export and Import Permits Act states that, “No person shall willfully furnish any false or misleading information or knowingly make any misrepresentation in any application for a permit … or for the purpose of procuring its issue or grant or in connection with any subsequent use of the permit … or the exportation … of goods or technology to which it relates.” (Section 17).
Incomplete export permit applications may be returned without action by the Export Controls Division. Information entered on the export permit application must be consistent with information entered on the Export Declaration (or other export reporting documents) submitted to the Canada Border Services Agencywhen the goods or technology are presented for export, otherwise the goods or technology may be detained.
E.3.1. EXCOL Field: Applicant information
The Client Name is the name of the business or individual acting as Applicant.
Section 7 of the Export and Import Permits Act requires that the Applicant be a resident of Canada (defined as “…in the case of a natural person, a person who ordinarily resides in Canada and, in the case of a corporation, a corporation having its head office in Canada or operating a branch office in Canada”).
The Applicantand Exporterdo not need to be identical.
If the Applicant is a business, the Applicant must hold a resident Business Number(formerly known as a GST Number) issued by the Canada Revenue Agency (more information on Canada Revenue Agency website). A Business Number is not necessary for an application by an individual. The Applicant must hold aEIPA Number issued by Foreign Affairs, Trade and Development Canada (application forms are available on Export and Import Controls) before the export permit application can be processed. However, export permit applications submitted through EXCOL by businesses that do not already have an EIPA Number will be assigned one upon receipt of the export permit application by Foreign Affairs, Trade and Development Canada.
Please note that Canadian telephone numbers should be separated by a dash (e.g., 613-996-2387).
E.3.2. EXCOL Field: Exporter information
The Client Name provided must be the Exporter, the business or individual which exports the goods or technology or has the legal right to cause them to be exported. The wording “cause them to be exported” does not mean the person involved in the transportation (carriage) of the goods. For more information, please consult the publication “Exporting Goods from Canada, A Handy Guide for Exporters”, available on Canada Boarder Services Agency website.
The Exporter address must be the location from which the goods or technology will be shipped at the time of export. The exporter name and address provided must match the exporter information as stated in the Export Declaration (B13A) or other documentation which is presented to customs authorities when the goods are presented for export.
The exporter may be a non-residentof Canada but the applicant must always be a resident of Canada. In the case of a non-resident exporter, the applicant accepts legal responsibility for the use of the export permit if issued.
If the Exporter is a business, the Exporter must hold a resident or non-resident BusinessNumber (formerly known as a GST Number) issued by the Canada Revenue Agency (more information on Canada Revenue Agency website). A Business Number is not necessary for an exporter who is an individual. The Exporter must hold a EIPA Number issued by Foreign Affairs, Trade and Development Canada (application forms available on our website) before the application can be processed. However, applications submitted throughEXCOL by businesses that do not have anEIPA Number will be assigned one upon receipt of the application in the Export Controls Division.
E.3.3. EXCOL Field: Consignee information
Foreign parties (individuals, companies or other entities) that must be identified in an export permit application typically fall into the following categories:
Information on other foreign parties involved in the export, if any, such as freight forwarders and financial institutions, may be provided by the applicant, or requested in certain circumstances by the Export Controls Division, but does not usually appear on the export permit.
Accurate and complete information about the foreign parties involved in the export of goods and technology from Canada is essential to the Export Control Division's review of an application. Verification of the legitimacy of the foreign parties to the transaction is one of the factors used to determine whether the proposed transaction is consistent with Canada's foreign and defence policies.
Such verification is also a responsibility of the applicant. It is expected that Canadian exporters of controlled goods and technology will make appropriate enquiries as to intended end-use of the export and to fully declare this end-use when making an application. Furthermore, suspicious information should also be disclosed in the application (see Box 3: Evaluating Foreign Clients below, for more information). In other words, an exporter should exercise due diligence and know who the foreign parties are, including the end-users.
E.3.3.1. Final Consignee
The term “consignee” refers to the foreign party or parties with whom the Canadian exporter has a contractual obligation to deliver the goods or technology to directly.
In many cases, there are only two parties named in an export contract: the Exporter and the Final Consignee. The Canadian exporter has signed a contract directly with and will deliver the goods or technology to a foreign customer, for their own use. In this case, the customer is the Final Consignee (or “Ultimate Consignee” on documents such as the Export Declaration that are required by the Canada Border Services Agency – see section H).
In cases where the Canadian exporter is carrying or shipping goods or technology to several countries (for example, for demonstrations at trade shows or visits to customers), the location in the first country of destination should be used for the Final Consignee. Other destinations should be described in the Overall Description of Goods and End-Use (see Section E.3.4 below). The Canadian export permit will cover the movement from Canada to the first country of destination and subsequent movements between countries may be subject to foreign export controls.
