International Activities Corp. is a licensed customs broker, regulated under the Department of Treasury by the U.S. Customs Service. Only licensed customs brokers may conduct customs business on behalf of importers. Companies operating as customs brokers must also have at least one licensed customs broker on their staff.
Importer of Record
This is the responsible party for an importation. The importer is legally liable for payment of duties, taxes & fees and compliance with customs and other government agency regulations pertaining to their imports. This may be the party who is buying or receiving the imported goods, or an interested party in the transaction who has the right to make entry under the customs regulations.
Power of Attorney
A customs broker must have a valid customs power of attorney before representing or conducting customs business on behalf of the importer. This form is limited to customs import and export related transactions and services. The importer must also report their tax identification number, and specify whether they are importing as a corporation, partnership, sole proprietor, or an individual.
The Customs Service requires a customs bond be provided to protect the revenue and compliance with regulations. A customs broker can provide a bond on a single-entry or annual basis. An annual bond may prove more cost-effective depending upon import volume.
For entry purposes, the minimum documentation required is:
In general, the invoice must contain the following information:
- Shipper and Consignee’s full name and address.
- Seller and Buyer’s full name and address.
- Detailed description of the merchandise: name, grade, quality, marks, numbers, symbols, packing marks & numbers.
- Quantities in weights & measures
- Purchase price of each item in the currency of the purchase (this is the price paid or payable for the goods). Note the terms of the transaction, type of transaction, and/or the absence of a transaction
- Related charges for international shipping, insurance, commission, packing and containers, inland freight, rebates, drawbacks,discounts, assists where known and billed whether on the invoice or separately shown be itemized
- Country of origin. This means the country of manufacture, and is subject to customs rules of origin.
Bill of Lading or Air Waybill
This is produced either by the international carrier or a consolidator. Additionally, an importer should provide:
This should state what is inside each package. In the event that it is demanded by customs to facilitate an examination, the importer may incur additional expense to create a list after performing an inventory under customs’ supervision in a customs bonded warehouse.
The Entry Process
The customs broker takes the information gathered (in many instances further documentation or information may be required), and with the assistance of the importer properly rates and classifies the commercial invoice for customs’ purposes. The importer must exercise reasonable care in employing a customs broker to file an entry before customs.After data entry, the broker transmits the data electronically to the customs computer in Washington. The results of the transmission dictate the remaining entry process, which may entail further document review or physical examination.Many commodities are subject to restrictions and specialized procedures, such as quota. An importer is best served by pre-planning their shipments, consulting with a broker beforehand to ensure compliance and an understanding of any potential limitations or delays related to their shipments.Customs is not merely an agency that protects the revenue and commerce. It also acts as a frontline defender of our borders. Customs uses various law enforcement intelligence methods as well as random checks to designate for inspection shipments that may contain contraband or violative merchandise. Customs may delay or forestall the release of cargo from time to time in order to fulfill this function. The importer should be aware that their import shipment may be delayed for examination and allow for this possibility in their planning. Depending on circumstances, additional expenses may be incurred for the examination and transfer of cargo.The importer should bear in mind that a customs release is conditional, and that customs may demand redelivery of the cargo found later to be not legally marked, not entitled to admission, failure to comply with a request for samples, or other violation. To help ensure this does not happen, the importer should take reasonable care reasonable care to be familiar with the requirements for compliance and the specific requirements for their prospective shipment(s) in advance.
Duties, Taxes & Fees
They are normally payable within ten customs business days of the release date, along with submission of the entry summary document. The customs duty may be paid via check or ACH (electronic payment). Customs brokers are required to notify their clients:
If you are the importer of record, payment to the broker will not relieve you of liability for customs charges (duties, taxes, or other debts owed customs) in the event the charges are not paid by the broker. Therefore, if you pay by check, customs charges may be paid with a separate check payable to the “U.S. Customs Service” which shall be delivered to customs by the broker.
It is then in the best interest of the importer to make separate payment in the case of duty liability, particularly for large amounts. ACH is an excellent, cost-effective method of payment.
Following customs release and duty payment, the entry remains in an ‘open’ status with customs, pending final review and liquidation. An entry is liquidated when customs has made final determination as to the classification, appraisal and other relevant issues, thereby ‘closing’ the file. Following liquidation, a courtesy notice of liquidation is issued by mail to the importer, notifying them of the final status. It is important for importers to retain these notices and track the status of their entries. The importer should examine the notice to verify that the entered duty liability matches the liquidated duty liability, ie. that there was no change.An entry which has not liquidated within a normal time period (normally within one year) may need follow-up with customs. Entry liquidation may be suspended or extended for pending or unresolved issues. It is in the importers best interest to be aware of the liquidation status of their entries.
All goods of foreign origin imported into the United States, with some exceptions are required to be marked conspicuously, legibly, indelibly and permanently with name of the country of origin in English. Penalties to include a 10% marking duty or seizure, among others may accrue or be imposed for failure to import properly marked articles.In some instances, customs may allow an importer to mark their goods after customs release. Importers are strongly advised to verify with their shippers and/or sellers that goods destined for export to the United States are properly marked beforehand.
Generally speaking, importers and exporters are required to retain any records pertaining to their shipments for five years. The Modernization Act provides for very stiff penalties for failure to provide requested records, as well as a voluntary compliance program to provide a cushion for any such fines. The final regulations are still being written. It behooves the importer and exporter to establish a logical methodology for filing and retrieval of these necessary records.
The usual entry is a consumption entry, meaning the goods released from customs custody enter the commerce of the United States for consumption. Importers may in some instances make temporary entries, entries into bonded warehouses and free trade zone entries among others.Additionally, some goods are subject to special entry requirements, such as quota, anti- dumping, countervailing duty among others.