How to Import into the US

Requirements for importing specific commodities depend on a wide variety of things. Some information, such as whether an item is subject to quota restrictions, eligible for reduced rates of duty, or restricted from entry because they originate in an embargoed country, can be determined only if you know the item’s Harmonized Tariff Schedule classification number. Determining an item’s HTS number can be extremely complicated. Please see our information under Duty Rates in the Import section of this web site.

Other requirements depend on other agencies’ safety, energy efficiency, health, etc. standards. Many of the items governed by these various rules cannot be imported without a permit from the related agency. See the chapter on Special Requirements in our publication “Importing Into the U.S.” for more information.
Another thing to consider is marking of county of origin. Everything imported for use in the U.S. must be marked with the country of origin, but some things are very hard, or impossible, to mark, such as diamonds, flowers, or water.
Finally, the distribution of many trademarked and copyrighted items in this country is restricted by contractual agreements that give exclusive rights to specific companies or individuals to distribute the product in this country. If you attempt to import a product covered by such an agreement, it could be seized at the border. For more information please see our information on Intellectual Property Rights.
We have attempted to give some thumbnail guidelines about things to consider in this Q&A format. However, circumstances change every day, and it is advisable to call your local port for specific guidance in importing your particular commodity. We also advise you to review our series of Informed Compliance Publications. They provide very detailed guidance on importing a variety of items, only some of which are listed in the FAQ category for Requirements for Importing Certain Goods.

Question

I am trying to start a business in jewelry and clothes from India. I do not know how and where to start from. I want to make sure I have all the necessary licenses or documents that I may need in order to do this….please advice. Where do I start from? Which licenses do I may need? Any legal documents I may require to prove that I do have a small business in items such as jewelry, clothes home decor, etc. The jewelry is all artificial and clothes are our everyday usage type, nothing pricey or outrageous. All answers are welcome – thanks for your time.

Answer

India is an excellent choice for trading. They have a thriving textile industry (textiles are items made of fabric or cloth like clothing, table cloths, etc.) and are eager to do business with the United States. Before starting your business, you’ll want to check with your city, county, or state resources to confirm what requirements you’ll need to meet in order to operate. That’s outside the scope of this article, so I will leave that part to you. So far as importing your items are concerned, you’ll need the following:

Vendors

If you do not have one already, locating a reputable vendor will be a difficult part of the process. One of the advantages of dealing with Indian importers is the widespread use of English, which should make things easier. Once you have found a vendor, consider placing a sample or small quantity order to get an idea of transit times, quality of the goods, actual pricing after shipping, insurance, etc.

Licensing

No license is required to import the items you have described from India (or most countries). You can file the import paperwork yourself at your local port office, but since the process can be complicated, I highly suggest you consult with a Customs broker who is licensed to transact business on your behalf.

Documentation

All import shipments coming into the United States must be accompanied by the following documentation:

• Commercial Invoice stating the country of origin of the goods, their value, the currency used, and the number of units being imported.
• Packing List – listing quantity and weight for the goods.
• Customs form 3461 – A formal paper request to Customs to allow the entry of your import. A licensed Customs broker will be able to provide one to you.
• Customs form 7501 – This form serves as a receipt for US Customs and yourself. It lists the items being imported, their value and the approximate duty you will be expected to pay. This will also be provided by a Customs broker.

Other considerations

Before importing, take some time to research or pay for a sit down visit with your import broker. Talk to them in detail about the type of goods you intend to import (including pictures or samples) and where they will be coming from. They will be able to provide an estimate for the amount of duty you will be responsible for, the classifications for your merchandise, and will be able to advise you on any special trade programs that might be applicable.

Please note: This article is intended for informational purposes only and is not specific legal advice. As an importer, it is your responsibility to meet all the legal requirements for importing goods.

Question

I plan to import on a commercial basis late this year a newly developed consumer product that uses Light Emitting Diodes and gentle vibration to revitalize facial skin. This is a consumer product similar to hair dryers and the Sonicare toothbrush that draws less than 500 W and is rechargeable with an electric charger. What will be the duty on these products?

