Canada continues to be one of the most valuable international expansion opportunities for U.S. ecommerce brands. With strong cross-border demand, high ecommerce adoption, and geographic proximity, it’s often a natural first step for brands looking to grow internationally.

As brands expand into Canada, one shipping model they’ll likely encounter is the Non-Resident Importer (NRI) program. While NRI shipping can make sense in certain scenarios, it’s important for direct-to-consumer (DTC) brands to understand how it works  and whether it’s truly the best fit for their business model.

In many cases, brands shipping directly to Canadian consumers may benefit from a simpler approach that avoids unnecessary operational complexity.

Here’s what ecommerce brands should know about Canada NRI shipping and how to evaluate the right strategy for your business.

What is an NRI in Canada?

A Non-Resident Importer (NRI) is a business located in the US that assumes the role of the Importer of Record (IOR) for goods being shipped into Canada. This means the US merchant is responsible for managing customs clearance, ensuring compliance with Canadian laws and regulations, as well as paying duties, taxes, and fees for any imports. 

Companies registering as a Canada NRI will receive a unique import/export account number, which is separate from a GST/HST business number used for tax purposes. 

It’s important to note that for DTC shipments, the Canadian consumer is the natural IOR. However, when a business chooses to ship as an NRI and designates themselves as the IOR, they assume full liability for all customs-related obligations. 

This shift in responsibility from the customer to the business can introduce additional complexities and risks that should be carefully considered.

What DTC Brands Should Know Before Shipping as an NRI

One of the most important things for brands to understand is that shipping as an NRI changes who is legally responsible for the import transaction.

In standard DTC shipments, the Canadian consumer is typically considered the natural importer of record. But when a U.S. business elects to operate as an NRI, the merchant assumes direct responsibility for customs obligations and import compliance.

Depending on your business model, this can introduce additional administrative requirements, including:

• GST/HST registration and remittance obligations
• CARM portal registration
• Customs surety bonds or security deposits
• Upfront duty and tax payments
• Long-term recordkeeping requirements
• Commercial customs clearance processes

Commercial clearances are often more complex and may involve higher brokerage costs than standard consumer import clearances.

For growing ecommerce brands, this added operational overhead may not always provide meaningful advantages — particularly for direct-to-consumer parcel shipments.

The Downsides of Canada NRI Shipping for DTC Brands

US Merchants have traditionally been advised to ship as an NRI to take advantage of reduced customs brokerage fees. This strategy was particularly effective for small package deliveries facilitated by express carriers, which would waive “per-shipment fees” for US businesses registered as an NRI, when their Canadian brokerage teams handled the customs clearance. However, this fee structure is not universally applicable, as many other carriers operate differently when clearing shipments into Canada. 

Additionally, Canada NRI shipments are categorized as commercial rather than “casual”, resulting in forfeiting the many advantages associated with personal imports. When the United States-Mexico-Canada Agreement (USMCA) came into effect on July 1st, 2020, it greatly impacted the shipping landscape for DTC brands. 

Under current USMCA rules, Canada applies a tax de minimis threshold of $40 CAD and a duty de minimis threshold of $150 CAD for eligible non-postal shipments. This means many low-value ecommerce orders can enter Canada without duty, although taxes may still apply depending on the shipment value and import circumstances. For ecommerce brands, these thresholds can influence landed-cost calculations, shipping strategy, and decisions around who acts as the importer of record.

When a US merchant is listed as the importer, the values of multiple shipments to different consumers must be  combined as if they were all part of a single shipment, making it almost certain to surpass the de minimis thresholds. As a result, duties and taxes may be incurred on imports that might otherwise have cleared under these thresholds if treated as individual shipments.

Risks and Responsibilities of Being an NRI in Canada

When you ship DTC from the US to Canada, the default importer is the Canadian consumer. However, shipping as an NRI and naming yourself as the IOR makes you wholly liable for all fines, penalties, and fees in the eyes of the customs and tax authorities– including any civil or criminal charges. On top of this added risk, the introduction of CARM has shifted more responsibilities onto the importer, making being an NRI even less attractive.

