UPS Brokerage C.O.D.

[Ninjalific]

So I'm to be recieving models from another trader through UPS, but when they arrived and I wasnt around they left a note demanding $40 for a "Brokerage C.O.D. fee". The seller had no idea about this and was just as uninformed as I was, he paid for his shipping when the models were sent out.

I haven't heard of this with other postal services, and was wondering if other people have heard of this, know what this is about, or are fighting it in any way.

I've searched online and found only plenty of horror stories, and their useless site says their brokerage fee is supposed to free with a capital asterisk.

Any input is appreciated. Is UPS just a bad idea? Or is this normal?

[osloco]

Its unfortunately normal. Its their own build in customs nonsense. I stopped using a while ago after I got a trade that had 40 dollars of models and 40 dollars of UPS brokerage fees. For shipping to Canada I always ask for USPS, you only get hit with customs some of the time. I usually ask for them to mark used as well if they are, not sure if that actually helps or not in the eyes of customs.

[kturock]

UPS is a private company and can create & charge any fees they want at anythime.

Customs fees are taxes collected by the government. I believe what UPS did was it collected what it considers a customs fee, and also a fee for doing the work.

[s_o_r_r_o_w]

1. Please read my tips on shipping to Canada, in my sig.

2. With UPS, you have a couple of options in this situation.

First, if you have a car, you can broker the package yourself. This will involve driving to the customs center (often near the airport) and processing the paperwork yourself. This isn't hard, and may result in nothing other than taxes being paid. It's a PITA, but straight forward.

If you don't want to do that, you can throw a fit on the phone with Customer Service, and they will often cave and "as a one time exception" waive the brokerage fee. Depending on your confidence level, there are various strategies to take on the phone, byt if you escalate up the chain far enough, someone will waive it just to get rid of you.

3. In general, I would never ship from outside Canada with UPS. It's not worth it.

[Ninjalific]

Thanks for the tips, unfortuantely I'm no good at complaining to people, but I may inquire about brokering (?) the package myself, if its not too late or out of the way. All in all a life lesson.

[Redgar]

I wouldn't normally necro a thread of this vintage, but I didn't see any more recent similar topics and I believe I have useful information to append for others who might search for this thread when seeking advice on how to deal with UPS (or FedEx) "Brokerage Fees". I apologize for the wall of text, but I think the background context is important: the shipping company starts with experience, resources, and either your money or your parcel. If you're going to challenge them, it helps if you can demonstrate an understanding of the system.

What's the context?
If you are an 'importer', you must present a declaration to the Canadian Border Services Agency (CBSA) for every parcel of yours entering Canada. The CBSA will then examine your declaration and associated paperwork, make a determination as to the admissibility of your goods, and assess any duties and taxes owing. You then pay said duties and taxes.

Most commercial shipments travel by frieght (ship, truck, air, or rail). In such circumstances, the shipping company has a what is known as bonded warehouse. A parcel arrives in the warehouse. The importer receives a call. The importer attends the warehouse, establishes his/her identity, and receives certain shipping documents from the warehouse. The importer then attends the nearest CBSA office to present this document, his/her invoices and prepared customs declaration form, and any permits or other documents. The CBSA assesses/investigates, and confirms the amount of D's & 'T's to be paid. Once the importer pays, the warehouse documents are stamped with a release stamp. The importer attends the shipping warehouse with a copy of the stamped warehouse document, and the package is released.

This process can be rather intimidating and time-consuming for new importers. Thus, there are 'customs brokers' who act on behalf of importers for a fee. The customs broker collects the necessary information from an importer, prepares the appropriate documentation, deals with CSBA, and eventually presents the importer with the necessary clearance papers. Also, what happens if an importer is at work but wants his/her spouse/child/parent to clear the parcel, or a corporation wants to import goods but doesn't want the principal(s) of the corporation to have to personally clear each shipment that arrives? Individuals are permitted to act as "agents", in certain prescribed circumstances and provided no fees are charged.

The CBSA still wants to make sure that the actual importer can be charged with various offences should the importer provide false or insufficient information via a broker. All agents must, therefore, be specifically authorized by each importer they clear packages for. This is why the Customs Act, R.S.C. 1985 c. 1, (2nd Supp.), states:

10. (1) Subject to the regulations, any person who is duly authorized to do so may transact business under this Act as the agent of another person, but an officer may refuse to transact business with any such person unless that person, on the request of the officer, produces a written authority, in a form approved by the Minister, from the person on whose behalf he is acting.

What's the problem?

Enter USPS, FedEx, and possibly other courier companies. They claim to act as a broker on your behalf. They pay the duties and taxes collected by the CBSA on your parcel, then collect reimbursement from you... along with a potentially-substantial fee. The key question is: did they receive your written prior authorization to act as your importer? If not, then arguably the company is acting in violation of the Customs Act, as they were not 'duly authorized' when they transacted business as your alleged agent. One could also argue they presented false information to CBSA by claiming to act as your agent when they were not.

Why I'm angry

This whole hassle could have been avoided if courier companies properly used the legal framework already in place to facilitate courier transactions. Section 32(4) of the Customs Act allows for the release of "casual goods" (i.e. personal non-commercial shipments) imported by Courier prior to a declaration being filed with CSBA. Where goods are so released, section 32(5) states:

(a) the person who is authorized under paragraph (6)(a) or subsection (7) to account for the goods shall, within the prescribed time, account for the goods in the manner described in paragraph (1)(a) and that person or the importer or owner of the goods shall, within the prescribed time, pay duties on the goods, or
(b) where there is no person authorized under paragraph (6)(a) or subsection (7) to account for the goods, the importer or owner of the goods shall, within the prescribed time, account for the goods in the manner described in paragraph (1)(a) and shall, within the prescribed time, pay duties on the goods.
.

