Many of my clients are hard-working owners or operators of small businesses. They don’t have in-house compliance or logistics expertise, so must wear several hats. Day to day activities or unexpected issues take up most working hours. As a result, functions such as logistics planning and import/export compliance are often unmanaged or left entirely to LSPs (Logistics Service Providers).

Making sure that your business is in compliance with import and export regulations is good risk management as well as good business. Think of it as insurance. A few basic steps can make a big difference and can be implemented quickly.

Ad Hoc Logistics can provide step by step guidelines, train your employees, and set up sustainable procedures. Our copyrighted programs include:

Exporting for Smart People- Because You’re No Dummy

Red Flag Screening

A to Z of Managing Logistics

Contact mitch@adhoclogistics.com for info.

Mitch Kostoulakos, LCB commented on this

Nadeem Virk, LCB• 2ndUsing Trade Compliance to Help You Grow | Licensed Customs Broker (LCB) | Founder and CEO @ VTC5h • 

If you have a couple of year’s worth of trade compliance experience, that LCB designation isn’t going to boost you up that much.

Mitch Kostoulakos, LCB Ad Hoc Logistics LLC, Licensed Customs Broker, International Logistics Consultant

Curious post. As an LCB you know how difficult it is to obtain the license. Why de-value the accomplishment?

We are happy to be traveling again after a 2 year hiatus. Just returned from Newfoundland and Labrador with memories of a spectacular landscape, friendly people, and excellent seafood. Unfortunately flight delays are a fact of life today. However, Global Entry enabled us to sail through Customs very quickly upon return to the US. We have used it for several previous trips and recommend it to travelers.

https://www.cbp.gov/travel/trusted-traveler-programs/global-entry

Next up Montreal and Quebec City!

David Noah• President at InterMart, Inc.

Most exporters use freight forwarders to manage international transportation for their goods. But, especially with shipping costs on the rise, you may wonder if you could save money by booking container space on your own. Consider these four points first.

Mitch Kostoulakos, LCB Ad Hoc Logistics LLC, Licensed Customs Broker, International Logistics Consultant

There is really no advantage to going it alone with the possible exception of large multi-national corporations. For all other exporters it is best to develop strong freight forwarder relationships.

Nadeem Virk, LCB• 2ndUsing Trade Compliance to Help You Grow | Licensed Customs Broker (LCB) | Founder and CEO @ VTC4h

If you can understand the overall idea of a topic in trade compliance rather than worrying about the details, it will get you very far.

Mitch Kostoulakos, LCB Ad Hoc Logistics LLC, Licensed Customs Broker, International Logistics Consultant

Attention to detail is a critical factor in compliance.

My recent post “Got Alphabet Soup?” covered ECCNs (Export Control Classification Numbers) and EAR99 which is used for items subject to Export Administration Regulations without having a specific ECCN. License determination is the next step in export compliance and I remind shippers that automatically using EAR99 and NLR (No License Required) is risky.

§ 738.4 DETERMINING WHETHER A
LICENSE IS REQUIRED
(a) Using the CCL and the Country Chart
(1) Overview. Once you have determined that
your item is classified under a specific ECCN,
you must use information contained in the
“License Requirements” section of that ECCN in
combination with the Country Chart to decide
whether a license is required. Note that not all
license requirements set forth under the “License
Requirements” section of an ECCN refer you to
the Commerce Country Chart, but in some cases
this section will contain references to a specific
section in the EAR for license requirements. In
such cases, this section would not apply.

Contact mitch@52.91.45.227 for help with export regulations.

Applicants who passed the April 2022 CBLE (Customs Broker License Exam) are, no doubt, anxiously awaiting issuance of their license. This question from previous exams illustrates part of the process:

Below are the basic requirements to obtain an individual broker’s license EXCEPT:

A. Be a citizen of the United States
B. Not be an employee of the Unites States government
C. Be at least 18 years old at the time of submission of license application
D. Be of good moral character
E. Obtain a passing grade of 75% on the Customs Broker License Exam (CBLE)

The correct answer is C as applicants must be at least 21 years of age. As for D how does CBP judge moral character? An extensive background investigation as noted by CBP:

Each broker license applicant must undergo a background investigation that includes a fingerprint analysis and a review of character references, credit reports, and any arrest record. Arrests or convictions do not necessarily preclude the issuance of a license.

Licensed Customs Brokers are responsible for the assessment and potential collection of revenue for the United States in the form of duties and taxes. They must also ensure that they and their clients comply with the laws and regulations in all transactions. So the background check is more than a mere formality. Be patient applicants!

Clients often say “we’ve used the same harmonized codes for years” and “our products are duty free“. As a Licensed Customs Broker and consultant this tells me that I need to do some checking on the client’s behalf. Using obsolete or invalid HTS (Harmonized Tariff Schedule) codes is a sign of an amateurish operation. It is likely that, for these clients, commercial invoice descriptions need updating. If they are also an exporter we should check ECCNs, License Exceptions, and Schedule B numbers as well.

The tariff archives show that the 2021 HTS was revised 12 times. The 2022 version already lists 6 revisions. Here are the links to the changes: https://hts.usitc.gov/view/list

Don’t assume that your codes are valid. A little due diligence helps avoid problems down the road. Contact mitch@52.91.45.227 for a review of your HTS codes.

July 1st is Canada Day for our neighbor to the north. Known as Dominion Day until 1982, this is the anniversary of the Constitution Act establishing the nation of Canada.

I happen to be planning logistics for upcoming trips to Newfoundland and Quebec as well as researching Canadian export regulations for a client. As with all countries the regulations require careful reading. However, I have found the CBSA (Canada Border Services Agency) website and tariff to be user friendly and easy to navigate.

https://www.cbsa-asfc.gc.ca/menu-eng.html

As noted in previous posts, HTS (Harmonized Tariff Schedule) or Schedule B classification is the first step in export compliance. Other critical factors are ECCN (Export Control Classification Number) or EAR99, License/License Exception or NLR (No License Required), and Country of Origin. We’ll cover ECCN in this post.

Order of Review– Determine if your commodity is subject to the EAR (Export Administration Regulations). Use BIS decision tree. https://www.bis.doc.gov/index.php/export-control-classification-interactive-tool

CCL (Commerce Control List)– If your commodity falls under the EAR it is either EAR99 or requires an ECCN. EAR99 means that an item is subject to Export Administration Regulations but is not listed with a specific ECCN. Check the CCL. https://www.bis.doc.gov/index.php/regulations/commerce-control-list-ccl

CCL Index- The CCL is not especially user friendly but the CCL Index is a good resource. If you find your commodity in the index you can then dig deeper into the CCL. https://bis.doc.gov/index.php/documents/regulations-docs/13-commerce-control-list-index/file

For help with ECCN classification contact mitch@52.91.45.227