Export/Import Procedures and Documentation

 Export/Import Procedures and Documentation

Author: Donna L. Bade
Pub Date: February 2015
Print Edition: $85.00
Print ISBN: 9780814434758
Page Count: 640
Format: Hardback
Edition: Fifth Edition
e-Book ISBN: 9780814434765

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Table of Contents

Contents

Preface xiii

Acknowledgments xv

About the Author xvii

Part I

Organizing for Export and Import Operations

Chapter 1. Organizing for Export and Import Operations 3

A. Export Compliance Department 3

B. Import Department 5

C. Combined Export and Import Departments 9

D. Manuals of Procedures and Documentation 10

E. Record-Keeping Compliance 12

F. Software 17

G. Federal, State, International, and Foreign Law 17

Part II

Exporting: Procedures and Documentation

Chapter 2. Exporting: Preliminary Considerations 21

A. Products 21

B. Volume 22

C. Country Market and Product Competitiveness Research 22

D. Identification of Customers: End Users, Distributors,

and Sales Agents 23

E. Compliance With Foreign Law 24

1. Industry Standards 24

2. Foreign Customs Laws 26

3. Government Contracting 27

4. Exchange Controls and Import Licenses 27

5. Value-Added Taxes 28

6. Specialized Laws 28

F. Export Controls and Licenses 28

G. Patent, Trademark, and Copyright Registrations

and Infringements 29

H. Confidentiality and Non-Disclosure Agreements 30

I. Antiboycott Compliance 30

J. Employee Sales Visits to Foreign Countries—Immigration

and Customs Compliance 30

1. Carnets 31

K. Utilization of Freight Forwarders and Foreign

Customs Brokers 31

L. Export Packing and Labeling (Hazardous Materials) 37

M. Terms of Sale 38

N. Consignments 42

O. Leases 43

P. Marine and Air Casualty Insurance 43

Q. Methods of Transportation; Booking Transportation 45

R. Country of Origin Marking 47

S. Foreign Warehousing and Free Trade Zones 47

T. Export Financing and Payment Insurance 47

U. Tax Incentives 48

V. Export Trading Companies, Export Trade Certificates

of Review, and Export Management Companies 48

W. Translation 49

X. Foreign Branch Operations, Subsidiaries, Joint Ventures,

and Licensing 49

Y. Electronic Commerce 50

Chapter 3. Exporting: Sales Documentation 53

A. Isolated Sales Transactions 53

1. Importance of Written Agreements 53

2. Email Orders 54

3. The Formation of Sales Agreements 54

4. Common Forms for the Formation of

Sales Agreements 57

a. Price Lists 57

b. Requests for Quotations 57

c. Quotations and Costing Sheets 59

d. Purchase Orders 59

e. Purchase Order Acknowledgments,

Acceptances, and Sales Confirmations 64

f. Pro Forma Invoices 64

g. Commercial Invoices 73

h. Conflicting Provisions in Seller and Buyer Sales Documentation 73

i. Side Agreements 76

B. Ongoing Sales Transactions 76

1. Correlation with Documentation for Isolated Sales Transactions 77

2. Important Provisions in International Sales Agreements 78

a. Selling and Purchasing Entities 79

b. Quantity 79

c. Pricing 80

d. Currency Fluctuations 83

e. Payment Methods 83

f. Export Financing 86

g. Security Interest 86

h. Passage of Title, Delivery, and Risk of Loss 89

i. Warranties and Product Defects 89

j. Preshipment Inspections 90

k. Export Licenses 91

l. Import Licenses and Foreign Government Filings 91

m. Governing Law 92

n. Dispute Resolution 94

o. Termination 96

C. Export Distributor and Sales Agent Agreements 97

1. Distinction Between Distributor and Sales Agent 97

2. Export Distributor Agreements 97

a. Territory and Exclusivity 99

b. Pricing 99

c. Minimum Purchase Quantities 102

d. Handling Competing Products 102

e. Effective Date and Government Review 103

f. Appointment of Subdistributors 103

g. Use of Trade Names, Trademarks, and Copyrights 103

h. Warranties and Product Liability 104

3. Export Sales Agent Agreements 105

a. Commissions 105

b. Pricing 105

c. Shipment 105

d. Warranties 108

e. Relationship of the Parties 108

D. Foreign Corrupt Practices Act Compliance 108

E. U.S. Export Control Laws 109

Chapter 4. Exporting: Other Export Documentation 111

A. Freight Forwarders 111

B. Shipper’s Letters of Instructions 112

C. Commercial Invoices 115

D. Bills of Lading 117

E. VOCCs and NVOCCs 120

F. Packing Lists 120

G. Inspection Certificates 126

H. Marine and Air Casualty Insurance Policies