A “carnet” issued by the Canadian Chamber of Commerce may help facilitate subsequent movements between countries. A carnet is an international customs document used for temporary, duty-free exports (i.e., the exported goods will return to Canada after less than 1 year). It is currently accepted in approximately 75 countries. Items which enter a country under the authority of a carnet are not to be sold. For more information about Canadian carnets, please visit a local Chamber of Commerce.
Applicants may submit permit applications with multiple Final Consignees, provided they are located in the same country.
Furthermore, please note that the term “Intermediary Consignee” is being phased out and will no longer be applied to export permit applications.
Applicants for export permits are required to identify end-users of the goods or technology proposed for export. In general, the end-user is the entity that employs the goods or technology that were exported from Canada for the purpose for which they were intended.
Box 2: Examples of Consignees and End-Users
The following examples may help to distinguish between consignees and end-users in more complex cases.
Consignee re-sells to end-user: A company in the UK wins a contract to supply parachutes to the UK Ministry of Defence. The UK company buys the parachutes from Canada and, according to its contract with the UK company, the Canadian exporter delivers the parachutes to the UK company. The UK company subsequently sells these Canadian parachutes to the Ministry of Defence. In this scenario, the UK company is the consignee and the Ministry of Defence is the end-user.
Canadian exporter delivers to end-user: A company in the UK wins a contract to source parachutes for the UK Ministry of Defence. The UK company buys these parachutes from Canada and contracts with the Canadian exporter to deliver them directly to the UK Ministry of Defence. In this scenario, the Ministry of Defence is both the consignee and the end-user.
Consignee is a manufacturer: A company in the UK that manufactures pilot ejector seats buys parachutes from Canada. The Canadian exporter delivers the parachutes to the UK company. The UK company sells its pilot ejector seats, which include the Canadian parachutes, to a company in France, which installs the ejector seats on an aircraft. The Canadian exporter has no direct relationship with the French company. The UK company is the consignee and the end-user of the goods exported from Canada (the parachutes). The end-use of the Canadian goods is for the production of pilot ejector seats in the UK, for subsequent use by the French company in the assembly of an aircraft; this needs to be fully described in the Canadian export permit application (preferably in a cover letter).
Parts used for repair overseas: A company in Italy buys spare aircraft parts from a Canadian exporter. According to its contract, the exporter ships the goods directly to a company in Portugal which uses the goods to repair an aircraft owned by the Italian company. In this scenario, the consignee is the Portuguese company and the end-user is the company in Italy.
Multiple trade shows: A Canadian exporter intends to participate in trade shows in 3 different countries within a period of 2 months. The first trade show is in Germany, the next one in France and the last in the Netherlands. After that, the goods return to Canada. The Canadian export permit will identify a consignee in Germany only. The Canadian exporter should obtain a carnet from the Canadian Chamber of Commerce to cover the movement of the goods to France and the Netherlands. The details of the full itinerary must be submitted with the permit application including, if possible, a copy of the carnet.
Box 3: Evaluating Foreign Clients
The following questions are meant to assist exporters to evaluate the legitimacy and credibility of foreign customers who wish to acquire export controlled goods or technology. If answers to the following questions raise suspicions about potential foreign customers, exporters should describe the circumstances in their export permit application in the EXCOL field "Overall Description of Goods and End-Use".
- How well do you know the foreign customer? Is it difficult to obtain information about that company or entity?
- Is the customer reluctant to provide an end-use assurance document or is information not forthcoming in comparison to past experiences with other customers? Does the product fit the customer's business profile?
- If you have done business with the customer before, is this a usual request for him/her to make?
- Does the customer seem familiar with the product type and its performance characteristics or is there an obvious lack of technical knowledge?
- Does the customer reject the customary installation, training, or maintenance services provided?
- Is unusual packaging and labelling required?
- Is the shipping route unusual?
- Is the customer ordering an excessive amount of spare parts or other items that are related to the product, but not related to the stated end-use?
- Is the customer offering unusually profitable payment terms, such as a much higher price than normal? Is the customer offering to pay in cash?
- Is the customer or the end-user tied to the military or the defence industry, or to any military or governmental research body?
In many cases, the Consignee is the end-user of an exported good or technology. In other cases, when there are several foreign parties with an interest in a transaction, the end-user may be more difficult to identify.
A foreign manufacturer that uses goods (such as components, assemblies, etc.) or technology to produce or develop new products, or which integrates them into new products, is the end-user of the goods or technology exported from Canada. Subsequently, the new products may be sold by the foreign manufacturer to a third party. The foreign manufacturer may consider the buyers of these new products with Canadian content to be its own end-users.
In cases where the Consignee resells or distributes the goods or technology (in their original form, as they were exported from Canada), the Consignee is not considered to be the end-user. In this case, the end-user would be the third party who will acquire the goods or technology.
In the case of repairs, the entity which owns the goods that are being repaired is typically the end-user.
