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APRIL 2015
Bringing Your Products to the United States: Cross-Border Logistics and Local Warehousing
UKTI Trade Services
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Contents Introduction 2 Pre-Shipping Considerations 3 Method of Shipping 3 Packing Requirements 5 Marking and Labelling 6 Insurance 6 Shipping your Products to the United States 8 International Shipping Flow Chart 8 Finding a Freight Forwarder 9 Freight Forwarder Checklist 10 Solutions for Local Warehousing 11 Third-Party Logistics Providers 11 Bonded Warehouses 13 Incoterms 13 The Entry of Goods into the United States 16 Parties Involved 16 The Entry Process 22 Tariff Classification and Valuation 27
List of Vetted Partners 29 Next Steps 37
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Introduction
Logistics and supply-chain planning is essential to your company’s success in the US market. Due
to the cost, complexities, and uncertainties of moving goods across borders, both small and large
companies rely on the skills and technology of logistics partners to gain a competitive edge. Logistics
partners can make it easier to navigate international transportation, US customs, and compliance
requirements, and they can help you achieve multi-location distribution. It is important that you check
their credentials and their ability to answer your specific needs before making the decision to
outsource.
This practical guide offers a comprehensive overview of the key considerations when bringing your
products to the United States: pre-shipping considerations, Incoterms, the US customs process, and
solutions for local warehousing. It also provides guidelines on how to identify and select customs
brokers and third-party logistics providers.
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Pre-Shipping Considerations
Method of Shipping
UK-based exporters can arrange their own shipping, use express delivery or mail services (such as DHL,
UPS, FedEx) or rely on freight forwarders to act as their shipping agents and move the goods from one
destination to another most efficiently.
A freight forwarder advises on whether your products should be shipped by sea or air. There are many things
to consider when selecting a method of shipping and specifying the handling of your shipment.
The important factors when determining the method of international shipping include:
The cost of the shipment
The delivery schedule
The accessibility to the shipped product by the foreign buyer
Since carriers are often used for large and bulky shipments, the exporter should reserve space on the carrier
well before the actual shipment date.
Sea Freight Container Size
Less-than-Container Load (LCL)
When you don't have enough cargo for a full container, you need a less-than-container-load (LCL) service,
which consolidates cargo and gets your shipment moving without delay.
Length: 19’4, 5.89 metres
Width: 7’8, 2.35 metres
Height: 7’10, 2.39 metres
Full Container Load (FCL)
When you have enough cargo for a full container, you need to book your shipment as FCL and depending
on the volume and weight, there are 3 sizes of containers you can pick: 20’ DRY (15 to 30 cbm), 40’ DRY
(31 to 60 cbm), 40’ HQ (61 to 70 cbm).
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Length: 19'4 5.89 m
Width: 7'8 2.35 m
Height: 7'10 2.39 m
Length: 39'5 12.03 m
Width: 7'8 2.35 m
Height : 7'10 2.39 m
Freight Ratio
Two main factors affect the final cost of a shipment: the weight and the volume occupied. In the field of
transport and logistics the parameter to be used to calculate the rates is the weight / volume ratio, different
for each type of transport (air, sea, land).
W/M is the acronym for Weight or Measurement commonly used in international and domestic cargo
transportation industries. The freight charges will be based on whichever is greater, weight or volume. W/M
presents cargo density limit (e.g. light cargo is charged based on measure, while heavy cargo is based on
weight). W/M may differ among carriers.
AIRFREIGHT
1 W/M = 1cbm = 167 kgs
Example: 3 pallets @ 100 x 120 x150 cm ; Gross Weight 600 kg, total volume 5.4 cbm Volume Ratio: 5.4 x 1000 / 6 = 900 kg Chargeable Weight will be: 900 kg because here Volume Ratio > Gross Weight
Length: 39'5 12.03m
Width : 7'8 2.35 m
Height: 8'10 2.69 m
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SEAFREIGHT
Unlike with a parcel service or airfreight, international LCL ocean freight rates are primarily based on the
volume, not on the weight of cargo.
1 W/M = 1 cbm = 1000 kgs = 1 ton
Example: 3 pallets @ 100 x 120 x150 cm ; Gross Weight 600 kg, total volume 5.4 cbm W/M will be: 5.4 cbm > 0.6 ton, therefore we have 5.4 as chargeable Weight/Measure A minimum of 1 W/M always applies
Packing Requirements
When choosing packaging materials for international shipping, exporters should be aware of four potential
problems:
Breakage
Cargo is carried in containers or sometimes shipped as break-bulk cargo. Break-bulk shipment is
subject to further handling that can result in potential damage on the package. While in transit, goods
may be stacked on top of or come into forceful contact with other goods.
Moisture
Condensation may develop in the hold of a ship even if it is equipped with air conditioning and a
dehumidifier. Cargo may also be unloaded in bad weather conditions.
Theft and Pilferage
Excess Weight
Transportation costs are determined by volume and weight.
Tips on product packaging for overseas transport:
Pack in strong containers, adequately sealed and filled when possible. Make sure the weight is evenly distributed. Goods should be palletised and when possible containerised. Packages and packing filler should be made of moisture-resistant material. To avoid pilferage, avoid writing contents or brand names on packages. Other safeguards include
using straps, seals, and shrink wrapping. Observe any product-specific hazardous materials packing requirements Use specially reinforced and lightweight packing materials
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Marking and Labelling
Freight forwarders and export packing specialists can supply the necessary information regarding specific
regulations. US buyers also often specify packaging requirements and which export marks should appear on
the cargo for easy identification.