and Certificates 129

I. Dock and Warehouse Receipts 130

J. Consular Invoices 130

K. Certificates of Origin 153

L. Certificates of Free Sale 153

M. Delivery Instructions and Delivery Orders 155

N. Special Customs Invoices 155

O. Shipper’s Declarations for Dangerous Goods 155

P. Precursor and Essential Chemical Exports 168

Q. Animal, Plant, and Food Export Certificates 168

R. Drafts for Payment 175

S. Letters of Credit 175

T. Electronic Export Information 179

U. Freight Forwarder’s Invoices 194

V. Air Cargo Security and C-TPAT 194

1. Air Cargo Security 194

2. Customs and Trade Partnership Against

Terrorism (C-TPAT) 195

Chapter 5. Export Controls and Licenses 197

A. Introduction 197

B. Scope of the EAR 199

C. Commerce Control List 200

D. Export Destinations 204

E. Customers, End Users, and End Uses 213

F. Ten General Prohibitions 214

G. License Exemptions and Exceptions 216

H. License Applications and Procedures 219

1. Documentation From Buyer 219

2. License Application Form 222

3. Procedures 228

I. Re-Exports 231

J. Export Documentation and Record-Keeping 231

K. Special Comprehensive Licenses 234

L. Technology, Software, and Technical Assistance

Exports 236

M. Validated End-User Program 238

N. Antiboycott Regulations 239

O. Violations and Penalties 246

P. Embargoes and Trade Sanctions Programs 246

R. U.S. Munitions and Arms Exports 247

S. Enforcement 258

Part III

Importing: Procedures and Documentation

Chapter 6. Importing: Preliminary Considerations 261

A. Products 261

B. Volume 262

C. Country Sourcing 263

D. Identification of Suppliers 264

E. Compliance With Foreign Law 264

1. Foreign Export Controls 265

2. Exchange Control Licenses 266

3. Export Quotas 266

F. U.S. Customs Considerations 267

1. Utilization of Customs Brokers 268

2. Importation Bonds 269

3. Importer’s Liability and Reasonable Care 272

4. Application for Importer’s Number 275

5. Ports of Entry 275

6. Import Quotas 280

7. Antidumping, Countervailing, and Other Special Duties 281

8. Classification 282

9. Valuation 283

10. Duty-Free and Reduced Duty Programs 284

11. Column 2 Imports 285

12. Deferred Duty Programs (Bonded Warehousing

and Foreign Trade Zones) 285

13. Record-Keeping Requirements 293

14. Customs Rulings 293

G. Import Packing and Labeling 296

H. U.S. Commercial Considerations 297

1. Prevailing Market Price 297

2. Buy American Policies 297

3. U.S. Industry Standards 301

I. Terms of Purchase 301

J. Consignments 304

K. Leases 304

L. Marine and Air Casualty Insurance 305

M. Method of Transportation; Booking Transportation 305

N. Import Financing 306

O. Patent, Trademark, and Copyright Registrations

and Infringements 306

P. Confidentiality and Non-Disclosure Agreements 308

Q. Payment 308

R. Translation 309

S. Foreign Branch Operations, Subsidiaries, Joint Ventures,

and Licensing 309

T. Electronic Commerce 310

Chapter 7. Importing: Purchase Documentation 313

A. Isolated Purchase Transactions 313

1. Importance of Written Agreements 314

2. Email or Internet Orders 314

3. The Formation of Purchase Agreements 315

4. Common Forms for the Formation of Purchase Agreements 317

a. Price Lists 317

b. Requests for Quotations and Offers to Purchase 317

c. Quotations 317

d. Purchase Orders 318

e. Purchase Order Acknowledgments, Acceptances,

and Sales Confirmations 319

f. Commercial Invoices 319

g. Conflicting Provisions in Seller and Buyer Sales

Documentation 320

h. Side Agreements 321

B. Ongoing Purchase Transactions 321

1. Correlation With Documentation for Isolated Purchase Transactions 322

2. Important Provisions in International Purchase Agreements 323

a. Purchasing and Selling Entities 323

b. Quantity 324

c. Pricing 324

d. Currency Fluctuations 327

e. Payment Methods 328

f. Import Financing 330

g. Security Interest 330

h. Passage of Title, Delivery, and Risk of Loss 331

i. Warranties and Product Defects 331

j. Preshipment Inspections 332

k. Export Licenses 332

l. Governing Law 333

m. Dispute Resolution 334

n. Termination 336

C. Import Distributor and Sales Agent Agreements 336

1. Distinction Between Distributor and Sales Agent 336

2. Import Distributor Agreements 337

a. Territory and Exclusivity 337

b. Pricing 338

c. Minimum Purchase Quantities 338

d. Handling Competing Products 339