Here are some challenges businesses should consider associated with Canada NRIs:

• You must collect and remit GST/HST if required to register.
• You may have to submit a security deposit between $5,000 – $1M CAD if your annual sales are over $100,000 CAD and annual net tax is more than $3,000 CAD.
• You will need to register for the CARM client portal and purchase your own customs surety bond, pay duties and taxes up front, or make a cash deposit with Canada Border Services Agency (CBSA) to clear shipments.
• You must maintain GST/HST books for six years.
• If you are maintaining records in the US, you must complete a letter of undertaking with the Canada Revenue Agency (CRA) promising to pay for travel and accommodation expenses incurred by a CRA officer in the event of an onsite audit.
• You must use commercial clearance instead of other more beneficial customs clearance programs like the Courier Low Value Shipment (CLVS) Program.
• Most carriers and customs brokers charge a minimum fee for commercial clearance as they are more time-consuming and complex than casual clearances. 
• You cannot use the Canadian Investment Regulatory Organization (CIRO) to benefit from duty and tax de minimis levels.
• You cannot use the Casual Refund Program to help Canadian consumers recover duties and taxes paid on returns.

While it’s generally advisable for DTC merchants to refrain from voluntarily becoming the IOR, there are instances where it’s necessary. For example, if you’re a merchant shipping goods to a Canadian fulfillment center like Amazon, and the receiving warehouse is unwilling to act as the importer, assuming the role of IOR may be unavoidable.

A Simpler Approach for Many DTC Brands

For many direct-to-consumer brands shipping from the U.S. to Canadian shoppers, you don’t need to register as a Non-Resident Importer to deliver a strong cross-border experience.

A simpler option is to keep the Canadian customer as the importer of record (the default for most consumer parcel shipments) and focus on making the purchase experience clear and predictable. 

In practice, that means:

• Setting accurate expectations at checkout about duties/taxes and delivery timing
• Using the right carriers and clearance workflows for low-value DTC parcels
• Preserving de minimis advantages where they apply, instead of consolidating values under the merchant as IOR
• Reducing administrative overhead, like NRI registration, bonds/security, and long-term compliance obligations

For many brands, this approach is more scalable, easier to operate, and better aligned with how most Canadian DTC orders naturally clear customs.

How Passport Helps Brands Expand Into Canada

Passport helps DTC brands expand into Canada with a cross-border strategy that reduces friction without taking on unnecessary importer liability.

We partner with brands to design the right approach for Canadian growth, including:

• Cross-border shipping model selection (including when NRI is—and isn’t—worth it)
• Carrier and clearance strategy optimized for DTC parcel performance
• Landed cost support to improve transparency and conversion at checkout
• Guidance on customs and tax considerations, so brands can scale confidently as volume grows

Whether you’re exploring NRI shipping, trying to simplify your current Canada workflow, or building a stronger international experience end-to-end, Passport helps you choose the most efficient path to Canada and execute it with confidence.

Reach out to our team here

Authored by Thomas Taggart

Head of Global Trade | Passport

Thomas Taggart is a cross-border commerce leader with more than 20 years of experience in international shipping and regulatory affairs. As the Head of Global Trade, Thomas helps ecommerce brands go global by simplifying international trade, tax, and product compliance issues. Prior to Passport, he brought international shipping solutions to market through multiple roles in UPS’s product development organization.

Frequently Asked Questions

What is a Non-Resident Importer (NRI) in Canada?

A Non-Resident Importer is a business located outside Canada that assumes responsibility for importing goods into Canada, including customs clearance, duties, taxes, and compliance obligations.

Is NRI shipping required for ecommerce brands shipping to Canada?

No. Many DTC ecommerce brands ship successfully into Canada without operating as an NRI. In many cases, the Canadian consumer remains the importer of record for direct-to-consumer shipments.

What changed under USMCA?

USMCA increased Canada’s de minimis thresholds for non-postal shipments to:

• $150 CAD for duties
• $40 CAD for taxes

This created new advantages for many direct-to-consumer ecommerce shipments.

What is CARM?

CARM (CBSA Assessment and Revenue Management) is a Canadian customs initiative that modernizes how importers manage duties, taxes, and compliance obligations with the Canada Border Services Agency (CBSA).

When does NRI shipping make sense?

NRI shipping may make sense for businesses importing bulk inventory into Canada for:

• Retail distribution
• Wholesale operations
• Canadian warehousing
• Marketplace fulfillment programs

Can Passport help determine the right Canada shipping strategy?

Yes. Passport works with ecommerce brands to evaluate cross-border shipping models, customs considerations, and compliance requirements to help brands expand into Canada efficiently and confidently.