Cross-border Trade: Keeping On Top of Customs Regulations

Here are seven tips to improve regulatory compliance, reduce operating expenses and streamline global supply chains


Here are seven tips to improve regulatory compliance, reduce operating expenses and streamline global supply chains.

Costly delays. Unhappy customers. Big-time regulatory fines.

So how's your day going?

Such problems can cause major headaches for businesses involved in global trade and strike fear into the hearts of those considering the golden opportunities that come with going global.

Without question, in today's complex and constantly changing post-9/11 regulatory environment, managing cross-border shipping is increasingly complicated and risky.

In effect: a bewildering array of rules, issued by more than 200 sovereign nations. Add to that manual processes that are slow, expensive and error-prone. All this comes at a time when the U.S. Customs and Border Protection (CBP) through the Customs Modernization Act pushed responsibility onto importers for compliance with international rules and regulations.

Failure to comply can be costly. For example, from January through October 2004, the U.S. Department of Commerce cited more than 50 U.S.-based corporations for violations. And if a company audited by U.S. Customs has failed to store import records for the required five years, the penalty is $10,000 for each negligent violation and $100,000 for each willful violation.

But, oh, the opportunities. Huge and growing.

Indeed, global trade is experiencing explosive growth, with increasing percentages of manufactured goods sold across borders. And the Internet has helped place global trade opportunities within the grasp of even the smallest businesses. Even folks selling their wares on eBay can now hang a global shingle.

It all adds up to a quintessential risk vs. reward equation. Vital to success is keeping a handle on the regulations and processes that can be confusing and frustrating. Particularly within Primary Focus Industries those identified by U.S. Customs for extra scrutiny reluctance to address them may keep a company from taking advantage of the golden growth opportunity presented by expanding into international markets.

Now for some good news. Services are now available via the Internet (or increasingly via Web services) that enable businesses to navigate and streamline the complexities of international trade. Services that allow movement of goods across borders in a more compliant, timely and efficient manner. Services that, ultimately, can help transform cross-border shipping from a daunting challenge to a competitive advantage.

Take the case of America II Electronics. The St. Petersburg, Fla.-based firm is one of the largest independent distributors of electronic components in the world. The company recently decided to look into implementing Web-enabled tools that would help demonstrate to U.S. Customs that they are proactive and compliant with changing customs regulations.

America II Electronics opted to employ a tool to help U.S. importers clear shipments into the country, audit cleared shipments for correct classification and efficiently archive those shipments.

These tools have helped our Import Department realize a cost savings, and also improved efficiency, said Frank Oliveria, America II Electronics' import coordinator. We now have access to a Web site that allows us to review import documentation and amend information by e-mail immediately, preventing the need to submit amendments to U.S. Customs for imports.

California-based Idea Group recently took advantage of a product that consolidates shipments from international factories into a single freight shipment, quickly clears them through Customs as a single unit, then places them directly into a U.S. ground network for final delivery, bypassing a distribution center.

The result: Idea Group shaved two weeks off the time it takes to get its promotional products from China to customers in the United States, with one point of contact and a single bill.

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