Import

It has been argued that importing is simply the opposite of exporting. An organization or an individual in one country purchases goods and services from a seller in another country with the aim of making a profit in the transaction. There are certain aspects of importing that are unique. For example, tariffs and import [Page 842]quotas are only relevant for the importers. The basics of importing involve customs brokers, import restrictions, terms of sale, foreign commercial payments, foreign trade zones, and customs bonded warehouses.

Customs Brokers

A customs broker is often a private company that operates as a middleman between the department of customs in a country and the importing public. Such a relationship will continue to proliferate as long as there are legal requirements regarding the movement of merchandise between countries. Just like a freight forwarder, the customs broker is a private service company licensed to assist importers in the movement of their goods.

Worldwide, billions of dollars in duty collections are filed each year with the customs departments of numerous countries, and they are all predominantly filed and prepared by customs brokers on behalf of importers. Some brokers are sole proprietors with a single office at one port of entry; others are multinational corporations with branches in many ports throughout the world. Customs brokers may be required to be licensed and regulated, for example, in Australia.

The customs broker is employed as an agent by the importer and is often the only point of contact the importer has with the Department of Customs in the respective countries. It is not necessary for an importer to employ a broker to enter goods on its own behalf; however, a bond is required if the importer chooses to handle entry. Most importers who have been in the business for a long time usually engage the services of customs brokers because of the additional services they offer and provide. These include satisfaction in the knowledge that an organization that knows what needs doing with respect to legislation and government bureaucracy is dealing with those issues for you and can provide the answers to many technical questions. Additionally, the importer's time is more valuable and better spent in managing their organization than dealing with the paperwork involved for the product to gain entry into a country.

A customs broker's duties include advising on the technical requirements of importing, preparing and filing entry documents, obtaining the necessary bonds, securing the release of products, arranging delivery to the importer's premises or warehouse, and obtaining drawback refunds.

Drawback involves refunding import duties that have been paid on imported goods if those goods end up being exported out of the country. For example, re-exporting goods that were originally imported; exporting items that contain imported merchandise; or, exporting items that contain wholly imported components. For each of these different scenarios, an importer could be eligible to claim a drawback of the original tariffs paid when first imported. The key to this opportunity is good inventory management and being able to track and keep a record of the movement of inventory. The broker often consults with customs officials to ascertain the correct rate of duty. If the broker is dissatisfied with the rate, the broker will pursue the appropriate remedy on behalf of the importer.

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