If you are new to importing goods into the United States there are many requirements, restrictions, and regulations involved. From quota restrictions, other government agency permits or inspections to customs forms. Some information, such as an item being eligible for reduced rates of duty or eligible for one of the many Free Trade Agreements, or products that are not permitted to enter the commerce of the United States because they are manufactured from a facility located in an embargoed country, can only be determined if you know the products Harmonized Tariff Schedule Classification. Determining your product’s tariff number can be extremely complex. Starting out with a good understanding of customs regulations and requirements are key to importing success. Below is a brief overview of what is required when shipping goods into the United States.
Requirements for importing into the United States:
1. Determine the use of a customs broker.
Customs clearance also commonly referred to as customs release is probably the first thing to consider. Depending on the value of your shipment you need to determine if a customs broker is required.
For shipments valued under $2500.00, U.S. Customs and Border Protection (CBP) will typically allow the goods to enter into the U.S. under an informal entry. However, in cases where the goods are regulated by U.S. Food and Drug Administration (FDA), or if the goods fall under Anti Dumping Duty/ Countervailing Duties, quota, or other restricted goods, these goods require a formal entry and do not qualify for this exemption.
If a formal entry is required you need to have an account set up with a customs broker and documentation prepared prior to shipping. Documentation is usually completed by the exporter or supplier prior to the goods being delivered to the carrier. The importer of record is ultimately responsible to ensure that the documentation provided is accurate and complete. It is critical that you have all the proper documentation and information. Once paperwork is submitted to your customs broker, they will review the information for accuracy prior to the information being submitted to U.S. Customs and Border Protection.
2. Prepare import documents prior to shipping.
Documents that are typically required with each shipment are listed below:
- Customs or Commercial Invoice
- Bill of lading
- Other government agency documents
- Commodity specific requirements or documents
3. Meet commodity specific and Other Government Agency (OGA) requirements.
Commodity specific and other government agency (OGA) requirements depend on other government agencies’ safety, energy efficiency, health, standards, etc. Many of the items cannot be imported without a permit, license or additional documentation to satisfy the agency’s requirements.
Everything imported into the U.S. must be properly marked with the country of origin. There are some exceptions to the marking requirements which are listed in the federal code of regulations 19CFR134.33 the J List exceptions. Some products are very hard, or impossible, to mark such as:
- cut flowers
If imported in a container and the container reaches the ultimate purchaser, then it is required to be marked with the country of origin.
4. Pay import duty fees and taxes.
Duty rates are fees that are paid to U.S. Customs and Border Protection. Duty rates are based on the classification of the products that are entering the USA. The Importer of Record is responsible for paying these fees. Your customs broker has the authority to pay the duty fees on your behalf and invoice you for them or set up an automated clearing house account for you to pay the duty directly to U.S. Customs.
5. Determine correct harmonized tariff schedule.
Products that enter the U.S. are classified according to the Harmonized Tariff Schedule of the United States. Goods are placed in a product category called classification, the number used to classify the product is more commonly referred to as a Harmonized Tariff Schedule or HTS number. The classification number is 10 digits and that number determines the rate of duty that will be applied to your product. U.S. Customs has an online version of the most current HTS codes available.
Classification can be a very difficult process that generally requires a lot of research and product information. As the Importer of Record (IOR), you are ultimately responsible for providing the correct product classification to U.S. Customs and Border Protection. Entering goods into the United States with an incorrect classification or duty rate could result in penalties or increased duty bills. Many importers choose to hire a customs broker to assist them with the classification of their goods. Do not be surprised if your customs broker asks for ingredient lists or written literature on your product when assisting you with your product classification.
In conclusion, it is the Importer of Record’s responsibility to make sure that their goods meet all the requirements for entry into the United States. A customs broker is there to lend a hand and assist you with the various requirements and regulations. Always plan ahead and be sure to know before you go to ensure a hassle free importation into the U.S.
If you are importing or exporting goods into the USA, Pacific Customs Brokers can help. We work with all types of importers from a broad range of industries offering U.S. and Canadian customs brokerage, trade compliance consulting, freight forwarding, warehousing and distribution services.
Learn more about importing into the USA:
Get a comprehensive understanding of the process involved when importing into the USA at our upcoming webinar Importing for the Beginner-US [Part 1]. Take your learning a step further by attending the Importing for the Beginner-US [Part 2] webinar and delve into the details previously touched upon in part one of the series.
Our in-house seminar on U.S. Customs Compliance is another great way to understand the movement, compliance and regulations around goods imported into the USA.
Have questions or comments regarding importing to the USA? Leave them in our comments section below or email Ask Your Broker.