International trade is usually complex due to regulations, compliance issues, exchange rates, trade barriers, tariffs, transportation costs, trade agreements, etc. These processes are enough to make international transactions time-consuming and pretty cumbersome. This is where an importer of record comes into play.
An importer of record ensures that all legal requirements from the destination country are met upon the shipment of goods. As such, importers of records are usually based in the destination country to ensure that goods are received at their destinations without hitches. As you read further, you’ll discover more facts about an importer of records.
What Is An Importer Of Record?
The term importer of record or IOR refers to an individual or entity based in the destination country of exported goods. The main duty of this individual is to ensure that exported and imported goods meet the legal necessities of the destination country. They do this by ensuring that the goods get their right values.
Furthermore, they ensure that relevant duties and taxes are paid and all export permits and documents are properly filed. This set of individuals is also referred to as Declarants. This is because they play a significant role in terms of customs compliance.
Who Can Serve As An Import Of Record Or Declarant?
What it takes to act as an import of record or declarant varies with the requirements of different countries. It usually takes a consignee to carry out the job of an import of record. A consignee is the owner of the imported goods at arrival time.
When the transactions are not very straightforward, a broker or an agent will be necessary for the position of an import of record. If these individuals are absent, you will need a legal entity to stand in for them as the import of record.
This legal entity is usually situated in the destination country.
Significance of an Import of Record
Controversies or confusion may arise as to who owns the imported goods. This usually occurs when the dealings have to do with distributors, suppliers, and end-users. This is where an importer of record steps in.
Assigning an importer of record is the easiest way to prevent such a situation. How? Assigning an IOR places them as the temporal owner of the imported goods. They maintain this position until the rightful owner comes to claim the goods. It can be an end-user or a distribution center.
Import of Record Functions?
An import of record has ample responsibilities, which are also significant to the shipment transactions. Sometimes, a bill of lading agency is employed to cut the workload. Such an agency will bear the burden of providing a perfect bill of lading data for your business.
These data will identify, analyze, and execute understandable business opportunities.
Some key functions of an import of record include:
- Providing and securing payments for taxes, fees, and duties on imported goods.
- Examining duties on imports as regards the classification and value of imports.
- Ensuring all federal, state, and local rules for imported goods are met.
- Ensure the required authorization, licensing, or certification for imports are secure. There’s a need for special licenses and permits in a situation where the imported goods are under the regulations of the FDA, DOT, EPA, etc.
- Make sure that the entry documents of the imported goods are accurate. This is particular to filing the Entry Summary (Border Protection form 7501) and the US Customs.
- Providing necessary assistance in securing imports custom bond paperwork.
- Making references to tariff database as required and dealing with tariffs.
- Ensuring that import records last up to 5 years after successfully importing into the United States.
- Assigning a legal Power of Attorney in a case where the importer is absent upon delivery.
- Preparing for the United States Border inspections and audits, etc.
The above tasks are crucial, and failure to execute them or executing them wrongly usually attracts severe consequences. For illegal withholding of goods, there’s a daily fine attached. Seizing goods and harsh financial penalties are some of the severe punishments for improper conduct.
Finding an Import of Record
If you wish to act as an import of record, it’s essential to know the ethics of the job. That is what you need to do for a successful import of record task.
If you need to hire a third-party firm, ensure to present all the vital data regarding the shipment. Hiring a reliable third-party organization to handle the task of an import of record and other bills of lading tasks is the best option. This is because they help to reduce the intensity of the shipment tasks.
However, you must ensure security if you use a third party for your shipment transactions. A perfect option you can opt for is ImportDoor. They are dedicated to offering a robust but simple solution to help you find the right importers, distributors, suppliers, etc., for your business.
Does The Import Of Record Own The Goods?
Usually, the import of record takes ownership of the imported goods. However, this ownership is temporal with specific durations. The durations may differ with different shipment cases, and most times, the Incoterms of the shipment determine the period of ownership.
There are cases where the final recipient of the imported goods is the import of record. In such a situation, the Incoterms will need to carry out a permanent transfer of imported goods.
For instance, in the case of FOB shipment, once the goods are boarded onto the ship, ownership moves to the IOR. Also, in the case of a third party shipment, at the time of departure, the third party takes ownership of the goods. This remains the case until the Incoterms make the transfer of ownership to the final recipient.
Conclusion
The role of an import of record remains critical during and after a shipment. Several functions of an IOR include the provision and security of taxes, fees, and duties on imported goods.
Also, an import of record ensures all federal, state, and local rules for imported goods are met. Lastly, an IOR provides necessary assistance in securing imports, custom bond paperwork, etc.
