U.S. Border Paperwork Demands on Canadian Shippers Jump Tenfold as Audits Surge 26%

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For Canadian companies accustomed to treating the U.S. border as a relatively predictable part of doing business, the paperwork is becoming almost as important as the tariff bill. Breanna Leininger, who heads U.S. operations at Vancouver-based Pacific Customs Brokers, says requests for documentation tied to shipments have risen roughly tenfold compared with three years ago. At the same time, U.S. Customs and Border Protection figures cited by The Canadian Press indicate that customs audits in 2026 are on pace to run 26% above 2024 levels.

The tenfold figure reflects one major broker’s experience rather than an agency-wide CBP statistic, and the 26% figure is a projected increase rather than a completed full-year result. Even with those qualifications, the direction is unmistakable: Washington is demanding more proof about what crosses the border, where it came from, what it is worth and how it was made.

Border Enforcement Is Becoming a Cost of Trade in Its Own Right

Tariffs are easy to see because they arrive as a percentage attached to an invoice. Enforcement costs are less visible. A shipment can have the right buyer, a valid commercial invoice and a workable tariff rate, yet still become more expensive when customs officials request additional evidence about classification, valuation, origin or the underlying supply chain. Canadian shippers are increasingly having to budget staff time, customs-broker fees and management attention alongside the duty itself.

That is why the tenfold increase reported by Pacific Customs Brokers matters even though it is not a nationwide CBP measurement. It describes the operational experience of a firm handling real cross-border traffic at a time when U.S. policy is explicitly pushing customs officials toward more intensive enforcement. The June 2026 executive order on customs enforcement directs U.S. authorities to increase audits, strengthen importer vetting and demand more supply-chain information. What once might have felt like occasional follow-up paperwork is therefore becoming a more routine commercial risk for companies selling south of the border.

The Paperwork Can Reach Deep Into a Product’s Supply Chain

A U.S. customs request can go well beyond asking for a missing invoice. CBP Form 28, formally called a Request for Information, can be used when customs officials need additional material to determine a product’s classification, value or eligibility for special tariff treatment. CBP estimates the average response burden for that form at about two hours, but complicated cases involving suppliers, production records or multiple imported components can require considerably more internal work.

The scope of U.S. disclosure requirements is also expanding. President Donald Trump’s June customs-enforcement order calls for detailed information on imported goods’ supply chains and production methods, including product identifiers, specifications and other information CBP considers relevant. A September proposal from CBP moved toward implementing broader import disclosures. For a Canadian manufacturer, that can turn customs compliance into a data-gathering exercise involving purchasing, accounting, engineering and suppliers. A finished product may cross the border in a single truck, but proving its customs treatment can require documentation reaching several layers back into the companies that supplied its parts and materials.

Washington Has Explicitly Ordered More Audits and Tougher Penalties

The rise in audits is not occurring in isolation. The White House’s June 3 executive order specifically tells the Department of Homeland Security to bolster customs enforcement through measures that include increased audits, stronger importer screening, liquidated-damages claims and tougher action against non-compliance. It also singles out forced labour, misclassification, undervaluation and illegal transshipment as enforcement priorities.

That policy direction is reinforced by the U.S. Department of Justice. Its Trade Fraud Task Force, created with the Department of Homeland Security in August 2025, said in July 2026 that its civil and criminal recoveries, penalties, forfeitures and publicly charged losses had exceeded US$1 billion in less than a year. The significance for an ordinary Canadian exporter is not that every paperwork error becomes a fraud case. Rather, customs enforcement has moved higher on Washington’s priority list. Pricing structures, country-of-origin claims and tariff classifications that might once have received little attention can now face more questions, while deliberately inaccurate declarations carry increasingly serious financial and legal consequences.

CUSMA Preference Now Comes With a Bigger Proof Burden

CUSMA can still provide substantial tariff advantages, but preferential treatment does not mean customs officials simply accept that a product is Canadian. CBP says a CUSMA certification of origin must contain nine minimum data elements, even though companies are not required to use a single prescribed certificate format. Importers, exporters and producers need documentation capable of supporting the claim that a product actually meets the agreement’s rules of origin.

That distinction has become more important as U.S. authorities focus on third-country inputs and the possibility that goods from outside North America could be routed through Canada or Mexico. A Canadian factory assembling a product from imported components may therefore need to demonstrate far more than its Canadian address. Relevant records can include material sourcing, production information and the calculations used to establish originating status. CBP recordkeeping rules generally require relevant entry records to be retained for five years. In practical terms, a CUSMA claim increasingly needs to be treated as an auditable position rather than a box checked when the shipment leaves the warehouse.

Low-Value Shipments Have Lost a Major Administrative Shortcut

The compliance squeeze is also being felt by companies that once relied heavily on small shipments. The United States suspended duty-free de minimis treatment for shipments valued at US$800 or less from all countries beginning August 29, 2025. For non-postal cargo, CBP says those shipments must use an appropriate entry type in the Automated Commercial Environment and are subject to applicable duties, taxes and fees.

