FAQ

What is a Customs broker and what functions does a Custom broker perform?

I hear the term informed compliance, what does this mean?

Informed compliance is a shared responsibility between CBP and the import community wherein CBP effectively communicates its requirements to the trade, and the people and businesses subject to those requirements conduct their regulated activities in accordance with U.S. laws and regulations. A key component of informed compliance is that the importer is expected to exercise reasonable care in his or her importing operations.

What is an import entry?

An import entry is the process of clearing an import shipment through Customs. This involves preparing the requisite import entry documentation, classifying the imported product, assigning a value to the imported product and paying all Customs duties and fees owed on the imported product.

What is the value limit for Section 321 entry and will duties apply?

A subcategory of informal entry, known as a “Section 321″ entry, will allow for the duty-free entry of a shipment valued at $200 or less that is imported by one person on one day, with minimal attendant documentation requirements. The term “Section 321″ is derived from this provision’s statutory source, 19 U.S.C. § 1321(a)(2)(C).

May textile items be imported under Section 321?

Yes, since 1995 US Customs and Border Protection have permitted the importation of textile products under the statutory provisions of section 321.

Are FDA regulated products restricted under section 321?

Not under all circumstances, for example, ACE e-Manifest provides for the importation of certain FDA controlled products which are not ingestible by humans or animals.

What is involved in classifying an imported product?

Classifying an imported product involves the categorization of the imported product according to the Harmonized Tariff Schedule of the U.S. (HTSUS).

What is the Harmonized Tariff Schedule of the U.S.?

The Harmonized Tariff Schedule of the United States (HTSUS) is a system of tariff classification in use in the United States. The HTSUS comprises part of a uniform system of tariff classification used by major trading partners throughout the world. Goods are classified for the purpose of calculating the appropriate import duties.

What is involved in appraising or establishing the proper value an imported product?

Appraising an imported product involves assigning a value to a product for duty and calculation purposes.

Which value is most commonly used in appraising imported goods?

The value most commonly used in appraising imported goods is the transaction value of the imported goods, i.e., the total price actually paid or payable for the merchandise when sold for exportation to the U.S. plus amounts for the following if not included on the price:

• packing costs
• certain inland freight costs
• sales commissions
• royalties and license fees
• assists

What is a bonded warehouse and how can this benefit an importer?

If one wishes to postpone release of the goods, they may be placed in a CBP bonded warehouse under a warehouse entry. The goods may remain in the bonded warehouse up to five years from the date of importation. At any time during that period, warehoused goods may be re-exported without paying duty, or they may be withdrawn for consumption upon paying duty at the duty rate in effect on the date of withdrawal. If the goods are destroyed under CBP supervision, no duty is payable. While the goods are in the bonded warehouse, they may, under CBP supervision, be manipulated by cleaning, sorting, repacking, or otherwise changing their condition by processes that do not amount to manufacturing. After manipulation, and within the warehousing period, the goods may be exported without the payment of duty, or they may be withdrawn for consumption upon payment of duty at the rate applicable to thegoods in their manipulated condition at the time of withdrawal. Perishable goods, explosive substances, or prohibited importations may not be placed in a bonded warehouse. Certain restricted articles, though not allowed release from custody, may be warehoused.

What is a foreign trade zone?

A Foreign Trade Zone is an area in the United States that is not considered “in the U.S. Customs Territory” for certain legal purposes. Duty is not paid when goods are put into a Foreign Trade Zone, but rather when they are taken out and “entered for consumption” in the United States.

Am I allowed to transport my shipment through the US to a port other than the port of arrival?

Yes, not all merchandise imported into the United States and intended for domestic commerce is entered at the port where it arrives. The importer may prefer to enter the goods at a different location in the United States, in which case the merchandise will have to be further transported to that location. In order to protect United States revenue in these cases, the merchandise must travel in a bonded status from the port of arrival to the intended port of entry. This process is referred to as traveling under Immediate Transportation procedures and is accomplished by the execution of CBP Form 7512 (Transportation Entry and Manifest of Goods Subject to CBP Inspection and Permit). The merchandise is then placed with a carrier who accepts it under its bond for transportation to the intended destination, where the normal merchandise entry process will occur.

Is U.S. Customs and Border Protection the only U.S. government agency that gets involved in the administration of U.S. imports?

No, other U.S. government agencies that are involved in U.S. import administration include:
Department of Agriculture which is tasked with keeping insect and other pests out of the U.S. to the greatest extent possible.
Department of Commerce which collects statistical information about import shipments and compiles trade statistics;
Department of Energy which issues license to import petroleum products
Food and Drug Administration which insures that food and drug conform to certain standards;
Consumer Products Safety Commission which regulates consumer products that the FDA doesn’t handle directly;
Fish and Wildlife Service which is interested in non-domesticated animals, and merchandise made from parts of these animals;
State Department which monitors artifacts and cultural property imported from various countries;
Department of Transportation, Environmental Protection Agency and the Federal Aviation Administration which regulate the import of automobiles and certain related equipment;
Bureau of Alcohol, Tobacco and Firearms which issues license and/or permits to import alcoholic beverages of all kinds, firearms, and other weaponry, and tobacco products.
Foreign Assets Control which issues licenses to import products that would otherwise be prohibited (Cuban cigars, Iranian carpets);
Federal Trade Commission which regulates the importation of textiles, fur, articles, and apparel.
Federal Communications Commission which regulates the importations of radios and certain articles emitting radio frequencies.

Are any licenses required to import products into the U.S.?

Generally licenses are not required to import products into the U.S. There are certain exceptions to this general rule however. As a result importers should always check with U.S. Customs before attempting to bring a new product type into the country.

If I disagree with the duties charged by CBP and the entry has been liquidated, what are my options?

An importer may disagree with the dutiable status after the entry has been liquidated. A decision at this stage of the entry transaction is requested by filing a protest and application for further review on CBP Form 19. For entries filed before December 18, 2006, the time limit is within 90 days after liquidation, but for entries filed after that date, it is now 180 days

Are containers and holders of imported merchandise subject to duties?

CBP designates such items as lift vans, cargo vans, shipping tanks, pallets and certain articles used to ship goods internationally as instruments of international traffic. So long as this designation applies, these articles are not subject to entry or duty when they arrive, whether they are loaded or empty. Other classes of merchandise containers may also be designated as instruments of international traffic upon application to theCommissioner of CBP for such a designation. If any article so designated is diverted to domestic use, however, it must be entered and duty paid, if applicable.

What is a quota?

A quota is a limitation on the quantity of goods that may be imported into a country from all countries or from specific countries during a prescribed time period.

Are there different types of quotas?

Yes, there are absolute quotas and tariff- rate quotas.

What is an absolute quota?

An absolute quota is any pre-set quantity of given goods authorized for importation, during a specified period, beyond which no additional quantity of these goods can be imported.

What is a tariff-rate quota?

A tariff-rate quota is any pre-set value or quantity of given goods authorized for importation, during a specified period with a reduction of the Customs duties. Once a tariff-rate quota is met, additional quantity of the goods subject to the tariff rate quota can still be imported, but higher Customs duties must be paid.

What happens if an import shipment arrives in the U.S. and the quota for the product in the shipment has already been filled?

The product cannot be admitted into the U.S. and the importer has the option of exporting the product, destroying the product or entering the product into a foreign trade zone or a bonded warehouse until the beginning of the next quota period.

Are U.S. importers free to import any product into the U.S.?

No, certain products may not be imported into the U.S. (prohibited imports) while other products are subject to import restrictions or limitations such as licensing requirements and quotas.