If the roles of the parties are uncertain, applicants should provide sufficient information about the transaction for the Export Controls Division to make a determination, including copies of contracts and invoices.
End-use statements are an essential part of export permit applications. More information about end-use statements can be found in section E.4.2 below.
E.3.3.3. Other information about consignees
For the purpose of export permit applications, all consignees are located outside Canada. Export permit applications that list a Canadian consignee address cannot be processed and will be returned without action.
Consignee addresses should identify the location of the consignees where they take physical possession of the exported goods or technology. Consignee addresses must be complete. Post office boxes alone are generally not acceptable. Where available, consignee website addresses should be indicated along with contact e-mail addresses.
When entering telephone and fax numbers, applicants should separate country and area codes by using a dash between each set of numbers (e.g., 1-613-996-2387). Applicants should verify all consignee contact information (including telephone and fax numbers, e-mail addresses, and websites). Information that is found to be incomplete or inaccurate may result in the return of the export permit application without action.
E.3.4. EXCOL Field: Overall description of goods and end-use
The exporter should provide general information about the proposed export in this field, including the following (as applicable):
- a description of the goods or technology which is understandable to a layperson;
- a description of the exporter's understanding of the end-use of the exported goods or technology by the consignee and, if known, subsequently by other parties, if different from the description provided in the supporting documents (e.g., end-use statement);
- in the case of temporary exports, such as for repair or for demonstration at a trade show, a detailed explanation of the reason for the export and a statement as to whether the exported goods or technology will remain in the possession of an employee of the exporter while outside Canada;
- in the case of an export for the purpose of marketing or bidding (such as responding to a Request for Proposal) prior to a contract being concluded, supporting documents to this effect must be attached to the application.
Example of how to complete “Overall Description of Goods & End-Use field:
Describe what is being exported to whom and indicate end-use.
E.3.5. EXCOL Field: Applicant/Exporter comments
As illustrated below, in this field the applicant may, if available and desired, include additional comments which are relevant and which may help understand the application, such as:
- in the case of U.S.-origin goods, a declaration of the U.S. authority under which the goods and/or their subcomponents or technology, were imported into Canada. If controlled under the International Traffic in Arms Regulations, under what authority are the goods, subcomponents or technology being re-exported from Canada;
- shipping date when the export is expected to leave Canada, if known;
- requests for extended permit validity (see section E.5 for general guidelines on permit validity);
- justification for urgent requests;
- where multiple parties are involved in the transaction, provide details regarding contractual obligations. The role of the consignee should be specified; and
- information about the rate of exchange used to convert item value to Canadian dollars (see Box 7 concerning currency fluctuation) if supporting documents reflect sales that are not denominated in Canadian dollars.
Add pertinent or special information, for example:
- cite ITAR exemptions
- note details on the role of an intermediary
- justification for urgent request
The Applicant may also provide a cover letter to include other relevant information in order for the Export Controls Division to fully understand and assess the transaction and the proposed export. Such information may alternatively be provided in a separate cover letter attached to the completed export permit application.
E.3.6 EXCOL Field: Export type
Indicate the type of export, whether permanent (the goods will be exported and are not intended to return to Canada) or temporary (the goods will be exported and are intended to return to Canada after a period of time).
E.3.6.1. Permits for Temporary Exports
Permits for temporary exports are common for controlled items exported for trade shows, exhibitions, demonstrations, provision of services, repair by the original manufacturer, and other activities after which the items will be returned to Canada. Exporters must apply for an export permit in the normal manner and must note in the body of the application that they are asking for a permit for a temporary export. In granting an export permit for a temporary export, the Export Controls Division may place certain conditions on the export. These conditions may include:
- adhering to the expiry date of the export permit (normally 12 months);
- ensuring the items are properly supervised while abroad; and
- submitting proof that the items were returned to Canada unchanged (except as otherwise authorized by the export permit).
Box 4: Applications to Export Goods Temporarily (including for Repairs, Upgrades, and to Loan Equipment)
In cases where equipment is being temporarily returned to the manufacturer or a foreign client for repair, maintenance upgrade or on loan, the value on the permit application should be stated in Canadian dollars as the normal commercial value of the goods or technology being exported.
For clarity, the Item Description of each good that is being temporarily exported should contain the following: “(to be repaired.)”, “(to be upgraded)”, or “(on loan)”.
Examples as they might be displayed on an export permit:
|Item No.||Item Description||Quantity||Unit Value||Total Value|
(to be repaired)
|2||Utopia display unit |
(to be upgraded)
|3||XYZ amplifier |
Model number ABC
E.3.7 EXCOL Field: Description
The Description is how the goods or technology will be identified on the export permit, which will also be verified against the Export Declaration submitted to the Canada Border Services Agency at the time of export (see section H).
Provide the name of the goods and include, where possible, models, brand names, part numbers, serial numbers, and so on. This information should be consistent with the Export Declaration, submitted to the Canada Border Services Agency. Where quantity is given as a weight or volume, the unit of measure must be stated in the Description field.