Examples of marking requirements include:
Shipper's mark
Country of origin
Port of entry
Weight marking (in kilograms and in pounds, gross and net weight)
Number of packages and size of cases (in centimetres and inches)
Handling marks
Special handling instructions
Labels for hazardous materials
Ingredients (if applicable)
Shipping Insurance
Damaging weather conditions, rough handling by carriers, and other common hazards to cargo
make insurance an important form of protection for UK exporters.
Two shipping terms (Incoterms) require the UK exporter to take out insurance for the benefit of the buyer: CIF
– Cost, Insurance and Freight, and CIP – Carriage and Insurance Paid.
An exporter should either obtain its own policy or insure the cargo under a freight forwarder's policy for a fee.
Shipments by sea are covered by marine cargo insurance; air shipments may also be covered by marine
cargo insurance or insurance may be purchased from the air carrier.
Ad Valorem Cargo Insurance ("Insurance for the Value") covers the goods against the risk and loss or
damage. The Insured Value is based on the value of the cargo including costs, charges, and profit (maximum
20%).
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The Ad Valorem "All Risks" Insurance provides several benefits, which include:
Protection throughout the transportation process from warehouse to warehouse (Example: works to
final delivery), and whatever means of transport: marine, air, road, rail.
Full reimbursement of the value of the goods in the event of a disaster or loss
Compensation beyond the liability limits that appears in international agreement and / or national
laws
Protection of goods in the event of General Average
Some coverage exceptions include:
Concealed damages
Packaging failure
Particular nature of the goods such as live animals, art works, etc.
Indirect damages (the consequence of delay)
Didier Vanderperre, Managing Director at Clasquin USA
“Binding insurance coverage against damage and theft for your cargo while in transit is a
must. Despite obtaining insurance via your freight forwarder or your insurance broker, this
does not automatically guarantee indemnification in case of a loss. It remains the
responsibility of the shipper to properly pack his goods, so they can arrive in good condition
at destination. Any shipment that is deemed insufficiently packed by an insurance surveyor
would void insurance coverage in case of a claim. Concealed damages to a shipment are
the number one cause of insurance claim denial. In addition to insuring the value of its
goods, the shipper must also include the cost of shipping and Customs duties in the declared
value for insurance.”
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Shipping your Products to the United States
International Shipping Flow Chart
On-site
Distribution
Pick-up
Receiving
Warehousing
Order
Preparation
Documentation Air & Sea
Freight
U.S. Customs
Clearance
Storage
Consolidation
Containerisation
Break Bulk
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Finding a Freight Forwarder
Many exporters utilise a freight forwarder to act as their shipping agent to comply with export documentation
and shipping requirements. The freight forwarder is often called the “Architect of Transport” as it can move
cargo from “dock-to-door” efficiently and provide several significant services such as:
In the US, export freight forwarders are both small and large companies that have been licensed by the
International Air Transport Association (IATA: www.iata.org) to handle airfreight and the Federal Maritime
Commission (FMC: www.fmc.gov) to handle ocean freight.
Several sources can be used by UK exporters to find an international freight forwarder:
List of vetted partners (see Appendix)
National Customs Broker and Forwarders Association of America: http://www.ncbfaa.org
International Federation of Freight Forwarders Associations: http://fiata.com
International Air Transport Association: http://www.iata.org
Directory of Airfreight Forwarders: http://www.inboundlogistics.com/cms/search-tool/air/
Role of the Freight Forwarder
Advising on exporting costs including freight costs, port charges, consular fees, costs
of special documentation, insurance costs and freight handling fees
Advising on the most appropriate mode of cargo transport and making arrangements
to pack and load the cargo
Reserving the necessary cargo space on a vessel, aircraft, train, or truck
Assistance in preparing and filing required export documentation such as the bill of
lading and routing appropriate documents to the seller, the buyer, or a paying bank
Making arrangements with overseas customs brokers or using the services of an in-
house customs broker to ensure that the goods and documents comply with US
Customs Regulations
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Freight Forwarder Checklist
Several criteria should be used to determine if the freight forwarder you select is appropriate for your type of
product and the shipping destination.
Due-Diligence Checklist
Does your freight forwarder:
Have an office near your shipping port?
Have experience handling your type of product and shipping to your market?
Have experience with the type of carriers you require?
Have a good credit rating?
Have favourable shipping rates and delivery schedules?
Receive good recommendations from carriers?
Belong to a professional association or organisation?
Have expertise shipping to the US?
Have a reputation for friendliness, competence, efficiency, reliability, cost-effectiveness, trustworthiness, and using fair business practices?
Is the forwarder bonded and licensed by the Federal Maritime Commission or Cargo Network
Services?
Freight Forwarder Fees
For the most part, freight forwarders are independent businesses with competitive rates and services.
It is recommended that you request quotes from several forwarders to compare pricing in the industry.
Fees for freight forwarders can fluctuate with the value of shipment, subject to negotiations and commissions on freight rates.
Find out what services are free of charge and find out what the fees are for preparing documents such as pro forma invoices, commercial invoices, and packing lists.
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Solutions for Local Warehousing The warehouse plays a critical role in customer order fulfilment. Having warehouses conveniently located in
the United States means that a company can get its products to the customer as quickly as possible in the
most efficient way. Whether you decide to sell through e-commerce and use an Amazon fulfilment centre
(FBA), sell directly to big-box retailers such as Walmart or Home Depot, or work with an in-market
representative, you will need a US warehouse.
Third-Party Logistics Providers (3PL)
Freight forwarders move cargo from one point to another. Third-party logistics companies facilitate the
movement of finished products to distributors, retailers, and direct-to-consumers. Among the services
provided are warehousing, cross-docking, inventory management, packaging, and labelling. They may also
offer freight forwarding services. Some 3PLs will specialise in certain industries, frozen food for example.
Others might specialise in one specific area of logistics such as auditing freight bills, warehousing or providing
logistics related software.