Answer

It can be especially difficult to assign a Harmonized Tariff Number to manufactured goods, especially those based on an emerging technology because the Harmonized Tariff Schedule may not specifically account for the item being imported. As this is a manufactured or refined product, it will be found in the later chapters of the Tariff (as opposed to imports like wheat, steel, etc. which are found in earlier chapters). The more refined a good, the further back it will be listed in the tariff. This prevents us from classifying your LED skin-care tool as simply an article of plastic or metal.

My first thought with this was to look in section XVIII, chapter 90 of the tariff which covers medical items. After looking at your description again, you’ve listed it as a consumer item and not a medical tool which makes this chapter unsuitable. Chapter 90 covers medical devices like dentist drills, medical diagnostic tools and other items you might find in a doctor’s or veterinarian’s office.

From there, the next logical choice is Section XVI, chapter 85 which encompasses

Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles

The unit contains a light-emitting diode (which is specifically accounted for in the tariff), but it also vibrates and functions as a hand-held appliance. Based on your description, I believe the essential character of the item is less an LED, and more an appliance or piece of electrical machinery. With this assumption, I would classify this item under:

8509.80.0095 – which provides for electromechanical domestic appliances, with self-contained electric motor, and parts thereof, other appliances, other.

Assuming your import is coming from a country that maintains normal trade relations with the United States (China, India, Great Britain, etc.) this item carries 4.2% duty rate and is eligible for several reduced rate of free trade programs.

Other things to consider are the possible import restrictions placed on consumer cosmetic devices by the FDA as well as the possible implications of shipping hazardous materials in the form of rechargeable batteries.

Please note: This article is intended for informational purposes only and is not specific legal advice. As an importer, it is your responsibility to meet all the legal requirements for importing goods.

For general merchandise (those items not specifically regulated by another agency), importers may file Customs entries for their own account without applying for an import license and without the use of a Customs Broker. This is often the case when receiving a package via the US Mail from overseas, or travelers returning from business abroad.

Filing Customs paperwork for your personal business imports can be a way to reduce overhead, especially for importers brining in the same merchandise from the same vendors time after time. Please note that importers (and not their brokers or agents) are ultimately responsible for properly declaring their goods to Customs, filing the proper paperwork, and paying the appropriate amount of duty regardless of whether they import for their own account or utilize a Customs Broker. If you are an importer and are considering filing Customs entries for your own account, take the time to research your commodity, and browse this site for articles on classifying with the USHTS and properly determining the value of your goods. Also be aware that in many cases Customs port offices are not accustomed to dealing with individuals since the majority of entries are filed by brokerage houses through the electronic ABI (Automated Broker Interface) system.

You do not need a license to act as an importer. However, some items require a license or permit from various government agencies in order to be imported. For more complete information, please see our publication “Importing Into the U.S.” The chapter on “Special Requirements” provides very complete information. (Some common items that may require licenses or permits are food products ordered from a commercial vendor, plant, animal and dairy products, prescription medications, trademarked articles such as name-brand shoes, handbags, luggage, golf clubs, toys, etc. and copyrighted material such as CDs, DVDs and tapes)

Customs paperwork does require an “importer number” as a means of identifying who the final recipient of the goods is. If you have a business tax number with the IRS, this number should be used as the importer number. If you do not have a business tax number, you may use your Social Security number. If you do not wish to give your SSN to a shipper, and your importation is for personal use, is under $2000, and is being cleared by a Customs Broker (very common for goods shipped by courier services) please see our information about using a third party’s Importer Number by typing Social Security Number in the word search field above. If you have neither a business tax number or a social security number, and you are a non-resident of the U.S., you may contact the port where your goods will enter the country and ask them to assign an importer number to you.

A license is required to act as a Customs broker, which is someone who clears goods through Customs on behalf of importers who do not want to handle the various technicalities that are involved in importing themselves.

For more information about the process of clearing goods through customs, please see our series “U.S. Import Requirements”.