Do not describe the purpose, use, or physical appearance of the product; this should be provided instead in the field “Overall Description of Goods and End-Use” (see section E.3.4). Do not include references to the Export Control List (self-assessments should be provided in the field “ECL No.”, section E.3.14).
When exporting complete systems or items such as aircraft, aircraft simulator or vehicle, the same approach may be taken. A single item line may be used to describe the item, for example, “Ford 2001, F-350 Super Duty Truck”. However, if the item will be disassembled for shipment into several major components, these components this should be clearly reflected in the line item description. For example, a disassembled car might be described as follows: “disassembled Ford 2001, F-350 Super Duty Truck, components include 5.4 L V8 engine block, Chassis, body”.
When exporting spare parts for a complex item, exporters should use several lines to reflect the main systems. For example, a helicopter might be broken down by the following systems: Fuselage, Wings, Flight Controls, Avionics, Engines, Hydraulics system. Each description line item should include a high level list of the types of items that would be exported under each of these systems. “Lot” values may be used instead of specific quantities when grouping these types of exports.
Example of how to complete line item description in EXCOL:
Enter Item name, identifying number (optional context line - must be concise
Self-assess against Export Control List (see section C) or add "ACL" where goods are going Area Control List destination
A kit is a collection of goods that are sold together as a defined product (as opposed to a collection of spare parts put together for a specific customer).
When exporting "Kits" that contain a mixture of articles, the description line should include the kit name, a high level list of the items which are included in the kit, and an identifying number if available. For example:
E.3.7.2. Product Components
Similarly, when exporting spare parts for a product, the description line should include a list of the types of components that will be exported and the name of the final product for which they are intended (see line 2 in the image example. Line 2 provides a high level list of the ECL controlled components of night vision which may be shipped as spares.).
Export controls apply to both physical shipments of controlled goods and technology and to transfers of controlled technology by intangible means. As illustrated below, Item descriptions for intangible exports need to describe the goods or technology being exported and provide information about the method of transfer (see also Box 5 – Exports by Intangible Means)
Lot may be used instead of quatity as it may be diffilcult to quantify the export technology
Box 5: Exports by Intangible Means
Certain types of products lend themselves to exportation by intangible means, such as: software and source code, services, and other technology. Exports by intangible means may occur by way of, for example:
- provision of services or training
- downloads or other electronic file transfers
- telephone conversations
- face-to-face meetings
How to apply for export permits for exports by intangible means
Transfers by intangible means of technology that is subject to export controls must be authorized by an export permit. When applying for export permits which include exports of controlled technology by intangible means, the applicant should enter the product that will be exported by intangible means on a separate line on the export permit application. The export permit application line description for items which will be exported or transferred by intangible means should include the following elements:
- What is it? e.g., what is the brand and product name?; is it technical data, technical assistance, information, etc.? – usually a brief description is necessary in this field.
- What is the purpose of the export or transfer of technology? e.g., for the development or production or use of a product or article which is controlled for export on the Export Control List? What is the name of the project under development for which purpose the technology will be exported?
- In what form will the technology be exported? e.g.:
- Technical data: blueprints, formulae, plans, models, engineering designs and specifications, manuals, instructions, etc.
- Technical assistance: instruction, skills development, working knowledge, consulting services, training, etc.
- Software (you should clearly define the item being exported): executable code, source code, etc. (see section E.3.13 for other examples)
- Services: such as training, consulting, troubleshooting, or instruction –
- exports of services by intangible means are often linked to physical goods exports, however transfers by intangible means should be covered on a separate export permit application line.
- How will the product be exported? e.g., electronic file transfers, fax, in-situ training seminars, “help desk” advice, telephone discussions or negotiations?
Line item descriptions should not contain Export Control List numbers or make reference to documents or statements attached or mentioned elsewhere. The line item description entered on the export permit application should stand alone as a description of the export by intangible means, identifying the item being exported or transferred.
Line item descriptions allow the establishment of clear and appropriate parameters which effectively define the proposed export or transfer and support its monitoring. A proper line description avoids potential confusion for all parties involved in the transfer/export process.
Fictional examples of acceptable item descriptions would be:
- Operation and maintenance manuals and diagrams for the use of X35 Transmitters in the Acme military communications satellite program to be exported by downloads from a secure website.
- Technical and engineering services and manuals for overhaul of the N40 jet engine to be directly provided by exporter's employees.
- Source code sharing for international co-development of ABC operating system.
- Executable software upgrade downloads for previously exported training simulators, model XYZ (originally exported under export permit number xxx).
Due to the nature of technology and the ability to export it in different forms (e.g., in a physical form or by electronic means), exporters are advised to request quantities as “lots” when applying for an export permit. Total value entered on such applications should reflect the total value of the supply contract over the life of the export permit. In some cases, a condition of using the export permit may be that reports of actual shipments of the products authorized for export must be submitted at regular intervals. In cases where the quantity measure is a lot, exporters may report a share of the total value of the lot exported in the relevant period.
