A Complete Guide for Importing into the US

America’s economic engagement with the world is a critical determining factor for its economy’s continued robust growth.  Being the world’s largest economy, the US has remained globally competitive by promoting global trade beyond its borders. It has been estimated that nearly 39 million American jobs depend on trade, helping fuel the country’s economic growth. 

In 2019, the total US trade with foreign countries was $5.6 trillion, of which $3.1 trillion was in imports of goods and services and $2.5 trillion in exports. Clearly, the United States imports more than it exports, giving American companies access to raw materials, products and services that may be difficult to source in the domestic market.

Imports also bring other real benefits to Americans, including lowering the cost of manufacturing, improving the quality of life and helping businesses retain their global competitive advantage. Additionally, imports help meet the growing consumer demand for fresh produce and other specialty products that are not available in the US market in large quantities.

US Customs and Border Protection, or CBP, within the Department of Homeland Security (DHS), is the primary agency designated to monitor and regulate the smooth flow of imported cargo through US ports of entry. Besides protecting Americans from global terrorism threats, the enforcement organization is also charged with ensuring that counterfeit products and unsafe imports don’t enter the country.  CBP is vigilant about the authenticity of imports that enter the country and strives to have a balanced relationship with the import community based on the principles of “shared responsibility.” 

Essential Terminology

Importation: Goods that enter the US from overseas are considered an importation and must be cleared by CBP.

Importer of Record: An importer of record is the entity or individual who is responsible for all entry documents required by CBP (Customs Border Protection) and for the product classification and payment of duties, as well as any other import obligations.

Ultimate importer: The individual or company that purchases goods from an overseas supplier, CBP considers them the ultimate importer. The ultimate importer can clear the goods or have a customs broker clear goods on their behalf.

Customs Brokers: They are private individuals or firms licensed by CBP to prepare and file the necessary customs entries, arrange for the payment of duties found due, take steps to effect the release of the goods in CBP custody, and otherwise represent ultimate importers in customs matters.

Identification number: The ultimate importer's identification number is either the Employers Identification Number (EIN), the tax identification number assigned by the Internal Revenue Service(IRS), or the social security number (SSN) in case the ultimate importer is an individual. 

Formal entry: A formal entry is usually required for commercial importations valued over USD 2,500.

Informal entry: Goods are cleared informally, usually when they are for personal use, under USD 2500 in value, and are not in commercial quantities.

Foreign Trade Zones (FTZs): They are the United States’ version of free trade zones. FTZs are designated areas within the US that are legally located outside of the customs territory of the United States, meaning that goods that reside within an established FTZ haven’t yet cleared customs.

Do you Need a License to Import into the US?

The US is an import-friendly country, and in most cases, a license to import goods into the US is not required. However, for certain restricted commodities being imported, some agencies may require a license, permit, or other certification. Further, a special license may be needed if the commodities imported are regulated by Partner Government Agencies (PGA).

Customs brokers who are engaged to clear the goods on behalf of the ultimate importer have to put the latter’s identification number on the Entry Summary CBP Form 7501 However, if a formal entry is not required for goods, then the Entry Summary CBP Form 7501, bond, and identification number are not required. However, it is advised that brokers have the ultimate importer’s identification number at all times

Documents Required for Customs Clearance

Proof of IRS: It is typically an EIN for business entities and an SSN for individuals

Customs bond:  It is a binding contract required by CBP for all commercial imports valued at USD 2500 or more. Import shipments that contain goods regulated by PGAs must also be covered under a customs bond. Bonds can be obtained in two forms: single and continuous

Importer Security Filing (ISF): It is a document(also known as ‘10+2’) that is only required for shipping via ocean.  It is mandatory to do ISF 24 hours before goods are loaded onto the ship, as per the CBP guidelines. If you fail to meet the deadline in filing the document, it may result in financial penalties leading to delayed cargo, and more inspections

Shipping documents: It may include but is not limited to a commercial invoice, a bill of lading or airway bill, a certificate of origin, and a packing list

Government certifications: Additional permits may be required for customs clearance for goods that need to be cleared by a PGA

Key Steps in the Process of Imports in the US:

Make arrangements at a CBP Port of Entry: Prior to arriving in the US, arrangements must be made for the goods at the CBP Port of Entry where they will arrive. This will also be where duties and documentation will need to be filed.

