It is important that companies engaged in import/export transactions pay close attention and devote the proper resources in ensuring full compliance with Customs Laws and Regulations. I have seen through the years, negligence or lack of understanding by companies regarding Customs Laws and Regulations which have created major problems with fines and penalties and other unforeseeable costs.

I am providing some of the basic Customs Compliance Guidelines that companies need to consider in their import transactions. These should be taken as reference or as a starting point in your compliance efforts. Please contact your U.S. Customs Broker or Customs Consultant for your particular situations and needs.

NAFTA Claims
Part numbers that are NAFTA certified are coded in the customs invoice with a MX in front of the Harmonized Tariff Number.

Ensure that every part that is coded with the MX has been NAFTA certified and that a valid NAFTA certificate of origin is on file.

Make sure there is a system for adding new NAFTA models to the NAFTA Certificate of Origin before the product is first imported. If determination of NAFTA eligibility is not possible before the first import, then do not claim NAFTA until the determination of eligibility is made and a NAFTA Certificate of Origin has been issued for that model. A NAFTA Post-Importation Claim or 520 (d) can be filed within one year from the date
of entry to obtain a refund of the duties if the product qualifies for NAFTA preferential treatment.

9802.00.80 Claims

The 9802.00.80 provision (U.S. Components Assembled Abroad) can be used when a part number is non-NAFTA certified and the duty savings are material and there are U.S. components ready for assembly that are part of the finished goods.

Ensure that 9802.00.80 is not used for parts that are NAFTA certified. Also, if there are parts that are non-NAFTA certified and you are using the 9802.00.80 program, ensure that you have all of the manufacturer’s affidavits on file for the components being claimed under 9802.00.80 as well a cost sheet and the assembly description of the part.

Please note that 9802.00.80 can only be used for U.S. components that are ready to be assembled and not for U.S. components that are to be further processed in Mexico such as resins, greases, chemicals, etc.

9801.00.10 Claims

The 9801.00.10 provision (U.S. Goods Returned) can be used when raw material or equipment of U.S. origin is to be returned to the U.S. without being advanced in value or improved in condition.

Ensure that a manufacturer’s affidavit or NAFTA certificate of origin is on file for the goods in question if you are going to use the 9801.00.10 provision. Failure to do this might result in duty increases and possible penalties.

It is recommended that an audit is performed to ensure that all of the manufacturer’s affidavits are on file for goods being claimed as 9801.00.10.

Please note that for customs purposes, country of origin means country of manufacture or assembly and not necessarily the country in which the article was bought or from where it was exported.

Classification and Country of Origin of Goods

It is recommended that the full Harmonized Tariff Classification (HTSUS) and Country of Origin of the goods be stated on the customs invoice. This will allow for the proper and timely clearance of goods.

Entry Audits

It is the responsibility of the U.S. Customs Broker to ensure due diligence when preparing customs documentation on behalf of their customers. However, the importer of record is ultimately responsible for the information submitted to U.S. Customs on their import transactions.

Because of this, it is recommended that a representative from the importer of record audits the entry documentation prepared by the U.S. Customs Broker for accuracy possibly before it is submitted to U.S. Customs. This has to be done by a person that is properly trained on the requirements of the importer’s customs transactions. If there are any corrections to be made to the entries, these need to be communicated to the U.S. Customs Broker and decide on the most appropriate manner to correct these (Supplemental
nformation Letter, Prior Disclosures, ACS Reconciliation, etc.).

Valuation and Appraisement of Goods

Computed Value is the method of appraisement most widely used for related party transactions (maquiladoras).

Please make sure that all of the elements of computed value are included in the value of your finished goods.

Also, when returning raw material or equipment, the value to be used is the actual/transaction value or standard cost if the actual/transaction value is not available. In the case of equipment, a depreciated value or fair market value can be used. In the case of scrap material, the salvage value can be declared.

Please note that every single article imported to the U.S. has to be properly valued and appraised.

ACS Reconciliation

Importers that are under the computed value method of appraisement need to reconcile the estimated values declared to U.S. Customs on a periodic basis. This can be done via the ACS Reconciliation.

The results obtained in the Actual Cost Submission prepared for the ACS Reconciliation should be reflected in the estimated computed values that were declared in the period being reconciled. This is in order to reflect an estimated computed value closer to the actual computed value for the next period to be reconciled.

Even though U.S. Customs realizes that importers under computed value do not have the actual computed value information readily available at the time of entry, they do expect that the estimated computed value declared at the time of entry should not be that much different from the actual computed value.

Having considerable discrepancies between the estimated and actual computed value could raise a flag to U.S. Customs and it might trigger an audit.

U.S. Customs Compliance Procedure

Having a U.S. Customs Compliance Procedure in place shows U.S. Customs that the importer is exercising “Reasonable Care” in conducting customs business.

It is recommended that a U.S. Customs Compliance Procedure is developed to ensure full compliance with U.S. Customs Laws and Regulations.

Your U.S. Customs Broker or Customs Consultant can assist you in complying with these basic requirements along in developing the appropriate U.S. Customs Compliance Procedures for your company.