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Chapter 8

GMS 723- Chapter 8- How to Import in the United States.docx

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Ryerson University
Global Management Studies
GMS 723
Michael Manjuris

GMS 723- Chapter 8- How to Import in the United States  Importing is the flip side of exporting—some aspects of exporting don’t apply o EG tariff schedule applies only to importing and the Customs services is concerned only with goods coming into a country World Customs Organizations (WCO)  Provided leadership in expanding the avenues of international trade  Success—driven by a clear minded adherence to a principle o More simple and harmonized the worlds customs procedures, the more prosperity for international trade and the world at large  Scored many triumphs across the entire spectrum of customs-based issues o EG it created and administers several international agreements that facilitate world trade  Major international conventions crested or administered by the WTO o Harmonized system convention (basis from the US import and export schedules) o GATT customs valuation agreement o Nairobi and Johannesburg conventions, both dealing with sharing information o 1973 Kyoto convention on customs procedures o 1999 Revised Kyoto convention, formally known as the international convention on the harmonization and simplification of customs procedures  June 2002—council unanimously adopted a resolution on the security and facilitation of the international trade supple chain proposed by the US o Resulted in development of numerous guidelines, benchmarks, and best practices Homeland Security  Served to mobilize and organize the US to secure itself from terrorist attacks  Vision and mission statement, strategic goals, and objectives provide the framework that guilds the actions that make up the daily operations of the department Government Support  Immigration and customs enforcement (ICE) o Created in March 2003 o Largest investigative branch of the department of homeland security o Created after the events of 9/11—combining the law enforcement arms of the former immigration and naturalization service (INS) and the former US customs services 1 GMS 723- Chapter 8- How to Import in the United States o Before the events of 9/11—immigration and customs authorities were not widely recognized as an effective counterterrorism tool o Targets the people, money, and materials that support terrorist and criminal activity o Second largest federal law enforcement contributor to the Joint Terrorism Task Force o Dismantled gang organizations by targeting their members, seizing their financial assets, and disrupting their criminal operations through Operation Community Shield o Investigates employers and targets illegal workers o Helps identify fraudulent immigration benefit applications and fraudulent illegal document manufacture (identity and benefit fraud program) o Investigates the illegal export of US munities and sensitive technology (Project Shield America Initiative) o Helps combat criminal organizations that smuggle and traffic in humans (human Smuggling and trafficking initiative) o Ensures that every alien who has been ordered removed departs the US as quickly as possible (National Fugitive Operations Program) o Aggressively seeks to destroy the financial infrastructure that criminal organizations use to earn, move, and store illicit funds (Cornerstone initiative) o Provides law enforcement and security services (Federal Protective Services) o Leading role in targeting criminal organizations responsible for producing, smuggling, and distrusting counterfeit products (National intellectual property rights coordination center o Law enforcement community through three units—sharing information and providing investigative support  Law enforcement support center, forensic document laboratory, cyber crimes center  Customs and border protection services (CBP) o Cannot be thought of as supporting importing in the way the Department of commerce encourages exports o Responsible for enforcement of relevant trade o One of nations oldest public institutions o Customs service was probably the second thing the First Congress saw to after forming the new nation o Provided most of the federal governments revenue for almost 130 years o After income tax become the federal governments primary revenue source—major responsibility of the customs services shifter to the administration of the Tariff act 1930  Duties include: enforcing laws against smuggling and collection all duties, taxes, and fees due on the volumes of goods moved o Domestic offices—organized into five strategic trade centers (STC), 20 customs management centers (CMCs) and 317-plus ports of entry offices  CMCs are responsible for oversight of operations within their jurisdiction and exercise line authority over the ports  Provide technical assistance and work with the ports in addressing operational problems  Oversee the execution of the core business process—trade compliance, passenger operations, and outbound operations  Coordinate with counterpart special again in charge (SAIC) offices in executing anti-smuggling  Point of contract for providing the answers to questions that concern