Compliance and records
Exporters of controlled goods and technology are obliged by law to maintain for a period of six years all records with respect to exports made under the authority of export permits issued under theEIPA. This record-keeping obligation applies equally to exports by intangible means.
The export control function has historically been carried out by a company's shipping department. However, in the modern environment of electronic communications and globalized technology development – an environment in which exports of controlled technology can take place from the desktop of an employee – responsible exporters should ensure that all business units conform to enterprise-wide policies and procedures on export controls compliance.
E.3.8. EXCOL Field: Item Type (including quantity and value)
Select one item type: quantity, lot or no commercial value and provide the corresponding information for the selection.
If a unit of measure is used, it should be stated in the item Description. This typically occurs in the case of bulk shipments. For example, to describe an export of 10 litres of milk, the applicant would state "10" in the quantity field and include a description of: "Milk (quantity stated in litres)".
Box 6: Applications to Permanently Export Goods After Temporary Import into Canada (including Exports After Repairs and Returns of Equipment on Loan)
When applying to permanently export goods that have been temporarily imported into Canada and are being returned to a foreign client, the value of each line item should reflect only the cost of new revenue generated due to the transaction, as paid for by the customer. This amount, in Canadian dollars, is entered in the Unit Value field inEXCOLor on the paper forms.
With respect to repairs, if the cost of repairs is unknown at the time of the export permit application, a high estimate may be entered to ensure that the actual value of repairs which is declared on customs documents at the time of export does not exceed the value stated on the export permit.
The repair value should be zero in the case of repairs made under warranty, which result in no new revenue for the exporter; applicants for such permits may choose the “No commercial value” option in theEXCOLDescription field in order to obtain a dollar value of zero.
Similarly, in cases where loaned or leased equipment is being returned to a foreign consignee (that is, the owner of the goods) and does not result in any new revenue for the Canadian business, the Unit Value should be reported as zero.
For clarity, the Item Description of each good that is being returned should contain the following: “(Repair value stated.)” or “(Warranty repair.)” or “(Return of loaned equipment.)”. Furthermore, the Item Description field should include the value that would be charged for the export of each unit of the good if it were new (i.e. the normal sale price or normal commercial value).
Examples as they might be displayed on an export permit:
|Item No.||Item Description||Quantity||Unit Value||Total Value|
|1||X35 microprocessor, P/N 12345|
(Warranty repair. Normal commercial value is $560 per unit.)
|2||Utopia display unit, Model AZP-02|
(Repair value stated. Normal commercial value is $2,000 per unit)
|3||Amplifier, Model NEW-03|
(Return of loaned equipment. Normal commercial value is $1,000 per unit.)
Return of non-conformingor discrepant goods to a supplier is not treated in the same manner. The Item Description field should indicate the full value of the goods being returned as per the example below.
|Item No.||Item Description||Quantity||Unit Value||Total Value|
(return of non-conforming good to supplier)
“No Commercial Value” is used when there is a positive quantity but a dollar value of zero (used, for example, when goods are being exported under warranty; see Box 6 for more information).
“Lot”should be chosen when the goods described on a single line cannot be easily quantified but they have a positive dollar value for the purpose of the application. Lots are frequently used when a line describes miscellaneous spare parts for a complete product that is identified on another line of the same application; lots are also commonly used with exports of information that may be transferred in different intangible forms (such as in meetings and electronic downloads).
If repairs are anticipated over the duration of the permit, Exporters may add additional lines to cover those potential repairs on their initial permit application.
The example below illustrates how to structure a permit to cover anticipated repairs. In this example, the applicant has requested to export 100 widgets. Based on historical sales, the exporter estimates that for every 100 widgets sold, 25% of the units will be shipped back for repair. Line 2 reflects the number of goods to be repaired under warranty. If a warranty plan will not cover all repairs, a third line item can be added to cover anticipated repairs with a fee. By using this approach, exporters do not have to apply for a new permit if their product is returned for repair during the validity period of their permit.
Value must be expressed in Canadian dollars and should represent the invoice or sale price paid by the foreign customer (see Box 7 below on how to account for exchange rate fluctuations if the sale price is denominated in another currency). If the exact unit value is not known at the time that the application is submitted, it should be estimated. Exporters should ensure that the actual value that will be declared at the time of export does not exceed the estimate declared on the export permit.
For permanent exports of new goods or technology, the value should reflect the full sale price.
For permanent exports of goods repaired in Canada, the value should reflect only the cost of repairs in Canada (see Box 6: Applications to Export Goods Repaired in Canada).
The value of temporary exportsfrom Canada should be declared as the normal commercial value of the goods or technology being exported.