Third-Party Logistics companies may use three different business models:
Asset based 3PLs own physical assets like warehouses, planes, trucks, etc.
Non-Asset based 3PLs buy or broker the assets from other transportation or logistics companies.
Asset Light 3PLs both own physical assets and partner with other logistics companies similar to non-
asset based companies.
How are 3PL Companies different from Importers and Distributors?
3PLs do not take ownership of the product. Also, 3PLs do not typically assist with importing. When using a
3PL, the supplier is responsible for getting the goods to the 3PL warehouse for stock or cross-docking. 3PLs
do not provide sales or marketing services. 3PLs specialise in logistics management. Importers/distributors
purchase the product and manage the sales.
Who uses 3PL’s in the USA?
Over 70% of America’s largest consumer product companies outsource some or all of their supply chain
management through 3PLs. 3PLs are well-suited for most consumer products such as clothing, cosmetics,
giftware, homeware, toys, and other household items sold by US retailers.
How much does it cost to work with a 3PL?
The cost of working with 3PL’s is typically much less expensive than distributing goods through an
importer/distributor. The cost of services provided through 3PLs typically ranges from 2–15% of sales
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depending upon volume and services required. In the US, an importer/distributor will generally require from
30% – 70% margin on products sold through their company.
What are some of the other benefits of distributing through a 3PL in the US?
3PL providers can easily help with understanding and tackling the complicated shipping requirements of many
of the mid-size and larger US retailers. In addition, some 3PL providers offer EDI (electronic data
interchange), bookkeeping and other administrative services for a fraction of the cost to set up these services
independently. Also shipping from a US location will make your products more attractive to US retail buyers
as many retailers prefer not to deal with direct import merchandise. Retailers often pay the freight from a US-
based warehouse to their distribution centre or store so there could also be savings associated with US
domestic freight.
Does my company need to be registered or licensed in the US to work with a 3PL?
No, not every 3PL requires their clients to be a registered US company but some may have this as a
requirement. Be sure to ask if the 3PL has worked with overseas businesses in the past. Also, be sure to
select a 3PL that is familiar with your industry and is located near a convenient US port for your shipments,
and ask about minimum requirements.
What are some of the types of services that 3PL warehouses can provide?
There is a large variety of services offered by 3PLs. Consider who you are targeting for your sales (types of
retailer or direct to consumer) and what you want to ship before signing a contract. Request all service costs
in writing. Some considerations, for instance, include shipping direct to consumer web sales or large bulk
orders to retailers. Do you want to cross-dock some orders (pre-packaged overseas and shipped through the
3PL), or will you be holding all stock in the warehouse and sending through requests to pick up orders?
What products are not suitable for 3PL warehousing?
Although many consumer products are ideal for 3PLs there are some that are not appropriate. These include
products that contain alcohol and some food products. Primarily alcoholic beverage and certain food retailers
still rely heavily upon the traditional importer/distributor model for purchasing.
What do I do to prepare to look for an appropriate 3PL in the USA?
Develop a company strategy in terms of identifying who will be working with the overseas warehouse within
your business and involve them in the process. Clearly define your expectations of what will work best for
your business.
Where to find a 3PL provider?
List of vetted partners (see Appendix)
International Warehouse Logistics Association : http://www.iwla.com
Inbound Logistics top 100 3PLs: http://www.inboundlogistics.com/cms/top-100-3pls/
Food Logistics Top 3 PL providers and cold storage: http://media.cygnus.com/files/base/FL/document/2014/08/FLOG_3PL_Chart_1-pg.pdf
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Bonded Warehouses
A Customs bonded warehouse is a building or another secure area in which imported dutiable merchandise
may be stored, manipulated, or undergo manufacturing operations without payment of duty for up to 5 years
from the date of importation.
Advantages
Duty is not collected until the merchandise is withdrawn for consumption. An importer, therefore, has control
over use of his money until the duty is paid upon withdrawal of the merchandise. If no domestic buyer is found
for the imported articles, the importer can sell merchandise for exportation, thereby eliminating his obligation
to pay duty.
Many items subject to restrictions may be stored in a bonded warehouse. It is important to check with the
nearest CBP office before assuming that such merchandise may be placed in a bonded warehouse. Duties
owed on articles that have been manipulated are determined at the time of withdrawal from the bonded
warehouse.
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Incoterms
“Incoterms” (International Commercial Terms) are a set of rules which define the responsibilities of sellers
(exporters) and buyers for the delivery of goods under sales contracts for domestic and international trade.
They are published by the International Chamber of Commerce (ICC) and are widely used in international
commercial transactions.
Incoterms 2010 are organised by mean of transport.
The following Incoterms apply to any mode of transport:
EXW Ex Works
FCA Free Carrier
CPT Carriage Paid To
CIP Carriage and Insurance Paid To
DAT Delivered at Terminal
DAP Delivered at Place
DDP Delivered Duty Paid
The Incoterms that apply to sea and inland waterway transport only are:
FAS Free Alongside Ship
FOB Free on Board
CFR Cost and Freight
CIF Cost, Insurance, and Freight
Incoterms specify the exporting seller's and importing buyer's obligations regarding carriage, risk, and costs,
as well as establishing basic transport and delivery terms. Incoterms only define contractual rights for risk
and responsibility. Both the buyer and seller must separately specify where ownership and title transfer (in
the sales contract).
The US Incoterms published by the Uniform Commercial Code (UCC) may differ
from the Incoterms published by the ICC. Therefore, in the sales contract it is
crucial to stipulate which frame of reference you would be using (i.e. "Incoterm
FOB New York, International Chamber of Commerce Incoterms").
