Cross-border e-commerce export customs declaration _ import customs clearance process and precautions

Cross-border Logistics Basic Knowledge Literacy Guidebook

Learn about the important aspects of cross-border logistics, common logistics transportation methods, and Amazon logistics solutions.

1.2 How to choose a cross-border logistics model?

An important part of cross-border logistics - import and export customs

Introduction to import and export customs

After you create a cross-border logistics order, you need to carry out export customs clearance in accordance with customs requirements before shipping according to the mode of transportation, and import customs clearance when the goods arrive in the destination country. Through the image below, you can understand the entire process of goods in cross-border logistics from the creation of a logistics order to transportation to the destination country.

As can be seen from the image above, when you use cross-border logistics to transport goods, the two steps of export customs declaration in the country of origin and import customs clearance in the destination country are essential. Therefore, you must prepare in advance the matters that need to be paid attention to in import and export customs before shipping, so that the goods will not be seized or returned by customs and the transit time will be extended. Next, I will give you a detailed introduction to the preparations involved in export customs declaration and import customs clearance, respectively.

Preparation for export customs

Customs declaration is one of the necessary steps in carrying out customs export procedures. As a seller, you need to prepare ahead of time before shipping so that your customs brokerage business can do more with less. The following will show you what documents you need to prepare for export customs.

Documents required for export customs declaration

Regardless of the shipping method you use, you need to prepare the following documents before shipping so that you can provide the corresponding documents for customs inspection during export declarations.

Export goods customs declaration

It means that the documents that the seller fills in with the customs when exporting goods have certain legal effect after being checked and confirmed by the customs. It is an important evidence for export products to be declared and left the country, and it is also an important document for processing tax refunds for export products.

Export packing list

Goods need to be packed before they are exported for shipment. The export packing slip is proof of the packaging of the goods.

export invoice

Since it is impossible to uniformly use export-specific invoices supervised by tax authorities in international trade, export invoices are currently only used for tax refunds when declaring exports.

Authorization letter for customs brokerage

It refers to a written certificate that shipper 1 entrusts Carrier 2 (agent) to handle customs clearance matters such as customs declaration and clarifying the responsibilities and obligations of both parties.

Export packing list

In accordance with the “Customs Law of the People's Republic of China” and the requirements of relevant laws, administrative regulations and rules, the consignee and consignee of imported and exported goods and authorized customs brokers report to the customs the correct situation of the actual imported and exported goods in the form of electronic data declarations and paper customs declarations at the specified time and place, that is, a declaration. The customs declaration involved in the period is the declaration element of the declaration.

Note:

The above customs documents are for reference only. Customs requirements in different countries and cities may vary. It is recommended that you consult a professional customs broker, subject to the actual situation.

1. Shipper: Also known as a “shipper”, is a social organization or individual who entrusts a carrier to deliver goods and pay freight.
2. Carrier: means a person who enters into a contract of carriage of goods with a shipper by itself or by entrusting another person in his name.

If you use air transportation, then in addition to the above documents, you also need to prepare the following information and documents for export customs:

● SHIPPER (shipper) information: Chinese/English title required, letter of social credit (for overseas companies, please provide registration number);

● CNEE (consignee) information: An English title (i.e. Bond title), EIN 1 (or VAT 2 number) is required;

● Air export transportation contract;

● English version of the invoice and packing list;

● Air Bill of Lading 3;

● Wood products need to be fumigated 4 times and provide a factory inspection certificate;

● If your product involves dangerous goods, you also need to provide the following documents: Air Freight Guarantee 5, MSDS 6, Battery Letter 7, KC FORM 8, FDA REG# 9 , a list of devices.

● Read Chapter 2:2.5 Export Customs Preparation of the Amazon Cross-border Logistics Service Guidebook to learn more about sample documents and details required for export customs clearance. Click here to see the route.

Precautions for export customs

Tips:

When you carry out export customs clearance business, if you need a customs broker to help handle related matters, please ensure that you entrust a professional customs broker.