e. Appointment of Subdistributors 339

f. Use of Trade Names, Trademarks, and Copyrights 339

g. Warranties and Product Liability 340

3. Import Sales Agent Agreements 340

a. Commissions 340

b. Pricing 341

c. Shipment 341

Chapter 8. Import Process and Documentation 343

A. Importer Security Filing and the 10+2 Program 345

B. Bills of Lading 345

C. Commercial Invoices 346

D. Pro Forma Invoices 347

E. Packing Lists 347

F. Inspection Certificates 347

G. Drafts for Payment 349

H. Arrival Notices 349

I. Pickup and Delivery Orders 349

J. Automated Commercial Environment (ACE) 350

K. Entry/Immediate Delivery 350

L. Entry Summary 352

M. Other Entries 358

N. Reconciliation 361

O. GSP, AGOA—Special Programs 362

P. NAFTA/Other FTA Certificates of Origin 363

Q. Specialized Products Import Entry Forms 364

R. Examination and Detention 369

S. Liquidation Notices 379

T. Notices of Redelivery 380

U. Post Entry Amendment 380

V. Requests for Information 383

W. Notices of Action 383

X. Protests 387

Y. Record-Keeping 387

Z. Administrative Summons 391

AA. Search Warrants 391

BB. Grand Jury Subpoenas 391

CC. Seizure Notices 395

DD. Prepenalty Notices 395

EE. Penalty Notices 395

FF. Customs Audits 399

GG. Penalties 401

HH. Prior Disclosure 402

II. Court of International Trade 403

JJ. Appeals 403

KK. Offers of Compromise 404

LL. ITC and Commerce Questionnaires 404

Part IV

Global Customs Considerations

Chapter 9. Determining the Proper Classification

of a Product 407

A. The Organization of the Tariff Schedules 408

B. The General Rules of Interpretation 410

C. Duty Rates 418

Chapter 10. Determining the Proper Value to Declare 425

A. Transaction Value 426

1. Additions to the Transaction Value 426

2. Deductions from the Transaction Value 428

3. Related Parties 429

B. Transaction Value of Identical Merchandise 429

C. Transaction Value of Similar Goods 430

D. Deductive Value 430

E. Computed Value 430

F. Fall-Back Methodology 431

1. Unacceptable Methods 431

G. First-Sale Transactions 432

Chapter 11. Determining the Proper Country of Origin 435

A. Preferential Duty Laws 436

1. Substantial Transformation 437

2. The 35 Percent Agreements 437

a. GSP: Generalized System of Preferences 438

b. CBERA: Caribbean Basin Economic Recovery Act 439

c. AGOA: African Growth and Opportunity Act 440

d. United States–Israel Free Trade Agreement 441

3. The Free Trade Agreement Tariff-Shift or Tariff-Shift

Plus Regional Value Content Rules 441

a. North American Free Trade Agreement (NAFTA) 441

1) Preference Criterion A 443

2) Preference Criterion B 443

3) De Minimis 444

4) Regional Value Content 444

5) Preference Criterion C 446

6) Preference Criterion D 446

7) Preference Criterion E 446

8) Preference Criterion F 447

9) Accumulation/Cumulation 447

10) Fungibility 447

11) Certificates of Origin 447

b. The Other Free Trade Agreements 450

B. Country of Origin Marking Laws 455

1. Country of Origin for Marking Purposes 456

2. NAFTA Country of Origin Marking Rules 457

3. Other Free Trade Agreement Marking Rules 458

C. Federal Trade Commission Rules on “Made in the

USA” Marking 458

D. Government Procurement 459

1. The Buy American Act 459

2. The Trade Agreements Act and the WTO Agreement

on Government Procurement 461

3. Other Buy American–Type Requirements 464

a. Buy America 464

b. The Berry Amendment 465

Part V

Specialized Exporting and Importing

Chapter 12. Specialized Exporting and Importing 469

A. Drawback 469

1. Unused Drawback 469

2. Rejected Merchandise Drawback 470

3. Manufacturing Drawback 476

B. Foreign Processing and Assembly Operations 477

C. Barter and Countertrade Transactions 482

Appendix A. Incoterms Diagram 483

Appendix B. International Sales Agreement (Export) 485

Appendix C. Department of Defense – Compliance Program

Guidelines 491

Appendix D. Informed Compliance: Reasonable Care 497

Appendix E. USITC Harmonized Tariff Schedule Contents 515

Appendix F. International Purchase Agreement (Import) 521

Appendix G. ACE Program and Standard Reports 527

Appendix H. Guidance on Internet Purchases 537

Appendix I. Regulatory Audit Questionnaires 547

Appendix J. Export/Import–Related Web Sites 555

Glossary of International Trade Terms 561

Index 591

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