Dear Merchants,
Our Shipping Carriers have brought to our attention that the U.S. Customs Division is closely monitoring under valued shipments as declared on the shipping documents. They have indicated that many businesses are currently undergoing extensive audits by U.S. Customs that are costing businesses hefty fines for violating under valued declared duties and falsifying them as "gifts" when they are not.
Our system is pulling through the Declared Value on the order as you have your items valued in the MIS. It is important to list the Customs Value as your Wholesale Value. We are urging you to update your values in the MIS to reflect the accurate wholesale values of your products. Customs Dept.'s have actually gone to some of our client's websites to see what value they are selling items for, have called the buyer to ask them what they paid for the item and compare it to what is listed on the commercial invoice. They have recalculated duties and taxes based on the "online rate", not the declared rate you have told us to use on the order, and re-billed our account accordingly. Please note that we will not be liable for the extra fees assessed to our account and you will in turn be charged for the extra charges if this happens. You will also be liable for any expenses incurred by us to comply with an audit. Here is some helpful information I encourage you read:
Customs Valuation
The value to declare for Customs purposes is the price paid or payable for the goods. Any selling commissions, assists, royalties, packing and proceeds must also be factored in and is a part of the value.
Failure to include the above is undervaluing the goods and may result in penalties.
Duty is assessed on the price paid and does not include freight and insurance charges.
All prices in foreign currency must be converted to U.S. dollars to assess duty on the amount.
Please do not list "gift" on orders that are going to businesses and not a gift. Each country may have different rules about gifts, and here is an excerpt about this from FedEx:
Gifts
Gift shipments must be from an individual to an individual or from a company to an individual. Shipment from business to business are considered commercial, not gifts. It must have a wholesale value of $100.00 USD or less, per recipient, per day.
Gifts from the U.S. Virgin Islands, Guam, and American Samoa must have a wholesale value of $200.00 USD or less per recipient, per day.
It must be properly marked as 'gift' on the outside of the box. Documentation required: Air Waybill and Pro Forma/Commercial Invoice. The following critical information must be provided on the invoice:
• Complete name, address, and phone number of both the shipper and consignee
• Complete description of the product(s), including if the item is home made or store-bought.
• For consolidated gift shipments, list the names of each individual receiving a gift, the gift item(s) from each individual and the value of each item. The total gift value for each individual must not exceed the above-mentioned value limits.
• A statement indicating that shipment is an 'unsolicited gift, not for resale'
Products with Special/Additional Requirements:
• Non-Perishable Food Items - home made or store-bought food items sent from an individual to an individual, valued under $200.00 USD, do not require submission of FDA Prior Notice.
• Note: Perishable foodstuffs are prohibited from FedEx International Express Service.
• Textiles - quota limitations on textiles and apparel items do not apply to gift shipments.
• Alcoholic Beverages, Cigars and Cigarettes from an individual to an individual are prohibited from FedEx International Express Service. Cuban cigars are prohibited entry into the United States.
• Perfume containing alcohol are excluded from the gift provisions and may be subject to duty/tax and formal entry filing.
• Personal and Household Effects - articles purchased solely for the personal use of an individual and shipped unaccompanied, will be entered under separate Customs provisions, not as a gift.
• Caviar requires clearance at a Fish and Wildlife port and a CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) permit is required.
Customs Valuation for import to China
Customs regulations state that Customs has the authority to inspect all shipments and if customs finds a discrepancy with a declared value, weight or number of packages, Customs may detain and inspect the shipment. If Customs finds a violation of their laws and regulations, the owner of the goods may be fined.
In addition, Customs has the right to re-evaluate an importation if the declared value is obviously lower than the price of the same or a similar commodity in the local market or in the international market place, or there is evidence that the seller and the buyer have conducted private transactions and the consignee cannot provide reasonable or legal supporting evidence of the commodity's true value.
Regarding declared value.
There are two declared values:
Declared value for customs which should match the CI.
Declared value for carriage explained on page 136 of the FedEx service guide:.
https://www.fedex.com/content/dam/fedex/us-united-states/services/Service_Guide_2021.pdf
In fact Global Trade Manager, country profiles at fedex.com, you can research your destinations and look at the specific guidelines for export.
There is a great deal of helpful information also listed on the U.S. Bureau of Industry and Securities website about exporting products that you can review . There is now a link to this site and other important areas on the MIS in a new section called "International Shipping": International Shipping
I know this is a great deal of information to digest, but I want all of your businesses to be prepared with the proper documentations if an audit is ever performed. Please know that we cannot be held responsible for extra fees, fines, or audits conducted if your orders incur them. I would be happy to address specific questions that you may have directly to FedEx and UPS so please let us know your concerns and questions as you have them. Exporting products can be a great way to expand your business as long as it is done correctly. I encourage you to go to the MIS and read the links posted to give you more knowledge on exporting your products.
Sincerely,
Sandy Griffin
sales@wefulfillit.co