Exports which exceed those defined on the export permit in value or quantity may constitute a violation of the Export and Import Permits Act. If the value of goods or technology increases between the time the application was made and the date of export, a Permit Amendment Request should be submitted to change the permit prior to shipment.
Box 7 : Exchange Rate Fluctuations
The value of an export authorized by an export permit may not exceed the value stated on the permit. Since this value is stated in Canadian dollars, when sales are denominated in another currency, exchange rate changes may cause the value of the export to exceed the value stated on the permit, even though the goods or technology being exported are otherwise as described on the permit.
This problem may be more acute in the case of permits that are valid for several years. This problem is particularly important when exporters are required to submit periodic reports of exports made under the authority of a permit (see for example section G.2.1 below).
To avoid this problem, applicants are encouraged to use an estimated rate of exchange (up to 15% above the actual rate) that offsets potential currency fluctuations. The exchange rate used should be identified in the “Exporter/Applicants Comments” field of the permit application (for example, "Sales are made in US dollars. Exchange rate used here is $1.35 Canadian = $1 US").
When the exchange rate fluctuates outside this range, exporters must submit a Permit Amendment Request to change the unit value reflected on the permit prior to shipment in order to ensure that the Canadian dollar value of an export authorized by a permit does not exceed the value stated on the permit. The applicant should attach a statement which notes the exchange rate at the time of the original application and the prevailing exchange rate at the time of the amendment request.
E.3.9. EXCOL Field: U.S. Content
U.S.-origin value is an estimated percentage of the total value in Canadian dollars.
If the goods or technology being exported contain some U.S. content and are controlled in Groups 2 or 6, or by Item 5504 of the Export Control List, refer also to section E.4.3 below.
E.3.10. EXCOL Field: Country of Manufacture
Country where the goods or technology were produced or assembled into their final form prior to export from Canada.
E.3.11. EXCOL Field: Goods are specially designed or modified for
Specify whether the goods are designed or modified for (select one): "military use", "space use", "nuclear use", "other (specify)". Appropriate supporting documentation should be attached to the application. Otherwise leave blank.
E.3.12. EXCOL Field: Goods employing cryptography
For information security products, indicate if the goods employ cryptography (including encryption or decryption). Otherwise leave blank.
E.3.13. EXCOL Field: Supplementary information
Optional statements that clarify the nature of the export, such as:
- cryptographic executable code
- cryptographic source code
- complete system
- part of a system
- raw material
- replacement part
- software executable code
- software source code
- substance or compound
- technical data for design or development
- technical data for production
- technical data for repair/overhaul
- test, inspection or production equipment
E.3.14. EXCOL Field: ECL No.
Using the latest version of the Export Control Listas published in the Guide, identify the Export Control List Item number which describes the goods or technology proposed for export. See section C for information on determining the Export Control List Item Number.
E.3.15. EXCOL Field: Additional information attached
Specify any additional, supporting documentation that is attached to the application (you must attach some documents, see section E.4 below.)
E.4. Mandatory Supporting Documentation
Supporting documentation is an important part of the application. Exporters must submit at least one technical document and end-use assurance document to supplement the completed export permit application form. Additional documents (such as cover letters or sales orders or contracts) may be added to further support the export request.
Electronic documents (including scans of paper copies) should be attached to export permit applications made on-line using theEXCOLsystem. As indicated in the example on the next page, Applicants are requested to separate different documents for ease of reference at different stages of the review process.
E.4.1. Technical description of the goods or technology
The Export Controls Division undertakes a technical assessment of the goods, services, and technology listed in the export permit application to determine under which Export Control List Item(s) they fall. For this purpose, technical specifications of the export must be detailed and adequately describe the characteristics of the goods, services and technology. Enough details must be provided to establish the true nature of the items. These could be provided in the form of drawings, data sheets, manuals, component lists, block diagrams, exploded view drawings, and so on. Marketing brochures may also provide useful additional information. The information that is submitted should make clear the type and function of the goods and provide key technical parameters.
Failure to provide technical specifications for the items may delay the processing of your export permit application or result in it being returned to you without action.
Example of how to list supporting documents in EXCOL:
Mandatory Supporting Documents:
- Technical Specifications
- End-Use Assurance
- US Export Authorization (where applicable)
Optional Supporting Documents such as:
- Cover letter
- Letters of credit
E.4.2. End-Use Assurances
There are several types of end-use assurance documents. The provision of end-use assurances does not in any way imply that an export permit will be issued. All export permit applications are considered on a case-by-case basis and on their own merits.
Exporters must submit at least one end-use assurance document with their export permit application and are encouraged to include several such documents, as available. This will ensure that the Export Controls Division has a clear understanding of the proposed export and will help to expedite the review process.
E.4.2.1. End-Use Certificates
An End-Use Certificate is issued by the government of the final destination country and is attached to the Canadian export permit application. An End-Use Certificate:
- identifies the quantity and value of the goods or technology that will be exported from Canada to that country;
- describes the end-use of the items in that country;
- confirms that the government of that country accepts responsibility to ensure that the items will not be diverted to uses other than those stated; and
- dated with signature.