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US In-Market
Representative
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The Entry of Goods into the United States
Parties Involved in the Import Process
The Importer of Record
The Importer of Record is the party responsible for clearing the goods through US Customs Border and
Protection. It can be the owner of the goods that are being imported, the purchaser or a licensed Customs
broker designated by the owner, purchaser or consignee.
When a shipment reaches the US, it is the importer of record’s responsibility to file entry documents for the
goods at one of the 325 ports of entry, and to arrange for the examination and the release of the goods. Only
the Importer of Record has a right to make entry of goods. In making entry, the Importer of Record must
show “reasonable care”.
The term “entry” refers to the documents filed by the importer with CBP, and the process of “making entry” is
the main connection between importers and CBP. The “entry package” will form CBP’s basis to evaluate the
importer’s use of reasonable care and CBP’s assessment of legal liability related to the entry.
A foreign company with no presence in the US must have an agent in the state where the port of entry is
located that serves as resident agent in the US on behalf of the foreign corporation's behalf. For instance, a
Customs Broker that has been named in a Customs and Border Protection's power of attorney may make
entry on behalf of the exporter or his/her representative.
Importer of Record
Customs Broker
Insurance Company
Customs and
Border Protection
(CBP)
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What is Reasonable Care?
The Customs Modernisation Act (also known as The Mod Act) altered the relationship between CBP and
importers, by shifting to the importer the legal responsibility for declaring the value, classification, and rate of
duty applicable to entered merchandise. The relationship between the two parties is characterised by Informed
Compliance. CBP still has the obligation to inform importers of how they should comply with Customs laws,
and assist them in evaluating the Reasonable Care requirements through “Informed Compliance” publications
(brochure and advisory opinions). Importers are expected to consult these resources as part of their
“Reasonable Care” obligations.
The Customs Broker
There is no legal requirement for UK companies to hire a Customs Broker to clear their goods. However, due
to the complexity of the US Customs regime, many importers opt to do so for the convenience. The importer
is always ultimately responsible for knowing CBP requirements and for ensuring their importation complies
with all federal rules and regulations, but using a Customs Broker can save you from making costly mistakes.
Customs Brokers are licensed by U.S. Customs and Border Protection to conduct CBP business on behalf of
importers who do not want to handle the various technicalities that are involved in importing themselves. They
take the burden of filling out paperwork and obtaining a CBP bond off of the importer's hands. If your goods
are being imported via an express courier such as DHL or FedEx, the courier automatically utilises Customs
Brokers to clear your goods on your behalf.
Responsibilities of the Importer of Record
Ensure all paperwork is submitted to CBP (e.g. Commercial Invoice, licenses, etc.) whether you
are a self-filer or through a customs broker
Value (generally the transaction value, the purchase price of the goods, transfer price if it is an
inter-company transfer)
Correct quantity
Country of Origin/Certificate of Origin (if applicable)
Assignment of the correct Harmonized Tariff Schedule (HTS)
Provide accurate description to customs
Any other government agency (OGA) documents
Payment of duties and fees to U.S. customs
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A Customs Broker must have a Power of Attorney in place to perform Customs business on behalf of another party.
CBP provides a form of power of attorney which can be used by foreign corporations:
How to Identify and Select your Customs Broker
List of vetted partners (see Appendix)
NCBFAA: National Customs Brokers and
Forwarders Association of America;
www.ncbfaa.org
IFCBA: International Federation of Customs
Brokers Associations; http://ifcba.org/
Role of the Customs Broker
Ensure all paperwork is submitted to CBP (e.g. Commercial Invoice, licenses, etc.)
Conduct customs activities involving transactions with CBP included
Entry of merchandise
Advise on classification and valuation (if requested)
Payment of duties, taxes and fees (if requested), you can arrange to have your customs broker
pay for you and reimburse
Refund, rebate or drawback of duties, taxes, or other charges
Preparation of electronic transmission of CBP documents (e.g. 3461, 7501, etc.)
Submit corrections to your entries
Theresa Sekula, Regulatory Compliance Manager at BDP International
“A broker is not allowed to classify or provide valuation instead of an importer. The role
of the broker would only be to provide advice to an importer on how to do these
functions. Importer is ultimately responsible for this information. If an importer chooses
to elect a broker to complete for them, the importer is still responsible. This is important
to understand where risk lies, especially for new importers.”
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Guidelines for Choosing a Customs Broker
There is a great number of Customs brokers from large well-established firms to one-man shops. While
communication is the key to success along with patience and a positive outlook, you want to ensure that the
Customs broker you choose understands your company, the import/export requirements, and has the
capabilities to perform what is expected of them. The guidelines below should help you narrow down the
choices and select the best Customs broker for your products.
Choose a Customs broker who has experience in your niche or industry (food, cosmetics,
automobile, textiles, etc.) rather than a generalised broker. He or she will be much more helpful in
giving you advice on your classification, recognising wrong classifications or incorrect valuation,
identifying which specific regulations apply to your products, and which other governmental agencies
are involved.
Choose a broker who can provide positive references such as testimonials from previous clients
or ask a third-party source for opinions and reviews. The two trade associations, NCBFAA or the
IFCBA, that represent qualified and trustworthy Customs brokers might assist you in this matter.
Ensure that the broker has locations at all of your ports of imports and can file remotely.
Ensure that your broker has technical capabilities and is completely connected to the computer
systems, portals and tracking sites that your operation will depend on such as ERP system and carrier
systems). Choose a broker who participates in the Automated Broker Interface (ABI), which allows
qualified participants to electronically file required import data with Customs.
Ensure that the broker can dedicate resources to your account, especially if you are working with
a large volume of goods.
