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When should I contact a broker?
What documents does CBP require for import clearance?
What is the difference between Continues and Single Entry Bonds?
Where can we find information on Anti-dumping and Countervailing duties (AD/CVD)?
How is my shipment affected by new tariffs on Chinese imports?
The Customs detained my baggage. What’s next?
Do I need a Delivery Order?
When should I contact a customs broker?
It depends on how much you know about the product you intend to import and transportation mode. The product can be subject to US import restrictions of Federal Agencies, subject to quotas, or increased tariffs. The importer should contact a customs broker before she buys the product to check on those restrictions.
If the product is shipped by sea, the broker should be contacted at least 72 hours before the merchandise is loaded on the vessel at the port of export to avoid late ISF filing.
What documents U.S. Customs requires for import clearance?
For all cargo shipments:
– Invoice;
– Bill of Lading or Air Waybill;
– Customs Bond – for goods of customs value more than $2,500, and for restricted merchandise;
In addition to these documents, the following documents may be required in some cases.
For merchandise subject to trade agreements and preferential duty rates:
– Certificate of Origin;
– Prove the regional value content.
For merchandise subject to Participating Government Agencies (PGA):
– Declarations, Permits, Licenses specified by the agency.
Most popular articles subject to PGA requirements
– Vehicles and engines, Pesticides, Toxic substances: EPA
– Human and Animal Foods, Medical Devices, Tobacco Products, radiation-emitting Products, Cosmetics, Drugs: FDA
– Vehicles, certain parts for vehicles: NHTSA
– Live animals, plants, cut flowers: APHIS
– Fish and wildlife: FWS
What is the difference between Continues and Single Entry Customs Bonds?
US import regulations require a bond when the value of the merchandise exceeds $2,500.
The importer can use the annual bond covering all shipments for 12 months, up to the bond limit. Alternatively, purchase a single entry bond for every shipment.
The bond decision should be based on the customs value of merchandise, customs duties, number of entries per year, and mode of transportation.
Continues bonds with $50,000 of minimum liability coverage may cost the importer around $400-$450.
Single entry bond would cost at least $35 filing fees plus about $1.50 per $1000 of the merchandise and customs duty value.
If the value of the merchandise plus duties exceeds $300,000, then the annual bond would be a more economical option, even for one entry.
If the merchandise is delivered by sea, then the ISF bond is required, which costs the importer about $75. Continues bond covers both ISF bond and Single Entry Bond. A single entry bond doesn’t include the ISF bond. As a result, the total cost of bonds for one sea shipment would be at least $110 ($75 ISF bond plus $35 single entry bond) if the importer doesn’t have a continuous bond on file.
So, if the importer has 4 or more sea shipments per year, the continuous bond could be a better option.
Where can we find information on Anti-dumping and Countervailing duties (AD/CVD)?
We are ordering folding boxes from China. Our broker told us that the boxes were subject to increased duties on Chinese goods and could be subject to Anti-Dumping duty (AD/CVD), which can be huge. HTS shows increased duty on folding boxes but doesn’t show AD/CVD. Can an article be subject to both increased duties and AD/CVD?
To determine AD/CVD’s applicability to a particular product, the importer must read the AD/CVD cases that cover the product. Not all folding gift boxes from China are subject to AD/CVD. For example, the AD/CDV investigation massage excludes gift boxes manufactured from paper or paperboard of a thickness of more than 0.8mm. It also excludes “non-for-sale” or “give-away” gift boxes – the boxes that have the retailer’s name, logo, trademark, or similar company information printed permanently on the folding’s cartoon top exterior.
Information on Anti-dumping (AD) and Countervailing duties (CVD) can be found on the ADD CVD Search page of the U.S. Customs and Border Protection web site.
How is my shipment affected by new tariffs on Chinese imports?
Increased tariffs on Chinese goods significantly impact small shipments than just 25% additional duty.
According to the U.S. Customs regulations, commercial merchandise is eligible for informal entry when shipments do not exceed $2,500 in value. CBP shall clear free of duties and taxes (release under Section 321) any shipment of merchandise having a fair retail value in the country of purchase not exceeding $800.
In general, informal entry procedures are simpler than formal entry. Informal entry allows to clear the merchandise without customs bond, and in many cases, importers can clear their shipments without hiring a customs broker.
However, merchandise over $250 subject to safeguards duties as described in Chapter 99 Subchapter IV, CFR Title 19, Customs Duties, requires a formal entry.
Due to additional duties on Chinese goods, those goods can not be imported under informal entry procedures if their value exceeds $250.
As a result, small shipments get hit by a 25% additional tariff and by other expenses on formal entry. For example, we know that a 25% increase of duty on a $1,000 shipment requires a payment of $250 of customs duty. However, the requirement for formal entry brings additional “non-tariff” expenses, such as Merchandise Processing fee, about $35 Bond filing fee, and about $100 – $150 broker’s service fees.
The Customs detained my baggage. What’s next?
The Customs detained my luggage when I brought a few spare parts for my car from my trip to another country. The CBP officer said I needed a broker to file Entry. Why did they seize it if the parts’ value was only $600, and the “duty-free threshold” is $800? What’s next?
CBP may require Formal Entry for any merchandise of value over $250 and subject to PGA regulations, such as FDA, EPA, NHTSA, or subject to safeguard duties.
Some spare parts for vehicles are subject to NHTSA regulations. NHTSA “sticker” or sign has to be shown on such parts. Other parts are not subject to NHTSA regulations. It is the responsibility of importers or their customs brokers to determine auto parts’ admissibility and properly declare it.
When CBP detain luggage, they send it “In Bond” to the air cargo warehouse. The officer will give the passenger a copy of the In-Bond Baggage Manifest. The importer or her broker must contact the cargo department of the airlines to request an air waybill for their “cargo.” As soon as the airlines have created the air waybill, the importer, or the broker, can file entry documentation with the CBP. When CBP issues customs release, the importer may pick up her luggage at the cargo warehouse.
Do I need a Delivery Order?
My merchandise had been cleared through Customs by my customs broker. When I came to the air cargo warehouse to pick it up, the warehouse employee told me I had to present a Delivery Order (DO). They said that my customs broker had to issue the DO. I am the owner of the merchandise. Why do I need a DO?
The short answer is: the request of the warehouse employee was unlawful.
First, customs brokers don’t have to issue DOs. Most brokers can create DO when necessary and when importers ask for it. However, DO is not a US Import document, and it is not related to the customs business. Usually, brokers treat it as an “additional service” and charge some fee for it.
Second, the Delivery Order is not required when the owner of the merchandise is present. According to the Uniform Commercial Code (UCC), a delivery order refers to an “order given by an owner of goods to a person in possession of them directing that person to deliver the goods to a person named in the order.”
For example, if the owner sends a trucker to pick up her goods, she must create a delivery order for local delivery and give it to the trucker.
In practice, when warehouse employees require you to present a DO when you are picking up your merchandise, you should ask their supervisor to intervene.