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The new CBP ruling all eCommerce retailers should know about

Apex Logistics by Apex Logistics
August 18, 2020
in News
Reading Time: 2 mins read
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Apex Logistics International Customs Brokerage Department, led by Executive Vice President, Customs & International Trade, Steve Story, just became a profile in eCommerce retail history. After waiting two years from  their initial CBP Ruling request , Customs & Border Protection (CBP) has issued a breakthrough ruling which expands CBP clearance of eCommerce packages for overseas individuals and companies (non-resident importers).  Story, (previously Chief Executive Officer for Global Trade Solutions) and his team submitted the CBP Ruling Request to the Office of Regulations & Rulings (ORR) to permit DUTY FREE clearance of low value shipments (valued less than $800 USD) via the §321 exemption (19USC §1321),  to online fulfillment centers & eCommerce marketplaces.

The guidelines were recently published via Cargo Systems Messaging Services (CSMS) #43534680., outlining the ruling that applies to both Manifest Cargo Release & Entry Type 86 (ET86).

“Now, an overseas shipper can act as a non-U.S. resident importer and be the consignee on the §321 manifest and the consignee for Customs entry,” explains Story. “This is a game-changer for the §321 industry.”

Why it matters?

Even after Amazon fundamentally changed consumer expectations, our on-demand delivery culture is even more hypercharged by the COVID-19 healthcare crisis. Retail numbers are back on the rise, however; the pandemic has reduced foot traffic to brick-and-mortar locations. The online marketplace has a dominating, captive audience, and with this ruling, the proverbial floodgates are open for non-domestic shippers to stock their merchandise at US fulfilment centers and US Amazon FBA locations.

How it works?

The change permits overseas shippers to be non-resident importers for §321 eligible merchandise and be the consignee on the §321 manifest and for ET86 to ship in care of online distribution fulfillment centers – letting the merchandise owner have ample stock ready-to-ship immediately after purchase.

“For example, Jane Doe is the shipper on the manifest with a overseas address and is also the consignee name on the manifest,” Story explains. “The consignee address on the manifest appears as C/O the distribution center location. Basically, Jane is shipping to herself – the merchandise owner – to reserve stock that is ready to ship immediately once purchased online.”  As there is no sale upon import, the overseas shipper/seller retains ownership of the merchandise and meets the definition of “person” for the §321 exemption.

This caveat enables non-domestic shippers to ship to themselves and store merchandise duty-free until sold.  Without the burden of duty and taxes, now international shippers can pass the savings on to consumers to remain competitive and respond to industry dynamics ripe with disruption.

How to find out more

To discover more about the new ruling and learn how it can be applied to your shipments, contact the Customs Brokerage team at Apex Logistics International Inc at [email protected].

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