E.4.2.2. End-Use Statements
If an official document from the final destination government is not available, an End-Use Statement from the final consignee is generally acceptable (see Box 2 in section E.3.3 above for more information on consignees and end-users).
In certain cases, the applicant may be requested to provide a statement or statements from parties other than the final consignee (e.g., in certain cases when the final consignee is not the end-user).
An End-Use Statement must be dated (preferably within 6 months of the time when the export permit application is submitted) and written on company letterhead in either English or French and should:
- Identify the items, including quantities, which are the subject of the export permit application;
- Identify the end-user and the location where the items will be delivered;
- Identify any consignees, agents, or other entities involved in the export from Canada;
- State the purpose and end-use of the products, including a statement of whether the intended end-use of the items is civilian (commercial) or military;
- State whether or not the goods or technology are intended for re-sale, re-transfer or re-export to another party or parties and, if so, describe the circumstances; or state that the goods or technology will not be resold, re-transferred or re-exported;
- Declare whether or not the goods and technology will be used for any purpose associated with the development or production of chemical, biological or nuclear weapons, or their delivery systems (such as missiles);
- State that the goods or technology will not be transhipped to other destinations or otherwise diverted from what has been previously described; and
- Identify the name and title of the person signing the End-Use Statement, his/her address, telephone number, fax number, e-mail address and corporate website.
E.4.2.3. International Import Certificates
An International Import Certificate is provided to the exporter by the final consignee and is issued to the final consignee by the government of the final destination country. It states the items (including quantities and values) which will be imported and provides both governments with an assurance that the goods will not be diverted to illegitimate end-users. The Canadian exporter must attach the International Import Certificate to the export permit application and submit it to the Export Controls Division within the validity period (usually 6 months) of the International Import Certificate.
E.4.2.4. Import Licenses
Import Licenses are issued by the government of the final destination country when imports of the items proposed for export from Canada are controlled. If an Import License is required, the final consignee must obtain it and provide a copy to the Canadian exporter, who must then attach the copy of the Import License to the export permit application.
E.4.2.5. Informal End-Use Assurance Documents
Applicants are encouraged to attach the documents described below to their export permit applications, in addition to formal end-use assurances. These will ensure that the Export Controls Division has a clear understanding of the proposed export and will help to expedite the review process. However, provision of such information is optional unless specified by the Export Controls Division.
- a copy of the contract of sale between the applicant or exporter and the person to whom the applicant or exporter sold the goods for export [i.e., the foreign consignee(s) or end-user(s)].
- a copy of the service contract between the applicant or exporter and the person to whom the exporter will ship goods for the provision of such services (if applicable);
- a copy of the commercial invoice which relates to the export; and
- a copy of a letter of credit or other financial documentation which identifies the Canadian and foreign financial institutions involved in the export.
At the discretion of the Export Controls Division, in some situations, applicants may substitute one or more of the alternative, informal, end-use assurance documents listed below for the formal end-use assurances described above. These informal end-use documents support the applicant's statements about the destination, consignees, and end-use of the goods or technology proposed for export:
- in the case of temporary exports for demonstration and an exhibition: information about the trade show or exhibit (such as a website or marketing brochure) and evidence of registration for display by the exporter or consignee.
- proof of import of goods (such as B3 or CI1 or import waybill) and defect slip or failure report in the case of:
- Canadian-owned items that are being exported from Canada to a foreign country for repair or replacement.
- foreign-owned items which have been repaired or maintained in Canada and are returning to the foreign owner.
- export of replacements or spare parts for service or maintenance (in addition to prior export permit numbers).
- copies of official documents or correspondence originating from other departments and agencies of the Government of Canada or of foreign governments when those agencies are involved in the proposed transaction.
Applicants will need to provide their rationale and/or justification in a cover letter (or under the exporter's comments inEXCOL), in order to have these informal end-use assurance documents taken into consideration by the Export Controls Division.
E.4.2.6. End-Use Assurance for Firearms, Components, Ammunition and Explosives
Export permits for firearms, firearm components and ammunition may not be issued unless the exporter provides an import license or other proof that the items will legally enter the country of destination. To meet the requirements of the Organization of American States' Convention on Firearms, Explosives and Related Material, proof of a transit authorization may be required if the items are transiting a third country.
E.4.2.7. Delivery Verification Certificates
A Delivery Verification Certificate is typically issued to the final consignee by the government of the country to which the item has been exported and provides official confirmation that the goods have been delivered in accordance with the terms of both the Canadian export permit and/or the foreign-issued International Import Certificate. In some cases, Canadian exporters are required to obtain and submit to the Export Controls Division applicable Delivery Verification Certificates as a condition of the export permit.
