Nova Scotia Journal

A company in Nova Scotia was fined $50,000 for an American lobster mislabelling ruse

company in Nova Scotia was fined $50,000

Key Takeaways:

  • Atlantic ChiCan claimed to have exported U.S. lobster to China.
  • A Chinese-owned lobster company in Nova Scotia was fined $50,000 for illegally shipping American lobsters to China while claiming they came from Canada.

On Thursday, Atlantic ChiCan pleaded guilty to two counts of mislabelling in provincial court in Dartmouth, N.S.

Due to an agreed statement of facts presented in court between May and October 2019. The large holding facility on Cape Sable Island in southwest Nova Scotia imported 63,000 pounds of live lobster from the United States. It exported it as a product of Canada.

The lobster was delivered from Stanfield International Airport in Halifax. Unfortunately, the Trump administration and China were engaged in a trade war, and Maine lobster was subject to a 49% tariff upon entering China.

According to federal Crown prosecutor Max Kruger, tariff avoidance was an outcome, but there was no proof that it was the driving force behind the scheme.

“In this case, the Chinese would not have applied customs tariffs to that shipment as a result. We didn’t have any evidence that ChiCan’s actions were motivated by that, “He stated.

American lobster mislabelling ruse; Image from The Guardian

“The evidence we did have, including statements from plant staff, was that they were attempting to meet insatiable market demand from their Asian customers, particularly China, and that is why they were sourcing American lobster.”

Whatever the motivation, Kruger believes the deception jeopardized Canada’s customs and food traceability commitments.

“That reporting system is relied on by our international trading partners. We share information with our cooperating agencies. They depend on it to determine the country of origin of the goods being shipped, “Kruger stated.

Canada’s food traceability and customs certificates are based on an “honor system,” which allows the exporter to fill out the country of origin in documents.

The Atlantic ChiCan ruse was discovered by the Canadian Food Inspection Agency during an inspection at Clark’s Harbour on Cape Sable Island on September 24, 2019.

The information was forwarded to the Canada Border Services Agency, which obtained a search warrant. A review of customs declarations revealed that Atlantic ChiCan exported lobster 286 times between June 1 and September 30, 2019, with Canada always listed as the country of origin.

According to the joint statement, Atlantic ChiCan temporarily lost honor-system privileges, “resulting in significant costs accrued” to the company.

Source: CBC News

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