That change matters to Canadian e-commerce sellers, replacement-parts suppliers and manufacturers that frequently send samples or small orders. Low-value goods were once able to move through a comparatively streamlined channel; now many require customs data and duty handling that would previously have been unnecessary. The scale of the former system shows why Washington targeted it: CBP estimated that 1.36 billion de minimis packages entered the United States in fiscal 2024. For a Canadian company sending a $150 replacement component, the product may still be inexpensive, but the administrative process attached to it is no longer necessarily small.

Smaller Exporters Can Feel the Compliance Costs Most Sharply

Large manufacturers can maintain internal trade-compliance teams, customs specialists and databases containing years of origin and valuation records. A smaller Canadian exporter may have one employee dealing with U.S. customers, freight bookings and customs paperwork at the same time. When a border agency asks for deeper documentation, the underlying legal obligation may be the same, but the disruption is not distributed evenly.

The broader financial environment has already become difficult. Purolator research released in June, based on 348 supply-chain and logistics decision-makers plus 41 in-depth interviews, found surveyed Canadian companies reported an average annual tariff impact of $661,000. Ninety-three per cent of businesses surveyed said they had already made operational changes, while only 39% considered themselves fully prepared to make further changes if conditions deteriorated. Canadian customs brokers have also reported customers delaying shipments while trying to finance higher U.S. duties. Add repeated documentation requests to that equation, and compliance becomes another drain on working capital and staff capacity rather than a simple clerical task at the border.

Hiring a Customs Broker Does Not Eliminate the Importer’s Responsibility

Customs brokers can make the process far more manageable, but they do not automatically transfer away the legal responsibility attached to an import. CBP states that the importer of record remains ultimately responsible for the correctness of entry documentation and for compliance with applicable duties, taxes and federal requirements, even when a licensed broker prepares and files the paperwork.

That creates an important distinction for Canadian businesses operating as foreign importers of record in the United States. A broker can classify merchandise, transmit data and help answer CBP questions, but the underlying company still needs reliable product information. CBP describes “reasonable care” as a core importer obligation involving entry, classification, valuation and the information needed to calculate duties and satisfy other legal requirements. Records generally must be maintained for five years and produced when CBP requires them. A broker therefore works best as part of a compliance system, not as a substitute for one. If the supplier data feeding that system are wrong, professionally filed customs paperwork can still contain the wrong answer.

The Size of Canada-U.S. Trade Makes Small Frictions Economically Important

The enforcement changes are especially consequential because the United States remains by far Canada’s largest merchandise market. Statistics Canada reported that Canada exported $50.5 billion in goods to the United States in July 2026 alone. That represented roughly two-thirds of Canadian merchandise exports during the month, even after exports to non-U.S. markets climbed to a record $25.6 billion.

July also demonstrated how quickly the bilateral numbers can move. Canadian exports to the United States fell 6.6% from June, while imports from the United States increased 1.8%. Canada’s merchandise trade surplus with the U.S. consequently narrowed from $10.3 billion to $5.9 billion. Paperwork delays will not explain swings of that magnitude on their own, but the scale of the trading relationship shows why administrative friction matters. When tens of billions of dollars in goods cross in a single month, even a modest increase in brokerage work, inventory holding time or documentation failures can be multiplied across thousands of companies and shipments.

Good Customs Records Are Turning Into a Competitive Advantage

The businesses best positioned for this environment are increasingly those that can answer customs questions quickly. That means having tariff classifications tied to defensible product descriptions, origin claims supported by supplier evidence, valuation methodologies that reconcile with accounting records and a clear understanding of which entity acts as importer of record. PwC has advised Canadian businesses to map imports and exports by classification, supplier, origin, customs value and importer status, while keeping contemporaneous shipping documentation.

There is also a practical human benefit. Imagine two Canadian manufacturers receiving similar requests from CBP. One has supplier declarations scattered through email accounts and must reconstruct a bill of materials from several departments. The other maintains an organized file linking each product code to its classification, origin analysis and supplier documents. Both may ultimately prove their shipments compliant, but the second company can answer faster and with less interruption. In an enforcement environment where CBP is using more data and requesting greater supply-chain visibility, record quality is becoming part of operational resilience rather than merely an administrative housekeeping exercise.

The Compliance Pressure Is Unlikely to Disappear With the Next Tariff Change

Canadian exporters should not assume that customs scrutiny will fall away if tariff negotiations eventually improve. The current enforcement push rests on measures that extend beyond any single tariff dispute. The June executive order directs changes to importer eligibility, bonding, supply-chain disclosures, vetting and penalties, with several measures scheduled for implementation during the second half of 2026. PwC has warned Canadian businesses that many Canadian entities acting as U.S. importers may fall into the order’s new “foreign importer of record” category and face additional restrictions.

CUSMA also remains in force, but without the long-term certainty businesses had hoped to receive this year. The United States declined to agree to a 16-year extension during the July 2026 joint review, triggering annual reviews while the existing agreement continues in force through 2036 unless the countries later agree to extend it. That leaves Canadian companies facing two overlapping realities: preferential North American trade rules remain valuable, while proving compliance with those rules is becoming more demanding. For many shippers, the border challenge is no longer simply what tariff applies. It is whether the paperwork behind that answer can survive scrutiny.

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