Explanation of abbreviations

1. EIN: Exporter Identification Number, or Exporter Identification Number, is an exporter identification number. European customs issues an identification number to the exporter, and the seller must provide a unique customs identification number before releasing the goods.
2. VAT: The full name Value Added Tax is a commonly used value-added tax in EU countries. A VAT number is a tax identification number at the time of tax payment. Sellers can only pay taxes after registering a VAT number, and can apply for import VAT deductions after shipping.
3. Air bill of lading: means a cargo receipt issued by the air carrier (airline) or its agent carrying the goods to the shipper after receiving the cargo and accepting the shipper's air freight request.
4. Fumigation: In order to prevent harmful diseases and pests from harming the forest resources of importing countries, export goods containing wooden packaging must be disinfected before shipping. Fumigation is a method of pest control treatment.
5. Air transport guarantee: A guarantee issued by the shipper to guarantee that the consignment of goods is not dangerous goods as stipulated in aviation safety regulations. It takes effect after being stamped with an official seal.
6. MSDS: The full name Material Safety Data Sheet, or Chemical Safety Technical Specification, is a document used by chemical manufacturers and importers to clarify that chemicals may cause harm, and is issued by a nationally recognized professional and authoritative certification body.
7. Battery letter: A certificate required to be filled out when exporting an electrically charged product.
8. KC Form: The full name Know Consignor Form, or Air Transport Non-Dangerous Guarantee, refers to a letter of guarantee issued by the shipper to guarantee that the goods are not dangerous goods as stipulated in aviation safety regulations. It takes effect after being stamped with an official seal.
9. FDA REG #：即 FDA registration number refers to the number obtained when cosmetics, medical devices, food, OTC drugs and other products are exported to the US and must be registered with the US Federal Food and Drug Administration.

Preparation for import customs clearance

Before you import goods into the destination country, you must first ensure that you have your IOR in the destination country. IOR, the full name of Importer of Record, is a registered importer. It is responsible for ensuring that your goods comply with local laws and regulations when importing, and pay import taxes so that the goods are successfully imported into the destination country.
In addition to the IOR, each country has different requirements for customs clearance according to the corresponding customs regulations. Next, I will introduce you to the import customs clearance process using the US, Europe, and Japan as examples for reference.

US Customs Clearance Precautions

Importing goods into the US will go through the following processes:

Through the above process, you'll find that if you need to import goods to the US, you must purchase a bond and apply for a POA in advance to complete customs clearance. So what do bond and POA mean, respectively?

● Bond is the full name Custom Bond, that is, a customs deposit. When the importer incurs expenses due to trade disputes, etc., the US Customs can deduct money from the bond, and the US Customs and government require that the US importer must purchase it. Bonds are divided into annual bonds (that is, annual bonds) and single bonds (that is, single bonds);

How do you choose between an annual bond and a single bond?

● Annual Bond

① You only need to buy it once a year, suitable for importers who regularly import goods;
② The amount is USD 50,000, and each time it is deducted according to 5/1000 of the declared value of the goods.

● Single bond

① Each time it is deducted according to 8.5 thousandths of the declared value of the goods, and there is a Single ISF Bond fee each time;
② Sellers can make online purchases directly when creating a shipment in Amazon Seller Central
(The cost is about 140-150 US dollars each time)

● POA, the full name of Power of Attorney, or Import Clearance Authorization Letter, indicates that the US Customs Service informs the seller that the seller has authorized the customs clearance agency designated by Amazon to act as an agent for customs clearance. Sellers can apply for POAs and purchase bonds through a customs broker agent. If you have already purchased your own Bond at that time, you do not need to make a separate purchase; you only need to apply for a POA;

● Read the second chapter of the Amazon Cross-border Logistics Services Guidebook: 2.6 Import Clearance Process to learn more about bonds and POA. Click here to see the route.

EU and UK customs clearance considerations

EU and UK customs clearance are slightly different from the US. The figure below includes the process involved in European customs clearance and is for reference only.

With the image above, I believe you have a rough idea of the European customs clearance process. So what do the VAT and EORI mentioned in the picture mean?The answers will be provided below.

To sell products to Europe, you must prepare two numbers, one is a VAT number and the other is an EORI number

Wait a minute!What do these two numbers really mean?

● The full name of Vat is Value Add Tax, which is a value-added tax generally applicable in European countries

Cross-border export e-commerce businesses are required to pay import value-added tax during customs clearance of goods. The VAT number is the tax identification number at the time of tax payment. Once the seller has registered a VAT number, they can apply for import VAT deduction after shipping.

● The full name of EORI is EconomInc Operators Registration and Identification, that is, economic operation registration and identification number

Starting from January 1, 2021, the UK will officially leave the EU Single Market and Customs Union, and a customs border will be set up between the UK and the EU. If you plan to place your product inventory in the UK and any EU country, you need to register the UK and EU EORI numbers separately. The UK's EORI number is only applicable to the UK, and any country's EORI number can be used in EU countries.

So what's the difference between a VAT number and an EORI number?

