Gavel and Scales of JusticeAn ascertained forefeiture is a monetary penalty levied by the Canada Border Services Agency (“CBSA”) when a CBSA officer believes on reasonable grounds that a person has imported goods into Canada illegally (or without reporting the goods). An ascertained forfeiture occurs when the goods cannot actually be seized (because the good cannot be located or seizing the good is impracticable).

I am often asked “What steps do the CBSA take when making an ascertained forefeiture?”  I was recently reminded of Justice Morris Fish’s words in a Supreme Court of Canada decision (Martineau v Canada (Minister of National Revenue), 2004 SCC 81 at paragraphs 41-44):

“41. First, under s. 124 of the [Customs Act], a customs officer must have reasonable grounds to believe that a provision of the [Customs Act] has been contravened.  Once this precondition has been met, and once it has been established that it would be difficult to seize the goods and conveyances related to the customs offence, the officer may demand that the offender pay an amount of money equal to the value of the goods.

42. Second, the person to whom a notice of ascertained forfeiture applies has 90 days to ask the Minister to review the customs officer’s decision (s. 129(1)(d) of the [Customs Act]).  The Minister then serves notice of the reasons in support of the imposed sanction (s. 130(1) of the [Customs Act]).  Within 30 days after notice of the reasons is served, the alleged offender may make submissions and give evidence, in writing, to the Minister (ss. 130(2) and 130(3) of the [Customs Act]).

43. Third, the Minister decides whether the ascertained forfeiture is valid (s. 131 of the [Customs Act]).  This decision “is not subject to review or to be . . . otherwise dealt with except to the extent and in the manner provided by subsection 135(1)” (s. 131(3) of the [Customs Act]).

44. Fourth, and finally, the person who requested the Minister’s decision may, within 90 days after being notified of the decision, appeal by way of an action in the Federal Court (s. 135(1) of the [Customs Act]).”

I could not have summarized it better.

Justice Fish goes on to explain what are the ramifications of an ascertained forefeiture:

“45. This process thus has little in common with penal proceedings.  No one is charged in the context of an ascertained forfeiture.  No information is laid against anyone.  No one is arrested.  No one is summoned to appear before a court of criminal jurisdiction.  No criminal record will result from the proceedings.  At worst, once the administrative proceeding is complete and all appeals are exhausted, if the notice of ascertained forfeiture is upheld and the person liable to pay still refuses to do so, he or she risks being forced to pay by way of a civil action.”

Justice Fish recently retired from the Supreme Court of Canada.  I like the simplicity of his words.