Carefully review charges for entries. Brokers will usually charge a fee for each line item and each
commercial invoice they have to enter in the ABI, as well as other fees if you are working with other
governmental organisations. Other fees may include file copy fees, classification fees and examination
fees.
Compare at least a few different options. You should compare pricing, experience, specialisation,
resources, etc.
Many well-managed companies also turn to an experienced law firm with Customs law expertise for help
in structuring their transactions and for strategic advice. As Customs duties are a type of tax, there are many
planning opportunities which should be explored. Due to the close attention by the US government to the
importer’s compliance obligations, the skilled attorney can also work closely with the importer and the broker
and guide the importer through the entire process.
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Insurance Company
If you are importing merchandise into the U.S. for commercial purposes that are valued over $2,500, or a
commodity subject to other federal agencies’ requirements (e.g. firearms or food), you must post a Customs
bond to ensure that all duties, taxes and fees owed to the federal government will be paid. If the Importer of
Record uses a Customs broker to clear the goods through CBP, the broker's bond may be used to secure the
transaction. You have the option of obtaining a "single entry" or "continuous bond".
If you only import on occasion, the single entry bond is recommended; if you import frequently and through
various ports of entry, the continuous bond is beneficial and economically the best choice.
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Customs and Border Protection (CBP)
The CBP was set up in 2003 and focuses on security, compliance and revenue. Customs duties are the
revenues lifted by CBP. Every entry of goods is accompanied by the filing of Customs entries (CF 7501 form).
Some items require a license or permit from various government agencies in order to be imported. Examples:
food products ordered from a commercial vendor, plant, animal and dairy products, prescription medications,
trademarked articles such as name-brand shoes, handbags, luggage, golf clubs, toys, etc. and copyrighted
material such as CDs, DVDs and tapes.
CBP has been entrusted with enforcing hundreds of laws for 40 other government agencies, such as the U.S.
Fish and Wildlife Service, the U.S. Department of Agriculture and the Centres for Disease Control and
Prevention. These agencies require that unsafe items are not allowed to enter the United States. CBP officers
are always at ports of entry and assume the responsibility of protecting the US from all threats.
There are 325 ports of entry in the United States: For a detailed listing of ports of entry, please refer to:
http://www.cbp.gov/contact/ports
Role of CBP
Controls, regulates, and facilitates the movement of carriers, people, and commodities between
the United States and other countries
Protects consumers and the environment against hazardous, toxic or noxious products
Protects domestic industry and labour against unfair foreign competition (anti-dumping laws)
Detects, bans and investigates smuggling and other illegal practices aimed at illegally entering
narcotics, contraband or other prohibited articles
Detects, bans and investigates fraudulent activities intended to avoid payment of duties, taxes
and fees
Detects, interdicts and investigates illegal international trafficking in arms and munitions, currency
and acts of terrorism at U.S. ports of entry
CBP acts as the enforcement arm for over 40 government agencies
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Participating Government Agencies
There are over 40 federal agencies whose laws CBP helps to enforce. Examples include:
U.S. Department of Agriculture Agricultural Marketing Service Washington, DC 20250 Tel. 202.720.8998 www.ams.usda.gov U.S. Consumer Product Safety Commission Office of Compliance 4330 East West Highway Bethesda, MD 20814 Tel. 301.504.0608 www.cpsc.gov Environmental Protection Agency Hazardous Materials Hotline 1.800.424.9346 TSCA Assistance Information Service Tel. 202.554.1404 Motor Vehicles Investigation/lmports Section 2000 Traverwood Drive Ann Arbor, MI 48105 Attn: Imports Division Tel. 734.214.4100 http://www.epa.gov
U.S. Department of Transportation National Highway Traffic Safety Administration Office of Vehicle Safety Compliance 400 7th Street SW Washington, DC 20590 Tel. 1-800-424-9393 www.nhtsa.dot.gov Office of Hazardous Materials 400 7th Street SW Washington, DC 20590-0001 Tel. 202.366.4488 http://phmsa.dot.gov/
U.S. Department of the Treasury Alcohol and Tobacco Tax and Trade Bureau Washington, DC 20220 Tel. 1.877.882.3277 Email: [email protected] (alcohol importer’s basic permit, alcohol excise taxes) [email protected] (alcohol labelling, advertising, and formulation) [email protected] (tobacco products) [email protected] (firearms and ammunition excise tax) Main Website: www.ttb.gov U.S. Department of Health and Human Services Food and Drug Administration Centre for Biologics Evaluation and Research 1401 Rockville Pike Suite 200 North Rockville, MD 20852 Tel. 301.827.6201 www.fda.gov/cber Centre for Drug Evaluation and Research 7520 Standish Place Rockville, MD 20855 Tel. 301.594.3150 www.fda.gov/cber Centre for Devices and Radiological Health Rockville, MD 20850 Tel. 301.594.4692 www.fda.gov/cber Division of Import Operations and Policy 5600 Fishers Lane Rockville, MD 20857 Tel. 301.443.6553 www.fda.gov/ora/import
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The Entry Process
Entering merchandise is a two-part process consisting of:
1) Filing an entry package containing the documents necessary to determine whether merchandise may
be released from CBP custody.
2) Filing the entry summary, which contains the information for duty assessment and statistical purposes.
There is an extra step that needs to be taken if the goods are being shipped through ocean freight – the filing
of the ISF (Importer Security Filing), also called “10+2”. The ISF must be submitted to CBP no later than 24
hours prior to the cargo being loaded on the vessel destined for the United States. In case of DDP shipments
(Delivered Duty Paid), the supplier is the ISF Importer. More information can be found on the CBP website:
http://www.cbp.gov/border-security/ports-entry/cargo-security/importer-security-filing-102
The first step involves filing the entry documents to secure release of the imported goods. These documents
must be filed within 15 calendar days after the imported merchandise arrives at the US port of entry.