For information about applying for a Canadian Delivery Verification Certificate (to confirm that items controlled in another country have been imported into Canada), please see section J.3.
E.4.3. U.S. Export Authorization
The Export Permits Regulations require that a U.S. Export Authorization be provided with every application to export goods or technology that are:
- controlled goods that are goods of U.S.-origin,
- goods incorporating any goods of U.S.-origin that are controlled goods, or
- goods manufactured in Canada using any goods of U.S.-origin that are controlled goods.
In this context, the term "controlled goods" is defined in the Defence Production Act to comprise the following items on the Export Control List:
- goods included in Export Control List Item 2-1that are prohibited firearms, as defined in paragraph (c) of the definition “prohibited firearm” in Subsection 84(1) of the Criminal Code;
- goods included in Export Control List Item 2-2;
- goods included in Export Control List Item 2-3 that are ammunition with a calibre greater than 12.7 mm;
- goods included in Export Control List Items 2-4 to 2-22;
- goods included in Export Control List Item 5504;
- all goods listed in Group 6on the Export Control List.
A U.S. Export Authorization means a copy of any of the following approvals issued by the United States (Department of State) under the International Traffic in Arms Regulations (ITAR):
- U.S. Export License;
- Warehouse and Distribution Agreement;
- Technical Assistance Agreement;
- Manufacturing License Agreement;
- Re-export Authorization letter; or
- U.S. Export License Exemption.
In general, goods that are, or that incorporate, goods or technology that were exported from the U.S. under the authority of the U.S. Department of State and the ITAR fall into this category (see Box 1 for related information).
Exports of controlled goods that are not of 100% U.S. origin but contain some U.S. content that is not subject to the ITAR must describe what the U.S. content consists of and explicitly state in the application to export those goods from Canada that this U.S. content is not subject to ITAR. In such cases, a U.S. Export Authorization is not required.
E.5. Export Permit Validity
The validity period of export permits varies depending on the items to be exported and the nature of the transaction. For electronic applications submitted inEXCOL(as illustrated below), Applicants may select a permit expiry date which suits their export requirements and which conforms with the guidelines set out in subsections E.5.1 to E.5.7. Requests for permits which exceed a validity period of 2 years are assessed on a case-by-case basis and are granted at the discretion of the Export Controls Division based on the additional information that should be submitted, as described in E.5.1- E.5.7.
For paper applications, Applicants should state in the “Overall Description of Goods and End-Use” field of the application (see section E.3.4) or in a cover letter if it is known when the export is expected to be completed or if the export permit will be required for a specific duration.
Unless otherwise stated, an export permit may authorize multiple shipments, up to the expiry of the permit and as long as the cumulative total of the quantity or value of items exported does not exceed the quantity or value stated on the permit.
The validity period of export permits may be amended after issuance (see section G.3).
Permits for temporary exports may be valid for up to 2 years.
Permits for permanent exports have validity periods according to the following guidelines.
E.5.1. Group 1
Standard – up to 2 years; up to 5 years upon request and with evidence of a long-term contract.
E.5.2. Group 2
E.5.2.1. Single Shipments
Export Control List Items 2-1 to 2-4 – Single shipment for most items to all destinations.
As a general rule, export permits for military items falling under Export Control List Items 2-1 through 2-4 will be issued only for a single shipment to a single consignee. The export permit becomes invalid after the first shipment is made even if the shipment is only a partial one. Exporters must re-apply for a new export permit to cover any shortfall.
E.5.2.2. Multiple Shipments
Export Control List Items 2-1 to 2-22 – Standard – up to 2 years; up to 5 years upon request and with evidence of a long-term contract.
Applicants should note that permits for permanent exports in this Group may be subject to a quarterly reporting condition (see section G.2.1). Such reports must be made even when there have been no exports in a given quarter.
To reduce the number of unnecessary reports, applicants should state when the exports described in the permit application are expected to be made and request a shorter validity period than 2 years where appropriate.
E.5.3. Group 3
All Group 3 Export Control List Items – up to 5 years.
The exporter must also be in possession of a valid export licence issued by the Canadian Nuclear Safety Commission prior to export.
E.5.4. Group 4
All Group 4 Export Control List Items – up to 5 years.
The exporter must also be in possession of a valid export licence issued by the Canadian Nuclear Safety Commissionprior to export.
E.5.5. Group 5
Export Control List Item 5400 when General Export Permit No. 12 does not apply (see section D.4) – up to 5 years.
Export Control List Item 5504: Standard – up to 2 years; up to 5 years upon request and with evidence of a long-term contract.
E.5.6. Group 6
Export Control List Items 6-1 and 6-2 – Single shipment.
Export Control List Items 6-3 to 6-20: Standard – up to 2 years; up to 5 years upon request and with evidence of a long-term contract.
E.5.7. Group 7
All Group 7 Export Control Items – up to 2 years.
- Date Modified: