Archive for the ‘US Customs’ Category


 

ACE Transition – Changes to FDA Entry Filing

Update

The U.S. Food and Drug Administration (FDA) has now completed its transition to the Automated Commercial Environment (ACE). As a result, all goods regulated by the FDA must be transmitted via ACE effective June 15, 2016 and will no longer be accepted in the previous Automated Commercial System (ACS). Additional information is now required when filing entries and corresponding entry summaries for FDA regulated goods.

What additional information will be mandatory?

  • Commodity details and intended use
  • Description of how the commodity is processed
  • Product state (i.e. fresh, frozen, shelf stable, etc.)
  • FDA product code
  • Country of production or source
  • Full and detailed invoice description
  • Full name and address of the:
    • Manufacturer
    • Shipper
    • Importer
    • Consignee
    • Consolidator
    • Farmer/grower (if applicable)
    • Processing plant (if applicable)
  • FDA registration number(s)
  • Port of entry
  • Quantity
  • Weights (actual, rather than estimated)
  • Packaging type
  • Product line value
  • Arrival date and time

Certain commodities may require additional information. Please contact Pacific Customs Brokers for additional details.

How will this affect my entry?

Pacific Customs Brokers may contact importers to obtain any mandatory information required for the entry filing with ACE and FDA.

As CBP and FDA implement this mandatory filing requirement entry filing delays are to be expected. It is imperative to note that missing information will result in additional processing delays.

Have questions or comments regarding the potential processing delays you may experience? Have tips for minimizing shipment delays? Share your thoughts with us. Leave them in the comments section below or email Ask Your Broker.

What You Need To Know Regarding the Section 321 De Minimis Value Increase

Value price

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

On February 24, 2016 President Barack Obama signed into law the Trade Facilitation and Trade Enforcement Act of 2015 (H.R. 644) (TFTE), also referred to as the Customs Reauthorization bill. This law addressed a bevy of trade topics, including the de minimis value for the entry of low value goods. Commonly referred to as Section 321, this legislative measure raised the Section 321 de minimis value from $200 or less to $800 or less. The Section 321 provision allows for low value entries, valued at $800 or less, to enter into the commerce of the U.S.duty free and without formal entry. For many importers this was very goods news as it reduced the amount of paperwork required on low value shipments, but it also created a potential compliance pitfall.

Section 321 Product Restrictions:

Goods requiring inspection as a condition of release, regardless of value, merchandise subject to Anti-Dumping / Countervailing duty (ADD/CVD), and certain products regulated by the following Partner Government Agencies (PGAs), may not qualify under Section 321:

  • Food and Drug Administration (FDA)
  • Food Safety Inspection Service (FSIS)
  • National Highway Transport and Safety Administration (NHTSA)
  • Consumer Product Safety Commission (CPSA)
  • United States Department of Agriculture (USDA)

Section 321 Daily Restriction:

As mentioned by authors Teresa M. Polino, Orisia K. Gammell and Julia L. Diaz in the Arent Fox LLP article Did You Know: The 2015 Trade Enforcement Act Can Save Importers Money?, “this increase applies to shipments of articles imported by one person (e.g., a company) on one day, other than in the case of articles sent as gifts from a person in foreign countries or in the case of articles accompanying and for the personal or household use of a person arriving in the U.S.”

Under this regulation importers are only allowed to take advantage of the Section 321 benefit on one single transaction per day.

Carriers may make a Section 321 claim in conjunction with their eManifest filing, subsequently reducing the amount of paperwork on such low value transactions.

Best Practices:

Ensure that your carrier is not making multiple Section 321 claims. Carriers may elect to make the Section 321 claim in order to expedite the clearance process being unaware of whether the importers daily allowance has been reached or not. To avoid hefty penalties it is recommended that shipment filings be highly regulated in the following ways:

  • Identify the particular shipment the Section 321 claim will be used each day
  • Request that a formal entry be made on all other entries
  • Use the services of one customs broker to ensure import/export transactions are filed in a consistent manner
  • Build strong communication lines with the logistics team including carriers, freight forwarders, and customs brokers

Have questions or comments regarding this provision and how you can ensure that you are taking advantage of Section 321 within the compliance guidelines? Leave them in our comments section below or email Ask Your Broker.

3 Steps to Importing a Road Vehicle into the USA

3 Steps to Importing a Road Vehicle into the USA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With the current exchange rate many Canadian used vehicles are being actively sourced by U.S. buyers. Importing a road vehicle into the U.S. can be difficult; however, we have broken down the process into these three easy steps:

1. Ensure the vehicle is admissible for import.

Vehicles will need to have both an Environmental Protection Agency (EPA) sticker and a Department of Transportation (DOT) sticker affixed to the vehicle. If the vehicle is 21 years old it is exempt from the DOT certification sticker. If it is over 25 years, it is exempt from the EPA certification sticker. If the vehicle is without a DOT sticker, it may still be eligible for import; however, it will need to be imported through a registered importer who is required to hold the vehicle for a minimum of 30 days after import. Vehicles with missing EPA stickers will need a letter of conformity from the manufacturer in order to import the vehicle. If a letter of conformity cannot be obtained the vehicle is not admissible for import into the U.S.

Additionally, if the vehicle holds a rebuilt or salvaged title it is not admissible for import into the U.S.

2. Create/obtain the required documentation.

Since U.S. Customs and Border Protection (CBP), the DOT and EPA are involved with vehicle imports, it is important to understand that each agency has specific documentation requirements. The following list of forms will need to be accurately completed and submitted:

  • U.S. Customs or Commercial Invoice
  • DOT Vehicle Declaration Form (HS-7)
  • EPA Vehicle Declaration Form (3520-1)
  • Copy of the vehicle registration

3. Have the vehicle steamed, sprayed or cleaned thoroughly before shipment.

The U.S. Department of Agriculture requires that the undercarriage of the imported vehicle be free of foreign soil to safeguard against importation of dangerous pests.

Wherever you may be in the purchasing process whether you are currently importing a vehicle or still in the contemplation stage and need assistance, please contact us.

Have you successfully or not quite successfully imported a vehicle into the USA? What has your experience been? Share it in our comments section below or email us at Ask Your Broker.

Why You Should Conduct an Internal Customs Compliance Audit for U.S. Imports

Internal customs compliance audit

The responsibility of an importer to exercise reasonable care when importing to the United States has been at the core of customs compliance since the implementation of the Customs Modernization Act (Mod Act) in 1993.

U.S. Customs and Border Protection has the expectation that importers must be knowledgeable and proactive in the conduct of their legal responsibilities. Unfortunately, as members of the trade community, we occasionally hear comments such as “I didn’t know”, or “My broker never told me”.  The bottom line is that it remains the importer’s responsibility to have a comprehensive understanding of their obligations to Customs.

While customs law can be quite complex and somewhat bewildering, there are a relatively small number of very specific areas that form an importer’s foundation of compliance.  As laid out in the U. S. Customs and Border Protection Informed Compliance Manual entitled Reasonable Care these specific topics are briefly outlined here:

 

Areas in which importers must exercise reasonable care:

All Transactions

  • Use of external or internal experts
  • Review of all customs documentation, inclusive of entry declarations, for accuracy
  • Consistency in same or similar transactions across ports and modes of transport
  • Appropriate adjustments or Prior Disclosures when errors are discovered

 

Merchandise Description and Harmonized Tariff Classification

  • Having procedures in place to ensure that you are fully knowledgeable of the products you are importing – composition, country of origin, etc.
  • Properly describing the merchandise to Customs according to regulations
  • Ensuring that you are providing the correct tariff classification of the goods
  • Verification of whether your goods are eligible for specific duty free status

 

Valuation

  • Procedures to ensure accuracy of your declared transaction value, per Customs regulations
  • Are your transactions between “related” parties, and if so, ensuring that you are declaring the correct values to Customs?
  • Assists, commissions, royalties, etc., declared as appropriate

 

Country of Origin / Marking / Quota

  • Reliable procedures in place to ensure that the country of origin is declared correctly on your entry
  • All articles imported into the U.S. must be marked with the country of origin/manufacture
  • Processes established to determine and ensure that all necessary documentation is provided at time of entry

 

Intellectual Property Rights

  • Ensure that you have the legal right to import merchandise that is protected by trademark or copyright

 

Miscellaneous Questions

  • Ensure that you are filing the correct type of entry and that all other gov’t agency reporting is attended to

 

Please bear in mind that this is the “short list”.

 

The Importer’s Role in Trade Compliance

An efficient and compliant import process starts with everyone involved understanding their role and responsibilities. It is crucial that importers:

  • Understand their risks and responsibilities
  • Establish processes that ensure that all reasonable care standards are met, and
  • Ensure that these standards are monitored and enforced, safeguarding your continued privilege to import

 

Without having the proper knowledge of the responsibilities of an importer, and ensuring that you are both in compliance and have evidence of your actions, you may be at a higher risk for:

  • Penalties
  • Liquidated damages
  • Various customs audits
  • Increased costs of doing international business
  • Supply-chain disruptions and delays
  • Losing your import privileges

 

On the other hand, being knowledgeable about the expectations and acting with the expected due diligence, while not guaranteeing that you are not subject to an audit, does provide assurance that you are taking full advantage of allowable reductions in duty. Should Customs come knocking, you are prepared with appropriate responses to their questions.

 

Why conduct an internal customs compliance audit?

A thorough internal audit will help identify areas of risk and lay the foundation for your customs compliance plan.

 

Pacific Customs Brokers strongly encourages and advises every importer to conduct regular internal audits on their Customs transactions, and to use the Customs guideline in developing their internal controls and standard operating procedures.  The above-mentioned informed compliance publication on Reasonable Care is a great starting point.

 

How Pacific Customs Brokers Can Help?

Without proper customs training or hands-on instruction a business’ internal auditor will find identifying risks or exposures challenging. Our Trade Advisors stand ready to assist you in conducting an internal audit, and in working with you to develop or recommend improvements to your internal controls.

Stay Informed of Changing Regulations

To help you better understand complex compliance issues and implement effective solutions we offer a comprehensive Trade Compliance Education program. Explore one of our upcoming in-person seminars, online webinars and/or hands-on workshops to learn more. In particular, you might be interested in Part 2 of the next  U.S. Trade Compliance Seminar Series that takes a close look at Customs Audits and Importing Inspections. Learn more and register here!

 

Do you have questions about conducting an internal customs compliance audit? Ask our Trade Advisors. Leaving your comments below or email Ask Your Broker.

Ignorance is Not Bliss – The Potential Perils of Antidumping and Countervailing Duties

Antidumping and Countervailing Duties

As an importer of foreign goods coming into the commerce of the United States, you already know how complicated the import formalities can be, and there is always more to learn. One subject that may not have appeared on your radar is that of trade laws such as Antidumping (AD) and countervailing duty (CVD).

 

What is Dumping?

Dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer’s sales price in the country of origin, or at a price that is lower than the cost of production.

 

What are Countervailing Duties?

Foreign governments subsidize industries when they provide financial assistance to benefit the production, manufacture or exportation of goods. Subsidies can take many forms, such as direct cash payments, credits against taxes, and loans at terms that do not reflect market conditions. Countervailing duties are assessed to counter the effects of the subsidies provided by foreign government to merchandise that is exported to the United States. These subsidies cause the price of such merchandise to be artificially low.

 

Measures of Protection for U.S. Industry

If a U.S. industry believes that it is being injured by unfair competition through dumping or subsidization of a foreign product, it may request the imposition of antidumping or countervailing duties by filing a petition with both Enforcement and Compliance and the United States International Trade Commission. Enforcement and Compliance investigates foreign producers and governments to determine whether dumping or subsidization has occurred and calculates the amount of dumping or subsidies.

According to the United States International Trade Administration, there are hundreds of antidumping cases for 44 US trading partner countries, including but not limited to countries as diverse as Argentina, Canada, Italy, China, Malaysia and Ukraine.  There are more active AD cases for goods manufactured in China than from any other country.

Products affected range from ironing boards to wooden bedroom furniture to ball bearings to engineered wood flooring, solar panels and cells; from honey to salmon, from shrimp to pasta to mushrooms. New cases are initiated frequently, while other cases are terminated.  AD rates can range from less than 1% to over 250% of the import value of the goods.

 

Customs Entry Requirements

With all antidumping cases, there are additional formalities and documentation that is required to be presented with the customs entry, no matter the AD rate. U.S. Customs and Border Protection will require that the customs entry include documentation certifying that you, the importer, are not being reimbursed by the manufacturer for the cost of the antidumping duties. Because AD cases are assigned based on information provided by the manufacturer to the ITA, and different firms may receive either higher or lower AD rates, it is important that you provide the full legal name and address of the actual manufacturer and the exporter, in order to ensure that the correct AD case is associated with your entry.

 

Customs Bond Underwriter Requirements

Due to the very high risks that U.S. customs approved bond underwriters assume when writing these required bonds, they are very likely to require that importers affected by antidumping regulations provide 100% collateral at the time of their bond application or roll-over. They will also require that the importer provide full financial information at that time. Providing collateral involves transferring either a certified check or a letter of credit, generally equal to 1-2 years of the importer’s continuous transaction bond. These funds or release of the letter of credit will be held by surety in order to protect them should there be an increase in Antidumping Duties (ADD) liability, and will not be returned to the importer until at least 180 days after the final entry has liquidated.  Many years can pass before an Antidumping case is closed, thus permitting liquidation of the entries.

Note: Depending on the importer’s history, volume and value of imports, the surety may require further collateral at any time.

 

Recommendations for Importers of New Products

You may well imagine that being unaware of a potential AD case on your product, discovering that your goods are subject to an unplanned additional duty can come as quite a shock, not to mention a tremendous expense.

Pacific Customs Brokers recommends that you contact your customs broker or attorney prior to making purchasing decisions for goods that are new to your firm.  Our Trade Advisory team can assist you with research on the dutiability of the product and advise on eligibility for reduced or duty free treatments, in addition to determining whether it may be subject to Antidumping duties.

 

Understanding Antidumping or Countervailing Duties

To learn more about Antidumping or Countervailing duties attend an upcoming H.S. Tariff Classification Workshop.

 

What are your thoughts on Antidumping? Are your products impacted by these duties? Please share in our comments section below.