Importers often file the Entry Summary (and estimated import duties deposited) simultaneously with the entry.
It is possible to file these documents electronically by using the Automated Broker Interface (ABI) program of
the Automated Commercial System (ACS). Although US imports still involve paper documents, these
documents will soon be primarily available electronically.
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Entry Package filing
There are different types of entry options depending on the nature of your shipment (product being imported,
value of shipment, and purpose of import). For goods entering the U.S to be consumed, sold, or used, UK
companies need to file a consumption entry. There are two types of entry:
- Formal Entry for goods over $2500 in value and for goods for which a license or a permit issued by a federal agency is required
- Informal Entry for goods below the $2500 threshold
The entry documents must be filed within 15 calendar days after the merchandise arrives in the U.S. Find the formal entry documentation contents on the following page.
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An Entry Manifest (CBP Form 7533) or Application and Special Permit for Immediate Delivery (CBP
Form 3461) or other form of merchandise release required by the port of entry director. The entry
manifest is filled out by the freight forwarder or carrier.
A Bill of Lading, which is the evidence of the right to make entry or an Air Waybill for merchandise
arriving by air.
Evidence of an Import Bond (single entry or continuous): it guarantees the payment of the Customs
fees and duties. Bonds can be obtained through an insurance company or through the Customs
broker. As noted, surety bonds are required for formal entries.
The Commercial Invoice or Pro Forma Invoice containing the details of transaction and shipment:
value of the merchandise, quantity, description of the products, ship to, “sold by”.
A Packing List for CBP examination purposes. It shows what items are in the shipment and how they
are packed in each box.
A Certificate of Origin
Any other document required by Participating Government Agencies (such as the Food and Drug
Administration, the U.S. Department of Transportation, the Consumer Products and Safety
Commission, etc.) or Customs documents necessary to determine the merchandise admissibility.
Source: CPB website: http://www.cbp.gov/sites/default/files/documents/CBP%20Form%203461.pdf
Instructions for completing the Entry/Immediate Delivery 3461 form: http://www.cbp.gov/sites/default/files/documents/CBP%203461%20Instructions.pdf
Formal Entry Documentation
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In general, an informal entry involves the importation of merchandise that does not exceed $2,500 in value. They are used for personal and commercial importations.
Informal entries do not require a posting of a Customs bond and are liquidated at the time of release.
Documentation is less stringent than for formal entry. The shipment must have its commercial invoice with it. An entry summary (CBP Form 7501) must be presented in proper form, and estimated duties deposited within 10 days of the release of the merchandise under either the regular or alternative procedure described in this section.
Once the carrier bringing your goods to the U.S. has notified you of your goods arrival, the Importer of Record
should go to the entry branch of that port's Customs house and inform the staff that it has an informal entry to
process and pick-up.
If the goods are not picked up within 15 days of arrival, they will be sent to a General Order Warehouse (G.O.
Warehouse), and storage charges will apply. The intended recipient of the goods is responsible for paying
those charges. After 6 months in the G.O. Warehouse, goods may be sold at auction.
Section 321 is a type of Informal Entry that allows for the release at the border of shipments valued at 200
U.S. dollars or less. There has been some discussion about raising this threshold to $800.
Section 321: Entry type for low risk, low value shipment < $200, commonly
done in a courier environment. Shipments released as Section 321 are free of
duty and tax.
Informal Entry Documentation
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In addition to consumption entries, other entry types are used to clear goods entering the United States.
Some entry types include warehouse, transportation, temporary importation under bond (TIB),
permanent exhibition, trade fair, carnets, drawback, foreign trade zone (FTZ), vessel repair, and
appraisement of FTZ's entries.
Transportation entry is used if the goods are transiting through the U.S. to another country. Temporary Import
Bonds (TIB) are used for duty free entry of goods to be re-exported (known as “inward processing relief” in
the UK).
Entry Summary/Entry Documentation
Following the presentation of the entry and arrival of the goods into the United States, CBP has the right to
examine the goods. If the goods are released at the time of the filing of the entry or upon arrival, then the next
step is filing the “Entry Summary”.
This Entry Summary package consists of:
The entry package
The Customs “Entry Summary” form (Customs Form 7501, or “CF 7501”)
The CF 7501 is the key document for CBP’s purposes, and it includes the importer’s declarations as to the
classification, origin, and value of the imported merchandise. Failure to use “reasonable care” in completing
the CF 7501 may result in the assessment of penalties and/or delay in the release of the merchandise. A
sample CF 7501 can be found below. The Entry Summary must be filed with the duty payment within 10
working days after entry, if filed separate from entry documentation.
Other Entry Types
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Source: CBP website: http://www.cbp.gov/sites/default/files/documents/CBP%20Form%207501_0.pdf
Liquidation Process
Duties paid at the time of entry are referred to as duty “deposits,” because they are merely estimated payments
and not considered to be CBP’s final assessment of duties owed. The entry remains open, or “unliquidated”
for approximately 314 days (though this can be extended in certain circumstances) after the date of entry.
During this period, either the importer or CBP can review the entry information and revise the entry information
(value, classification, and origin, etc.). On or about day 314, the entry is finalised or “liquidated”.