Paragraph 6(a) permits for regulations authorizing persons to account for goods. Regulation SOR/95-418 states:

3. (1) A courier is authorized to account for casual goods released in accordance with subsection 32(4) of the Act in lieu of the importer or owner thereof on condition that... [courier is licenced to do so].

The regulation proceeds to set out accounting requirements.

As I read the above, couriers may be authorized to account for your goods on your behalf and release the goods to you under (a). In terms of actually paying, however: they can pay or you can pay. As I read the above: nothing entitles courier companies to assume that you want them to act as a broker to pay the fees on your behalf, and nothing entitles them to charge you fees for the alleged service. What the couriers should do is provide you the choice: do you want us to take care of paying the fees, or are you going down to CBSA to pay the fees yourself?

What can you do about it?

You always have the option of gritting your teeth, paying the fee along with the D's & T's, collecting your parcel, and using USPS for all future transactions. Sometimes, the $25 just isn't worth the time, hassle, and aggrivation it will cause you righting this particular wrong. That said, this is not my preferred method: I like to right wrongs and make wrongdoers suffer my wrath. (I had a shipment from the US (CCG cards), that was shipped via UPS. Surprise surprise, duties, taxes, and a whomping fee.)

Step One: I grilled the delivery driver on where the authorization came from. Naturally, he couldn't answer (because there was none). I made it unmistakably clear that I was not happy, did not accept that UPS was acting as my agent [because they weren't], and was not going to ultimately pay an exorbitant fee for a service did not want and UPS was not entitled to force upon me. I did choose to accept delivery of the package and pay (via Credit Card) the whole amount requested at the door... on the explicit understanding of the above, that I'd be following up with UPS's brokerage department about their unlawful activity, and that I'd be expecting a prompt reimbursement of the fee. I then throughly documented the conversation, including the driver's name and id number.

Step Two: I took my invoice and the UPS documentation down to my local CBSA office. One could, in theory, skip to Step 3 and demand just the brokerage fee amount back from UPS rather than going through the rigmarole of clearing a package, paying the D's and T's yourself, and then claiming the whole amount back from the courier. I wanted to prove a point, cover all my bases, and the office was close by.

I explained to the bemused CBSA officer that a) I had a 'casual shipment' (i.e. personal non-commecial shipment) delivered by courier b) UPS claimed to have acted as a broker without my knowledge or consent, c) I wanted to properly clear my package by paying the D's and T's, and submitting this documentation to USPS for reimbursement. (Ironically, the CBSA officer next to my agent chimed in that she'd just had the same thing happen to her!) I made sure that the officer referenced UPS's invoice number and the package number in the notes field on the B-15 receipt, so that it was clear the D's and T's I paid were in respect of this particular shipment from UPS.

Step Three:

I called UPS. I explained I was not a happy bunny. The call-centre lady tried various tactics to get me to drop the matter. I pointed out that the exporter's 'authorization' is irrelevant, it's the 'importer's' (i.e. my) authorization that matters. I pointed out a variety of lawful options open to them: ship parcel to bonded warehouse, provide me the paperwork, have me clear and provide them the paperwork, deliver. Or, account for and release goods, have me pay shipment. Or, obtain my authorization prior to them paying the duties and taxes on the shipment.

It took a couple of follow-up calls (I made sure to record the agents' names and id numbers), but eventually UPS agreed to a refund.

Step Four:

Fax my B-15 to UPS (so they can get a D & T refund from CBSA) and confirming cover letter. In case anyone wants to copy/paste from my draft letter:

Re Invoice XYZ###

Dear Sir or Madam,

As discussed with XXXX (###) and YYY (###), someone at UPS apparently claimed to act as my agent and erroneously cleared this package on his/her own initiative (rather than obtaining my prior written authorization, having the package released under s. 32(4) Customs Act subject to my accounting for it under s. 32(5)(b), or moving it in bond to [Your City Here] to be cleared by yours truly prior to your delivery.)

Since UPS was (and is) not my agent, and I have paid all duties and taxes owing on this parcel myself, you shouldn't owe the CBSA anything. As promised, I have attached a copy of my B-15 (BB-ZZZ###, [date]) for your files.

I trust you will promptly refund the $##.## I was incorrectly charged for your "services".

Thank you for your diligent attention to this matter,

Regards,

"

Step Five: wait three months, then receive and cash refund cheque.

Conclusion

Your milage with the above may vary. The above outlines a little bit of the context (so you can hopefully cross swords with UPS agents from a position of knowledge, especially of alternative actions UPS could have taken), and what I used/did to get a refund of the fee. I hope it helps someone, if only to convince them that USPS really is the better option.

Caveat:

I am not your lawyer, barrister, solicitor, attorney, broker, or other legal representative. The above is not legal advice. I'm posting here because this issue is a 'pet peeve' of mine, and I have prior experience dealing with UPS on brokerage fees. The above is simply based on my personal fight with UPS, and my personal experience working with the Canadian import/export system, nothing more. When in doubt: read the Act yourself, call CBSA, and instruct counsel.