Customs Compliance Services

An importer is required to exercise "reasonable care" in importing merchandise into the United States. U.S. Customs and Border Protection (CBP) has emphasized that while written customs compliance policies and procedures may not be required under the law, they go a long way towards ensuring than an importer is acting with "reasonable care." In fact, under CBP's current audit program, the Focused Assessment (FA) program, one of the first items CBP will ask an importer for is its written customs compliance policies and procedures.

Global Trade Expertise has assisted many clients in developing and drafting customs compliance policies and procedures manuals, as well as very practical desktop manuals that describe day-to-day processes and procedures. Global Trade Expertise can work with you to develop practical manuals and procedures that will actually be used by your employees (rather than voluminous documents full of legalese).

An importer is required to use reasonable care to declare the proper valuation of an imported product. Determining the proper basis of appraisement for a company's imported products is often complex and must be based on the structure of the transaction and the Customs valuation statute. An incorrect basis of appraisement or failure to include all required additions to value can lead to inquires from Customs and potential penalties.

Global Trade Expertise can assist clients in not only determining the proper basis of appraisement (i.e., transaction value, transaction value of identical or similar goods, computed value, deductive value, or a "fall back" methodology), but also determining whether trademark, royalties, or licensing fees are dutiable and whether any additions to value should be included (e.g., assists). Global Trade Expertise has assisted clients in lawfully reducing their customs valuation (and associated duties and fees) using first sale valuation.

The tariff classification of imported merchandise governs the applicable duty rate. The proper ten-digit classification under the Harmonized Tariff Schedule of the United States (HTSUS) number must be provided by importers to U.S. Customs and Border Protection (CBP) when an entry is filed. It is the importer’s responsibility to exercise reasonable care in the classification of merchandise. Errors due to a lack of reasonable care can result in significant fines and penalties.

In order to accurately classify imported merchandise, a detailed legal analysis and comprehensive knowledge of the HTSUS, Customs rulings and practices as well as court decisions is required.

We can help our clients assess the correctness of their products' tariff classifications, prepare ruling requests to submit to U.S. Customs and Border Protection (CBP) advocating for a specific tariff classification, and pursue duty refunds due to improper tariff classification through the appropriate administrative or judicial proceedings. We can also provide training on how to properly classify your products and and help develop and implement processes and procedures to ensure that merchandise is properly classified.

U.S. Customs laws require each imported article produced abroad to be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article permits, with the English name of the country of origin, to indicate to the ultimate purchaser in the United States the name of the country in which the article was manufactured or produced. Additionally, the correct determination of the origin of goods is critical in determining qualification under preferential free trade agreements (FTAs).

Global Trade Expertise will evaluate your products and supply chain to determine the correct country of origin. We will help you ensure that all appropriate markings are present. We will assist you in determining what FTAs may be applicable for your supply chain and how to qualify for your products under the FTA. In addition, we aid you in establishing internal control procedures to ensure continued validity of the goods’ origin.

The requirement to use "reasonable care" imposed upon importers and exporters provides that companies must monitor their customs transactions to ensure they are in compliance with all applicable regulations. Importers can ensure that they are exercising reasonable care in their day to day customs compliance functions by periodically conducting a self-assessment of their customs operations. Moreover, conducting a self-assessment is critical preparation for any formal investigations or audits conducted by U.S. Customs officials. Alternatively, an importer may avoid an audit by choosing to participate in a compliance management program known as an Importer Self-Assessment (ISA).

Global Trade Expertise can assist importers with all conducting an assessment of a company's customs compliance. We model our assessments on CBP's Focused Assessment Program (FAP) so that our clients are thoroughly prepared for any future CBP audit or investigation. In conducting such assessments, we provide our clients with an initial questionnaire tailored to the particular customs operations of the client, will interview key company personnel who have an effect on the company's customs compliance, and will review the company's written procedures and sample customs entries. Our deliverable will identify issues found, best practices (including benchmarking against similarly situated importers), and recommendations. Where prudent, we will assist an importer with the preparation and filing of a valid prior disclosure of any violations found so that our clients are protected from excessive penalties.

It is the responsibility of the importer to exercise “reasonable care” in complying with Customs laws and regulations by considering the applicable laws and regulations, Customs’ administrative precedent and case law, and the specific facts and circumstances presented. However, in some instances, even after consulting these sources, the proper course of action to take with regard to specific customs compliance matters may still remain unclear. In other cases, an importer may have a strong commercial interest in having certainty and confirmation before importing certain merchandise. Obtaining a binding ruling from the CBP ensures certainty to an importer with regard to the proper tariff classification, customs valuation, country of origin, marking, and applicability of special trade programs to an importer’s merchandise.