Tariff Classification and Valuation
Goods imported into the United States must be assigned a tariff classification under the Harmonized Tariff
Schedule of the United States (HTSUS): http://hts.usitc.gov/
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Classification Code
To classify goods, please check the Table of Contents for the Harmonized Tariff Schedule:
https://www.gov.uk/trade-tariff/sections or call the Customs CLASSIFICATION HOTLINE Tel: 01702 366 077
TARIFF (UK), Mon-Fri 9.00 – 14.30
HTSUS Numbers
The Harmonized System (HS) assigns a 6-digit number to each product that is traded internationally. Each
country can assign, on its own, additional numbers. The HTSUS uses a 10-digit system, so a tariff
classification must be declared based to the 10th digit. The United States does this with its Schedule B system:
http://www.census.gov/foreign-trade/schedules/b/
Tariffs and Import Fees
Tariffs or Customs duties are an indirect tax levied by governments, typically on the value of products
imported from one country into another. Before you export to the US, you need to determine the tariff rate
on your product(s), a function of the tariff classification, as well as any import fees for that country.
Duty Rates: The United States International Trade Commission website http://dataweb.usitc.gov/ provides
international trade statistics and US Tariff data to the public full-time and free of charge. Here are the
directions for access:
1. Go to http://dataweb.usitc.gov/scripts/tariff_current.asp
2. Enter Classification number in the box and click ‘List Items’
3. Select the relevant listing and click ‘Detail’
4. The rate is quoted under MFN (Most Favoured Nation)
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Valuation
Proper Customs valuation is important because most duty rates are assessed as a percentage of the value
of an imported product, and total duty payments are thus determined by applying the applicable duty rate to
the product’s Customs value. For example, a 10% duty on a product whose value is $100.00 will yield a duty
of $10. In the US, Customs value typically equates to the importer’s FOB price for the goods.
Mark Neville, Customs and Trade Lawyer at International Trade Counsellors
“Transfer pricing refers to the valuation of goods in transactions where the buyer
and seller are related parties, such as parent and subsidiary. Both the customs
and income tax authorities are concerned that the price has not been influenced
by the relationship, i.e., that it is an “arm’s length price.” If you choose to make
use of a US affiliate as a buyer, you must be prepared to demonstrate that your
price meets that standard.”
32
.
Name Title Company Address Tel Email Website
Theresa Sekula
Regulatory
Compliance
Manager
Customs
Broker
BDP International Inc.
510 Walnut Street, 13th
Floor
Philadelphia, PA 19106
Office: +1 215
629 8210
Cell: +1 609
313 1373
www.bdpinternational.com
Didier Vanderperre
Managing Director
CLASQUIN USA Inc.
10 Fifth Street,
Suite 401,
Valley Stream, NY 11581
+ 1 516 823 0000
www.clasquin.com
Anja Chatzopoulos
Seafreight Import
Operations SDV USA Inc.
160 Chubb Avenue - Suite 306 Lyndhurst, NJ 07071
+1 201 636 5979
www.sdv.com
List of Vetted Freight Forwarders & Customs Brokers
33
Phil Hobson
Customs
Broker and President
PHOENIX LOGISTICS
1201 Corbin Street Elizabeth, NJ 07201
+1 908 403 0228
[email protected] www.phoenixlogistics.com
Michael Pelletier
Route Development
Manager DB SCHENKER
896 Frelinghuysen Ave,
Newark, NJ 07114
+1 973 954 2000 Ext. 6106
[email protected] www.dbschenkerusa.com
Alexandre Millet
Sales
Executive LOGFRET INC
6801 West Side Avenue, North Bergen, NJ 07047
+1 201 817 1142
[email protected] http://www.logfret.com/
34
Name Title Company Address Tel Email Website
Amy Frey President ATC
INTERNATIONAL
859 East
Sepulveda Blvd
Carson, CA
90745
+1 310 834
4800
[email protected] www.ATCInternational.net
Jim Gill Vice President
CALIFORNIA
CARTAGE
3545 Long
Beach
Boulevard, 5th
Floor Long
Beach, CA
90807
+1 310 537
1432
www.calcartage.com
Thomas
Campbell Chief Strategy Officer
CAPACITY LLC
1112 Corporate
Road North
Brunswick, NJ
08902
+1 732 745
7770
www.capacityLLC.com
Antonia Forstik President CONMAR INTERNATIONAL
1405 Route 18,
Suite 200 Old
Bridge, NJ
08857
+1 732 607
6415 [email protected] www.conmar-intl.com
List of Other Vetted Warehouses and 3PL providers
35
Ron Brinkman VP of Sales &
Marketing
DISTRIBUTION
ALTERNATIVES
435 Park Court
Lino Lakes, MN
55014
+1 651 636
9167 [email protected] www.daserv.com
Cindy Farley Sales Director ELM Global
Logistics
50 Emjay
Boulevard,
Suite 6
Brentwood,
NY11717
+1 631 233
3200, Ext. 222 [email protected]
www.elmlogistics.com
Robert Mack President EPAC, INC.
2561 Grant
Avenue San
Leandro, CA
94579
+1 510 317
7979 [email protected]
www.xlogistics.com
Patrick O’Leary
Lauren Helfer
President Marketing Manager
GREENWOOD
GROUP
4455 Genesee
Street
Cheektowaga,
NY 14225
+1 716 631 3003
[email protected] www.greenwoodg.com
Ed Trenery President
JET DISTRIBUTION
SERVICES, INC.
8101 Tonnelle
Avenue North
Bergen, NJ
07047
+1 201 440
5800
www.jetwhse.com
Steve Schuldt V.P. Finance
LA GROU
DISTRIBUTION
3514 South
Kostner
Avenue
Chicago, IL
60632
+1 773 579
1919 [email protected] www.lagrou.com
36
Michael Moran VP/ Sales Director
MORAN DISTRIBUTION SERVICES
1000 Estes
Avenue Elk
Grove Village,
IL 60007
+1 847 439 0000
www.morantransportation.c
om
Patrick Moulton Director of New Business Development
NUTRACEUTICAL
FULFILLMENT/MO
ULTON LOGISTICS
MANAGEMENT
7850 Ruffner
Avenue Van
Nuys, CA
91306
+1 818 997
1800, Ext. 156
www.moultonlogistics.com
Mike Kirby Director of Business Development N.E. Region
NFI INDUSTRIES, INC.
