Importer of Record Compliance Checklist for Reasonable Care

11 Checklist Items For an Importer of Record to Meet “Reasonable Care”

A stronger working relationship between an importer of record and the U.S. Customs and Border Protection is necessary for the smooth importation process of merchandise with the implementation of new regulations. Reasonable care must be undertaken by companies in the importation of goods into the United States. The U.S Customs and Border Protection is invested to determine the release of items from Customs custody, properly assess duties, collect accurate statistics and decide if the requirements under law are met. If reasonable care is not met, merchandise may be held and audits or penalties can be imposed. Build reasonable care guidelines to comply with the new regulations and move merchandise quickly.

Where Does Reasonable Care Come From?

This change arose from amendments to the Tariff Act of 1930 and related laws. The Customs Modernization or “Mod” Act became effective on December 8, 1993. Responsibility is placed on the shoulders of the importer of record and the U.S. Customs and Border Protection to meet the expectations.

What Are the Requirements of an Importer of Record?

Documentation is provided by the Customs and Border Protection to provide guidance on determining whether or not an organization is meeting reasonable care standards. The CBP offers general details that can be reviewed as they are provided in documentation explaining expectations and the considerations to be met to be compliant. Neglecting to review commercial invoices and other import documentation will cost importers.

Reasonable care is expected to be exercised by the importer of record. They must complete and detail import documentation, include the country of origin verification, marking, and labeling, tariff classification, valuation and duty rates. Importers should detail the quantity of items and adhere to free trade agreements, comply with other government agencies and keep accurate records. Customs brokers or other parties who do not have all of this information cannot get goods to a business or destination as they can be held or delayed until requirements are met.

Management of reasonable care can be done independently or with an expert such as a licensed Customs broker, accountant or attorney. The expert must be qualified. It is mandatory that the firm be licensed and the individuals should have experience in CBP processes. Hiring an expert does not protect a business from being held accountable in the case of an audit.

11 Things an Importer of Record Can Learn About the Process of Reasonable Care

There are a number of things that businesses can do to meet requirements:

Read about the U.S. importer of record requirements. A useful publication is What Every Member of the Trade Community Should Know About: Reasonable Care.
Investigate into government requirements in regards to a specific type of product.
Save the link to the online Harmonized Tariff Schedule for reference.
Retain a licensed expert for consultation and guidance.
Document processes for classification, valuation, origin verification, etc. Train and provide procedures for employees to be compliant. Simplify procedures and vet them through an expert.
The creation of a tariff database for key players to use will minimize errors. Review and update the database as necessary.
Have purchase order instructions that match invoice requirements. Use the language and answer the questions that must be met.
Stay informed about requirements. Attend trade shows and read related literature about developments.
Review invoices and documentation to adjust for compliance.
Depend on more than one set of eyes. Brokers and vendors can make mistakes. It is the responsibility of the business owner to review entries and create processes that reduce the possibility of reoccurrence.
Set up clear and comprehensive recordkeeping. Know the documents to be kept, how they should be stored and how long they should be kept.

There are a number of internal processes that must be created to be compliant, used by all parties and updated with developments. Change is a necessary part of doing business and shipments on a global scale require multiple parties that can work together to be compliant in a streamlined way that utilizes effective communication. Missteps and errors cause delays, penalties and the possibility of an audit. Clear processes and experienced partners can help make importation easier and maintain customer relationships.

Need A Hand as an Importer of Record?

This can be an overwhelming process. With multiple shipments coming from international suppliers, it is beneficial to have someone to work through and streamline a process that will be compliant and comprehensive.

Flash Global’s team of experts located in over 80 countries can move critical parts across customs smoothly and efficiently. They build processes based on a business’s specific needs, mitigate issues and allow access to view the entire process as part of the pipeline. Rely on their expertise in IOR/EOR to get products where they need to go by expected deadlines. Invest in the experience of a partner such as Flash Global to facilitate the importation process.