Global Trade Expertise has drafted numerous successful ruling requests and Requests for Internal Advice covering all types of merchandise and a broad range of issues on behalf of our clients. We work with our clients to get a thorough understanding of the commercial objectives sought and prepare Customs ruling requests that advocate for the desired outcome based on applicable Customs laws and regulations.

An essential component of an effective Customs compliance program is training the people who are directly and indirectly involved in the importing process, as well as providing awareness training for other employees whose actions affect the company’s customs compliance efforts.

Global Trade Expertise can develop training classes and material for various departments and companies on any topic related to international trade. These classes will be specifically tailored to meet the needs of the company and the individuals participating in the training.

Certain foreign manufactured products qualify for full or partial duty exemptions upon import into the United States, through various tariff preference programs offered by the United States. Such programs include Chapter 98 of the Harmonized Tariff Schedule of the United States (HTSUS), temporary importation bonds (TIBs), carnets, and the application of free trade agreements (FTAs). Additionally, there are programs such as Duty Drawback which allow for refund of duties under certain circumstances. Finally, there are programs such as Foreign Trade Zones (FTZs) and Bonded Warehouses which allow for the deferral or elimination of duties under varied conditions.

Global Trade Expertise regularly advises clients with regard to what special trade programs may be available and how to comply with applicable requirements, which result in substantial duty savings for importers.

Many importers are choosing to participate in the Customs-Trade Partnership Against Terrorism (C-TPAT), a voluntary security initiative through which companies commit to enhancing supply chain security in a cooperative effort with CBP to reduce the risk of terrorist attacks in the commercial cargo environment. We can help a company determine if C-TPAT is right for your company. We can assist a company with the validation process, provide training, and advise on similar international programs such as Europe’s Authorise Economic Operator (AEO) program.

The Trade Compliance department of a company is often asked for its opinion on where the company should source its products or conduct key overseas operations such as distribution or repairs based on trade compliance considerations.

Global Trade Expertise can assist the Trade Compliance personnel in a company to provide more than just a landed cost calculation in response to such an inquiry. Global Trade Expertise can provide an analysis of the following key factors: availability of free trade programs, trade security programs, ease of doing business (transparency, local vs. national control of customs authorities, bureaucracy, culture), and choosing local parters (based on trade compliance history, reputation, communication), etc.

A Focused Assessment (FA) is an audit conducted by CBP according to specific published guidelines. A Quick Response Audit is a limited audit of a specific issue by CBP conducted on a case-by-case basis.

Generally, CBP begins the FA by asking the importer to complete an internal control questionnaire regarding the company’s compliance program and importing activity. Once the importer responds to the internal control questionnaire, CBP will move to the Pre-Assessment Survey (PAS) which involves on interviews with company officials and customs compliance personnel, a review of company’s compliance procedures, and limited testing of sample customs entries. Based on CBP’s findings in the PAS, a company may be subjected to further extensive transactional testing in the Assessment Compliance Testing (ACT) phase of the Focused Assessment. To conclude the FA, CBP will present its findings to the company for their comments.

If CBP deems an importer’s compliance program to be lacking and/or uncovers noncompliance with Customs laws or regulations, CBP will require the payment of any revenue owed to CBP and may require that the company develop Compliance Improvement Plans (CIP) where it deems necessary. After submission of the improvement plan, CBP will revisit the importer to test the effectiveness of the CIP. CBP may also delay an importer’s shipments through intensive cargo exams on a more frequent, ongoing basis.

Moreover, if CBP determines that the importer was acting with negligence, grossly negligence, or fraud with respect to any violations found, CBP could investigate the matter further and assess civil or criminal penalties against an importer.

Global Trade Expertise can assist importers in preparing for a FA by conducting an internal assessment of the company’s customs compliance policies and procedures. By interviewing key company personnel who have an effect on the company’s customs compliance, GTE can quickly assess a company’s overall customs compliance.

Based on the findings of our initial assessment, GTE will select a sample of the company’s customs entries to assess the company’s compliance on a transaction basis. Finally, GTE will identify any potential areas of liability and advise the company as to whether a prior disclosure of the violations to CBP (protecting the company from excessive penalties) is warranted. If a company chooses to file a prior disclosure with CBP, GTE can assist with drafting a prior disclosure to meet all of CBP’s requirements.

Finally, GTE can represent a company during a Focused Assessment and assist the company in managing the FA and its interactions with CBP so that the FA is as unobtrusive as possible to the company’s day to day business.

Internal Compliance Procedures and Programs

Customs Valuation

Tariff Classification

Country of Origin/Free Trade Agreements

Compliance Assessments and Reviews

Customs Ruling Requests

Seminars and Training

Duty Exemptions, Refunds, and Deferral Programs

Trade & Cargo Security

Global Sourcing Planning

FAPs & Quick Response Audits