The Internet has made it easy for many small businesses or individuals to purchase products and services at competitive prices from anywhere around the world. The opportunity to have direct access to fine products and items not commonly found in the local market is a very attractive proposition for the local corner store or a small-scale manufacturer.
In a short period of time the purchased item can be readily available for consumption, manufacturing or resale.
Nonetheless, many Internet purchasing enthusiasts lose sight of the requirements if the items are bought from an international vendor. When goods move from any foreign country to the United States, they are being IMPORTED. There are specific rules and regulations that govern the act of importing — and they can be extremely complex and confusing and costly.
U.S. Customs and Border Protection (CBP) has the responsibility of facilitating legitimate trade throughout the nation while enforcing U.S. trade laws that protect the economy, the health and the safety of the American people. Within its purview CBP ensures that imported products used or new, pay the proper rate of duty as well as comply with whatever rules and regulations govern the importation of that particular product into the United States.
It is important for small business to be aware that when goods are purchased from foreign sources, they become importers and are responsible for assuring that the goods comply with a variety of both state and federal government import regulations.
Importing goods that are unsafe, that fail to meet health code requirements, or that violate quota restrictions could end up costing you quite a bit of money in fines and penalties. At the very least, such goods would be detained, and possibly destroyed, by CBP.
Before making any purchase from a foreign source, keep in mind the following questions:
- Can the goods be legally imported? Are there restrictions on, or special forms required, for your purchase’s importation?
- Are you buying the item(s) for your personal use or for commercial purposes?
- Will you be responsible for shipping costs? If so, you should discuss with the seller how your purchase will be shipped. The choices are freight, courier service or international postal service. If you’re not careful, transportation and handling costs could far outweigh the cost of your purchase. Sometimes, the seemingly cheaper methods can be more expensive in the long run because they are more susceptible to theft, mis-deliveries and logistical problems.
- You should discuss with the seller what the exact delivery arrangements will be. If the seller does not make arrangements for postal or door-to-door delivery, you will either need to hire a customs broker to clear your goods and forward them on to you, or go the port of entry and clear them yourself.
- Can you trust the seller to provide accurate information about the item being shipped in the Customs section of the shipping documents? Giving misleading or inaccurate information about the nature of the item and its value is illegal. And it is the importer — YOU — who could face legal action and fines for this violation!
Goods imported for commercial purposes must comply with a variety of special requirements, which vary depending upon the particular commodity. You should ask the seller to provide the following information, whether or not it is asked for in the paperwork.
- Seller’s name and address. Description of the item(s) in English (a legal requirement )
- Quantity of each type of item being shipped
- Purchase price in U.S. dollars
- Weight of the item(s).
- Country of origin
If your goods are valued at more than $2,000, or for commercial textile shipments (clothes/materials) regardless of value, you will be required to file a formal entry, which can require extensive paperwork and the filing of a U.S. Customs and Border Protection bond. As mentioned above and for various reasons, CBP may require a formal entry for any importation.
You should not be misled into thinking your purchase price includes duty because the seller cannot say with absolute certainty what the duty will be. As a rule, a purchase price that includes shipping and handling does not include duty or any costs associated with clearing the goods through CBP.
First-time importers are often surprised by bills they receive for duty, U.S. Customs and Border Protection merchandise processing fee, and something referred to as “customs fees,” which are actually charges for the services of the broker who cleared your goods through CBP.
You can get further information at CBP’s web site at http://www.cbp.gov and check the Trade section on Basic Importing and Exporting or with the Informed Compliance Publications. You may also contact the CBP INFO Center at http://help.cbp.gov/app/home or call 1-877-CBP-5511