● VAT numbers need to be registered through a tax agent with relevant qualifications. If sellers need to ship goods to multiple European countries, they need to register VAT numbers for multiple countries

● An EORI number is usually applied for by a tax agent when applying for a VAT tax number. The UK's EORI number starts with GB. It only applies to the UK. It can only be used in the UK. It can be used in EU member states.

Note:

● Sellers send products to the UK, and when importing and clearing customs in the UK, they need to provide the UK VAT number and EORI number;

● When the seller sends the product to an EU country, when importing and clearing customs, they need to provide the VAT number of the corresponding EU country and the EORI number of any EU country;

● Using Amazon's cross-border logistics service to ship products to sellers in the UK or Germany, Amazon can support sellers without a registered UK or EU entity to carry out import customs clearance, but they must have the destination country's VAT number and EORI number; read the Amazon Cross-border Logistics Service Guidebook Chapter 2:2.6 Import Customs Clearance Process for more details. Click here to see the route.

Japan Customs Clearance Precautions

If you already have an IOR, or registered importer, you can send goods from abroad to Japan, as long as you ensure compliance with Japanese laws and regulations. However, if you do not have a Japanese entity, or a Japanese entity in Japan that can act as a registered importer, then you will need to appoint a service provider as your Customs Procedure Agent (ACP).

● ACP: Attorney for the Customs Procedures, or Customs Procedure Agent, refers to an entity or individual who can pay taxes on your behalf when importing. Note that ACP is not entirely the importer's responsibility; it is only responsible for taxes. You must ensure that your products comply with local laws and regulations before importing them;

● Generally, any Japanese resident can be designated as a registered importer or customs procedure agent.

Note:

● The above customs clearance precautions are not intended to constitute customs or legal advice. It is recommended that you consult a customs broker or legal adviser before importing, depending on the actual situation;

● You can click here to learn more about Japan's customs clearance precautions; you can also read the official WeChat article “Is it too difficult to “calculate” Japanese tariffs?Tips from 3 experienced Amazon sellers: fast customs clearance, guarantee profits, and find a pace to prepare goods!] & [Strict inspection by Japanese customs!An inverse algorithm for imposing tariffs?Amazon's practical operating advice for emergency relief!] to learn more about the inverse calculation of Japan Customs.

Other customs clearance considerations

Tips:

● Please do not understate or misstate the declared value of the goods during the process of transporting the goods to the destination country. If the above acts are committed, they will face huge fines;

● Please note that when shipping products from outside of Japan to an Amazon fulfillment center in Japan, delivery after tax (DDP means you are responsible for all shipping costs, including taxes) as a shipper/exporter is a mandatory incoterms clause. Please confirm with your shipping company that they accept DDP shipments.

Explanation of terms in this chapter

nouns

paraphrase

Carrier

It refers to a person who enters into a contract of carriage of goods with a shipper in his/her name or entrusts another person.

Battery letter

A certificate to fill out when exporting electrically charged products.

EIN

The full name is Exporter Identification Number, or Exporter Identification Number. Customs issues this identification number to the exporter, and the seller must provide a unique customs identification number before releasing the goods.

FDA REG#

In other words, an FDA registration number refers to a number obtained when exporting cosmetics, medical devices, food, OTC drugs, etc. to the US and must be registered with the US Federal Food and Drug Administration.

KC Form

The full name Know Consignor Form, or Air Transport Non-Dangerous Guarantee, refers to a letter of guarantee issued by the shipper to guarantee that the consigned goods are not dangerous goods as stipulated in aviation safety regulations, and is effective after being stamped with an official seal.

Air freight guarantee

It refers to a letter of guarantee issued by the shipper to guarantee that the consignment is not dangerous goods as stipulated in aviation safety regulations, and is effective after being stamped with an official seal.

Air Bill of Lading

It means a cargo receipt issued to the shipper by the air carrier (airline) or its agent carrying the goods after receiving the goods being carried and accepting the shipper's air freight request.

Shipper

A “shipper” is a social organization or individual who entrusts the carrier to deliver the goods and pay the freight.

VAT

The full name Value Added Tax is a commonly used value-added tax in EU countries. A VAT number is a tax identification number at the time of tax payment. Sellers can only pay taxes after registering a VAT number, and can apply for import VAT deductions after shipping.

fumigation

In order to prevent harmful diseases and pests from harming forest resources in importing countries, export goods containing wooden packaging must be decontaminated before shipping. Fumigation is a method in detoxification treatment.

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