Trade facilitation strategies for global supply chains

1. page 1
Deep SenGupta
Principal
Trade & Customs Advisory Services
Trade facilitation strategies for global
supply chains

2. FedEx Trade Networks
• FTN Transportation & Brokerage, Inc.:
• World Class Customs Brokerage
• Global Shipping Solutions
• FTN Trade Services, Inc.:
• Trade Facilitation Tools (“WorldTariff”)
• Trade & Customs Advisory Services (“TCAS”)

3. Our Service portfolio
 TCAS:
 Import & Export compliance
 Compliance Evaluations & Manuals
 HTS/HS Classification
 NAFTA & other Free Trade programs
 Cargo Security Initiatives: C-TPAT, FAST, ISA
 Training on International Trade issues
 WorldTariff: Worldwide duty & tax

4. Why are our customers interested in
our services?
 Save Money!
 Reduce avoidable penalties
 Not overpaying customs duties
 Save Time!
 Fewer cargo exams
 Fewer delays

5. Compliance
page 5
Our Agenda For Today
Companies that are engaged in International
trade should make every effort to mitigate:
– Landed cost & customs duties
– Shipment delays
– Avoidable import & export penalties

6. Compliance
page 6
Benefits of Compliance
• Doing it right the first time is cheaper than going back
and fixing it later
• Demonstrated compliance will result in:
– Fewer cages & intensive cargo exams
– Fewer penalties
– Fewer information requests, and
– Fewer delays resulting in less cost
• Less cost + Less customs processing time = Greater
competitive advantage in the marketplace.

7. 7
Import-Export Compliance Quiz
i. Do you have a Import-Export compliance department?
ii. Do you have a Compliance manual to address the handling
of Import-Export activities?
iii. Are entries reviewed for accuracy (dutiable and non-dutiable
costs , proper duty rates) and are discrepancies brought to
Customs’ attention?
iv. Are your products properly classified with a 10-digit HTS
number?
v. Are you confident that you are not over-paying or under-
paying customs duties?

8. 8
vi. Do your employees receive annual training on Import-Export
procedures?
vii. Are internal audits performed frequently?
viii. Have you taken all necessary steps to implement a cargo
security program?
ix. Do you feel confident that your company could withstand a
Customs audit ?
x. Are you maximizing your participation in lawful duty reduction
programs (such as duty drawback, Foreign Trade Zones or
Free Trade Agreements/NAFTA)?
STOP! If you answered “NO” to any of these questions, then your
company is taking regulatory risks.
Import-Export Compliance Quiz

9. Compliance
page 9
Customs Duties

10. What is your Landed Cost ?
In addition to the basic cost of an item, the
ultimate cost of delivery may include
 Customs duties
 VAT/GST
 HMF/MPF
 Brokerage fees
 Cost of special packaging
 Drayage & Ocean shipping costs
 Port handling fees

11. Compliance
page 11
Customs duties and import taxes
• Do I currently know how much customs duty my company
pays?
• Do I know how the duty is calculated?
• Am I satisfied that duty assessments on my business are
correct?
• Can I be more efficient if I pay attention to customs
planning?
• Am I confident that I am importing my products under
the correct Harmonized Tariff System (HTS) code?

12. Benefits and Uses of WorldTariff
• Save Money by planning ahead
• Achieve global compliance while streamlining the
import process
• Make more informed international business decisions
• Improve product planning & global sourcing decisions
• Available online at www.worldtariff.com
• Only $7 a query

14. © 2005 WorldTariff SM All Rights Reserved.

15. Compliance
page 15
Reduce Shipment Delays

16. 1/25/10
Compliance
page 16
Suspect Areas
VACIS Image of Tank Car Loaded with 1,157
Kilos of Marijuana

17. 1/25/10
Compliance
page 17

18. 1/25/10
Compliance
page 18

19. 1/25/10
Compliance
page 19

20. 1/25/10
Compliance
page 20

21. 1/25/10
Compliance
page 21

22. Compliance
page 22
Reduce avoidable penalties

23. Tips to avoid customs clearance delays
1. Provide information that is complete and legible
2. Correctly complete all necessary documents, keeping your
answers specific, accurate, and free of spelling errors
3. Keep your information consistent across all documents
4. List each commodity separately; providing a detailed and
accurate description of each commodity, including what it's
made of and how it will be used.
5. If available, provide the HTS or HS number.
6. Legibly print the commodity's country of origin/manufacture,
indicating where your commodity was manufactured, grown or
produced.
7. Provide phone number or fax information for the sender and
consignee.

24. Import: Top risk areas
1. Customs Valuation
2. HTS Classification
3. Free Trade Agreements / NAFTA
4. Country of Origin marking
5. Recordkeeping

25. Export: Top risk areas
1. Know your product’s ECCN number:
Shipping without an export license
2. Know your ultimate customer: Shipping
to an embargoed destination
3. Restricted party screening
4. Filing the Electronic Export information
for shipments above $2500 (except to
Canada)
5. Recordkeeping

26. Compliance
page 26
Export administration regulations:
Fines and Penalties
Criminal Penalties:
• Maximum of five times the value of the
export/re-export or $1,000,000 (whichever
is greater).
• In the case of an individual, a fine not
more than $250,000, or imprisonment not
more than 10 years, or both.
Civil Penalties:
• $250,000 (maximum) imposed for any
EAR violation
Denial of Export Privileges

27. Compliance
page 27
Thank You!
CONTACT INFORMATION
Deep SenGupta
Principal
Trade & Customs Advisory Services (TCAS)
Mobile: 1.415.385.4894
E-mail: deep_sengupta@ftn.fedex.com