issues o EG exporting merchandise, seized properties, fines, penalties, and forfeitures  Ports of entry are responsible for all daily operational aspects of Custom Services 2 GMS 723- Chapter 8- How to Import in the United States  Responsible for maintaining a focus on trade compliance, passenger operations, outbound operations, and antismuggling/K- 9 strategies o Overseas offices  Customs attachés (Customs’ overseas arm) are attached to the embassies or missions in the following countries: Belgium, Italy, Thailand, Canada, Japan, West Germany, England, Korea, France, Mexico, Hong Kong, China, and Pakistan Import Information Sources  Custom services provides considerable information related to the importing function  Information amounts to extractions from and simplification of customs regulations o How to make contacts and/ or perform the import function must be obtained through private sector publishers and organizations such as chambers of commerce or trade association  Helpful sources o Importing into the US o Thomas Register of American Manufacturers Customs House Brokers  Private, for-profit liaison between the Customs Service and the importing public  Will be needed as long as there are legal requirements and regulations pertaining to the movement of merchandise  Like freight forwarder for exporting—private service company licensed to assist importers in the movement of their goods  Some brokers are sole proprietors with single office at one port of entry o Others are large corporations with branches in many ports throughout the country—all are licensed and regulated by the Treasury Department o Some even have offices around the world  Importers employ the customs broker as their agent—frequently their only point of contact with the Customs Services  Brokers advise—on the technical requirements of importing, preparing, and filling entry documents; obtaining the necessary bonds; depositing UD import duties; securing release of the products; arranging delivery to the importers premises or warehouse; obtaining drawback refunds  Often consult with customs to determine the proper rate of duty or bases of appraisement o If dissatisfied with either rate or value, will pursue appropriate administrative remedies on behalf of the importer Surety Bonds  Importers must post a Surety bond with the customs services to ensure payment of the proper amounts od duties, taxes, and other charges associated with entry  Often a bond is three times the value of the shipment is required  Surety company usually requires 100% collateral in the form of an irrevocable letter of credit, trust deed, or cashiers check  Cond premium—2% of the value with a minimum of about $100  Premium for a term bond is usually higher—5% Drawbacks  Refunding of duties paid on imported goods and their derivatives if they are subsequently exported  EG you simply re-export goods that were originally imported, or you export items that contained imported merchandise or the contained whole imported components each of these you might claim drawback of tariffs paid when imported  Key good inventory tracking and record-keeping procedures Automated Brokerage Interface (ABI)  Those large-volume importers who file many simple entries and wish to avoid the cost of a broker  Permits importers (and brokers) to electronically file preliminary entry data in advance of the arrival of cargo 3 GMS 723- Chapter 8- How to Import in the United States How to Become a Customs Broker  Private individuals, partnership, associations, or corporations licensed, regulated, and empowered by US customs and Border Protection (CBP) o Assist importers and exporters in meeting federal requirements governing imports and exports  Submit necessary information and appropriate payments to CBP on behalf of their clients and charge the clients a fee for this service 1. Studying the Customs Service regulations and learning the application of the tariff schedules 2. Passing an examination given several times a year  This license is not necessary for you to act on your own behalf—needed if you act as an agent for others  Must have expertise in entry procedures, admissibility requirements, classification, valuation, and rates of duty and applicable taxes and fees for imported merchandise Getting through the Customs Maze  Tariff- schedule of duties o Duty or tax imposed by a country and the duty or tax within the tariff schedule  As a tax—it is placed on goods as they cross the border between two countries The Four-Step Entry Process  When a shipment of goods intended for commercial use reaches the US—it may not legally entered until 1. It enters the port of entry 2. Estimated duties have been paid 3. Customs authorizes delivery of the merchandise  During process only the owner is responsible for the entry  Step 1: entry within 24 hours of arrival of a shipment at a US port of entry—owner/agent must decide whether to enter the goods for consumption or place then into a bonded warehouse or free trade zone o If made to enter for consumption, following entry documents must be filed 4 GMS 723- Chapter 8- How to Import in the United States  Entry manifest—customs form 7533 or special delivery 3461
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