File entry documents: When a shipment reaches a US port of entry, the importer of record will file entry documents for the goods. In case of an air shipment, the importer of record must be stated on the bill of sale as well as the bill of lading. Entry documents must be filed within 15 calendar days of the date when the shipment arrives at a US port of entry. 

Entry summary: This is a necessary document as it enables CPB to assess duties, gather statistics, and determine if all legal requirements have been met.

Assessment/Payment of duties and tariffs: All imported merchandise into the US are subject to duty or duty-free entry in accordance with their classification. Rates of duty may vary depending upon the country of origin. 

The importer submits an invoice and packaging list detailing all the goods, their transaction value, country of origin along with other information. The CPB then assess tariffs or duty to be paid by the importer before goods are released. There are special rules for goods imported by mail. 

Entry for warehouse: The goods can remain in the bonded warehouse for up to five years from the day of importation and withdrawn at any time with the payment of applicable duty. At any time during that period, warehoused goods may be withdrawn for consumption upon paying duty at the duty rate in effect of the date of withdrawal. If the goods are destroyed under CPB supervision, no duty is payable. 

Examination of goods: CBP has the right to examine the goods at random.  The shipment is released subject to the absence of legal or regulatory violations.

Invoices: A commercial invoice, signed by the seller or shipper, or his agent, is acceptable if it is prepared in accordance with CBP regulations. Key elements in a commercial invoice (not an exhaustive list) include:

• The country of origin
• US port of entry
• Names of buyer and seller
• A detailed description of the merchandise
• Quantities in weights and measures
• The purchase price of each item and the currency of the sale

Undeclared Goods: If the importer wishes to delay the release of goods, the shipment may be placed in a general warehouse at the importer’s expense. The goods may be destroyed or sold at a public auction if there is no claim made within six months from the date of importation. 

Liquidation: The imported goods are appraised after the CBP officers at the port of entry review their valuations. The entry summary and documentation may be accepted as submitted without any changes. In this situation, the entry is considered liquidated. 

Ruling on import duties: CBP makes a decision on the dutiable status of an item once the entry is liquidated.

Prohibitions and restrictions: Certain merchandise categories may be prohibited or restricted from entering the US to safeguard consumer health and well-being and preserve domestic plant and animal life. Some commodities are also subject to an import quota.

Top Ten Categories of IPR-infringing Products

In 2019, CBP and U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI) seized 27,599 shipments containing goods that violated Intellectual Property Rights (IPR).

The following items lead the list of imported products that violate IPR regulations in the US: 

• Pharmaceuticals
• Health/ personal care
• Eyewear/parts
• Critical technology components
• Electronic articles
• Cigarettes
• Perfumes/ colognes
• Batteries
• Exercise equipment 
• Transportation/parts

A “Reasonable Care” Checklist for Importers to Avoid Compliance Problems

(Note: The list is advisory and not exhaustive) 

CBP recommends that importers examine the following questions to ensure that they are complying with the rules and regulations for importing into the US:

• Are you complying with CBP requirements, and do you understand the rules and regulations for import transactions?
• Have you reviewed your CBP documentation for accuracy?
• Have you provided an accurate description of your merchandise?
• Have you provided CBP with the correct tariff classification of your merchandise?
• Have you provided CBP with a proper declared value for your merchandise?
• Have you conducted a compliance assessment to manage supply chain risks?
• Are you aware of the benefits of using a Foreign Trade Zone (FTZ)?
• Are you aware of the laws and regulations to safeguard US Intellectual Property Rights?

If you are seeking to import goods into the US, do review the above information before initiating the process. At Trademo, we provide global trade data solutions for businesses. To know more about us and our product,

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