1515 Burnt Mill
Road Cherry
Hill, NJ 08003
+1 856 470
2008 [email protected] www.nfiindustries.com
Brian Olgun Director of Operations
NORVANCO
INTERNATIONAL
INC.
3514 142nd
Avenue East,
Suite 400
Sumner, WA
98390
+1 253 987
4000 [email protected]
www.norvanco.com
Larry Maneson
VP of Sales United Fulfillment
Solutions Inc
423 Bussen Underground Rd St. Louis, MO 63129
314-894-3200 ext.109
[email protected] www.unitedfsi.com
Mike Burns VP Global Sales and Marketing
OZBURN-HESSEY LOGISTICS, LLC
7101 Executive
Center Drive,
Suite 333
Brentwood, TN
37027
+1 615 401
6400 [email protected] www.ohl.com
37
Bob Schuman President RSS
ENTERPRISES
80 Triangle
Boulevard
Carlstadt, NJ
07072
+1 201 438
2250 [email protected] www.rssenterprises.com
Meyer Gross President
SEAJET
WAREHOUSING &
DISTRIBUTION
35 Brunswick
Avenue
Edison, NJ
08817
+1 732 541
4800, Ext. 2104 [email protected] www.sea-jet.com
Kevin Dooley National Accounts Manager
TIGHE
WAREHOUSE &
DISTRIBUTION,
INC.
481 Wildwood
Avenue
Woburn, MA
01801
+1 781 939
0925 [email protected] www.tighe-co.com
Philip Tinsley President THE WAREHOUSE
2704 Handley
Ederville Rd.
Fort Worth, TX
76118
+1 817 589
1812, Ext. 104 [email protected]
www.thewarehouseusa.co
m
Angelo Gibson Director of Operations
WERNER
ENTERPRISES,
INC.
14507 Frontier
Road Omaha,
NE 68138
+1 402 895
6640 [email protected] www.werner.com
Pedro Nevarez Sales Manager
SOUTH FLORIDA
LOGISTICS
SERVICES (SFLS)
2855 Le Jeune
Road, 4th Floor
Coral Gables,
FL 33134
+1 305 520
2448 [email protected] www.sfls.com
Elaine Kovacs Third Party Logistics Manager
VANGUARD LOGISTICS
300 Middlesex Avenue - Carteret, NJ 07008
+1 732 661
4165 [email protected]
http://www.vanguardlogistic
s.com
38
Erik Holck
PORT JERSEY LOGISTICS
4 South Middlesex Avenue - Monroe, NJ 08831
+1 732 853 5374
Adam Mook
Holly Rader
LPI
Compliance
Department
Manager
Imports
Manager
LOGISTICS PLUS
1406 Peach
Street
Erie, PA 16501
Adam: 814-464-
1722 Office
814-397-2576
Mobile
Holly: (814) 464-
1777 phone
(814) 460-9203
mobile
www.logisticsplus.net
Al Raffa
Vice President of Operations
SEAFRIGO
536 Dowd Avenue - Elizabeth, NJ 07201
+1 201 770 1143 Ext. 21
www.seafrigo.com
Larry Maneson
VP of Sales United Fulfillment
Solutions Inc
423 Bussen Underground Rd St. Louis, MO 63129
314-894-3200 ext.109
[email protected] www.unitedfsi.com
39
Trade and Customs Lawyers create business strategies that optimise savings through preferential trade programs and help exporters/importers reduce their costs of doing business effectively around the globe.
Name Title Company Address Tel Email Website
Mark Neville Principal
INTERNATIONAL TRADE COUNSELLORS
80 Midland Street Bridgeport, CT 06605 USA
+1 347 226 0238 +1 203 345 5643
[email protected] http://www.itctradelaw.com/
Helena Sullivan Partner
BARNES, RICHARDSON &
COLBUM, LLP
100 William Street Suite 305 New York, NY 10038
+1 212 725
0200, Ext. 119
http://www.barnesrichardson.com
Alan Goggins Partner
BARNES, RICHARDSON &
COLBUM, LLP
100 William Street Suite 305 New York, NY 10038
212-725-0200 [email protected] http://www.barnesrichardson.com
Legal Advisors
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Last Revision: April 2015
Next Steps
https://attendee.gotowebinar.com/recording/6680219597836020226
UKTI offers a range of services to UK companies to assist with market entry, including OMIS (Overseas Market Introduction Service). This fully customisable service can be tailored to a company‘s needs and can include market information, contacts, visit programmes, product launches and more. Timing is a key consideration: if you have a specific deadline, make contact with UKTI well in advance to start the discussion. A variety of factors affect the OMIS process – time of year, industry events, team capacity, etc. - and we want to ensure the best possible outcome for our clients. To start the discussion, or for specific information on timeframes and pricing, please contact [email protected],
the central coordination team for the US network, as a first step. Looking for more information? Please visit the USA country page on www.gov.uk/ukti to access our range of publications on doing business in the United States.
UK Trade & Investment (UKTI) is the Government department that helps UK-based companies succeed in the global economy. We also help overseas companies bring their high-quality investment to the UK's economy – acknowledged as Europe's best place from which to succeed in global business. UKTI offers expertise and contacts through its extensive network of specialists in the UK, and in British embassies and other diplomatic offices around the world. We provide companies with the tools they require to be competitive on the world stage. Whereas every effort has been made to ensure that the information given in this document is accurate, neither UKTI, nor its parent departments, (the department for Business Innovation & Skills and the Foreign and Commonwealth Office) accept liability for any errors, omissio ns or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned.
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