New to Importing? – 5 Fundamental Guidelines

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For those unfamiliar with the minutiae of importing/trade, it’s easy to be overwhelmed by the complexity of information, terms and how to decipher requirements; here is a list of five essentials to get you started:

1.     HS Classification:

The customs environment requires that your product be classified according to a coding structure named the Harmonized System (HS). The 10-digit HS determines how much duty is applicable at import depending on what the product is and its Country Of Origin (COO).

To get a clearer picture; it’s essential you familiarize with:

  1. The best description of your goods; (in technical as well as layman’s terms).
  2. Know the country of origin of the goods.
  3. Product details such as material of chief value; (i.e. plastic, wood, etc.), character/construction; (i.e. woven, knitted, plated metal, etc.), essential function; (i.e. to decode/play movies, part of diesel engine, etc.), and for clothing; sex (i.e. men’s/women’s) and age (i.e. children’s) all can affect your HS class.
  4. Import reason; for what use – end use may determine classification; (i.e. bedroom furniture).

Incorrect HS classification can lead to delays in clearing goods, inaccurate duty payments, increased costs, reassessments and possible penalties – spend time to get it right and consider a ruling when it’s complicated.

2.     Government Agency Authority:

Clearing Customs isn’t always the only obstacle; be aware of agencies that regulate your goods and what their requirements are; to save time, precious resources and unexpected costs:

  • Your product may be subject to reporting info to Other Government Agencies; (OGA’s).
  • If applicable – be aware of how to satisfy the requirements of CFIA (Canadian Food Inspection Agency), NR Can (Natural Resources Canada), Transport Canada, etc.

3.     Certificates of Origin:

The origin country of your product is as important as HS classification for determining the duties, taxes and fees on imported goods:

  • If products are eligible for preferential duty treatment, a certificate of origin may be required as proof of eligibility and direct shipping may be required; know the rules of transshipment; particularly in an environment of numerous FTA’s (Free or Preferential Trade Agreements).

4.     Trade Compliance Dedication:

Taking trade compliance seriously means engaging senior management; ensure awareness, involvement and understanding of importing requirements/compliance initiatives related to your products; equally the impact of non-compliance on the bottom line.

  • Government auditors typically have interest in whether changes to corporate and regulatory policies are sufficiently communicated.
  • Trade-related training (where applicable) demonstrates internal culture, routines and proficient internal policies to meeting requirements.
  • Develop consistent methods to manage/document compliance; such as alerts, in meetings or website communications.
  • Exploit a combination of training aids to achieve results, depending on your trade compliance complexity.
  • Employ automation — a blend of technology for the most critical core compliance functions can provide reliability and an audit trail pointing to due diligence.

5.     Develop – SOP’s/Terminology References:

Covering all the bases; Importing, exporting, regulations, shipping terms, freight, HS classification, Certificates of Origin and Government Agency demands can become a confusing jumble of abbreviations, acronyms and requirements.

  • Creating a list of/becoming familiar with these acronyms; what they represent and their obligatory measures is an essential platform for compliance and upgrading SOP’s.

The Take Away

International trade can be a daunting world to navigate for the beginner – following these essentials will ensure a terrific foundation and guarantee favorable outcomes, while minimizing risks.



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