If you have ordered something from an overseas seller over the Internet for your own personal use, you should also see our information on Internet Purchases.

Textiles products have the benefit of inexpensive overseas production sources as well as a large US market demand and can be a highly profitable and popular import commodity. Due to the over-saturation of overseas textile manufacturers and the US socio-political agenda, however, the United States has developed a complicated system designed to regulate the importation of textiles. If you are looking to import textiles into the United States, this guide is for you. Webster’s Dictionary defines Textile as: Pertaining to weaving or to woven fabrics; as, textile arts; woven, capable of being woven; formed by weaving; as, textile fabrics.”

For import purposes, this definition extends to a wide variety of clothing, bedding, and fabric related products. Articles of nightwear, hosiery, sportswear, and apparel are all considered textile products.

Where to buy:

Wholesale: Nightwear, Hosiery, Sportswear, and Apparel

China and India currently dominate the international market for textile imports.

Classification and Duty Rates

Textiles and textile products are listed in their own section in the Harmonized Tariff Schedule of the United States found (as of 10/18/04) here:

SECTION XI: TEXTILE AND TEXTILE ARTICLES.

The HTS is the source used by the United States Government and US Customs to determine duty rates.

When classifying textiles for import, it is important to note the following:

Many kinds of goods imported for commercial use may be subject to a quota limit. It is the classification number of the article as identified in the Harmonized Tariff Schedule of the United States and the country of origin that determine whether or not an item is subject to quota requirements. In some cases, the quota is absolute, meaning that once the quota is filled – because the quota has reached its limit for that particular period of time – no additional quantities of that item may be imported until the next open period. Such merchandise must be warehoused or exported. Other quotas are tariff-related, which means that a certain quantity of goods may enter at a low rate of duty, but once that threshold is reached – during a specified period of time – a higher duty rate will be assessed for any additional quantities of that particular imported good. Unlimited quantities of some merchandise subject to tariff-rate quota may, however, enter at over the quota rates.

If you are importing goods for commercial use or resale, it’s a good idea to contact your local port of entry for more specific information.

The Quota program is generally applied only to commercial importations. While the importation of many goods imported under “personal use” quantities are not affected by quota restrictions, there is one exception; made-to-measure suits made in Hong Kong, which are restricted for both personal and commercial use.

The following provides information concerning the importation of a passenger car, truck, trailer, motorcycle, moped, bus, or MPV built to comply with the standards of a country other than the U.S. or Canada.� Importers of motor vehicles must file form HS-7 (available at ports of entry) at the time a vehicle is imported to declare whether the vehicle complies with DOT requirements. As a general rule, a motor vehicle less than 25 years old must comply with all applicable Federal motor vehicle safety standards (FMVSS) to be imported permanently. Vehicles manufactured to meet the FMVSS will have a certification label affixed by the original manufacturer in the area of the driver�s door. To make importation easier, when purchasing a vehicle certified to the U.S. standards abroad, a buyer should have the sales contract verify that the label is attached and present this document at time of importation.

A vehicle without this certification label must be imported as a nonconforming vehicle. In this case, the importer must contract with a Registered Importer (RI) and post a DOT bond for one and a half times the vehicle�s dutiable value. This bond is in addition to the normal Customs entry bond. Copies of the DOT bond and the contract with an RI must be attached to the HS-7 form.
Under the contract, the RI will modify the vehicle to conform to all applicable FMVSS and so certify the vehicle. Before an RI can modify a vehicle, NHTSA must have determined that the vehicle is capable of being modified to comply with the FMVSS. If no determination has been made, the RI must petition NHTSA to determine whether the vehicle is capable of being modified to comply with the FMVSS. If the petitioned vehicle is not substantially similar to a vehicle of the same model year certified for sale in the U.S., this process becomes very complex and costly. A list of vehicles previously determined eligible for importation can be found on the NHTSA web site at http://www.nhtsa.dot.gov/cars/rules/import.
Since the cost of modifying a nonconforming vehicle, or the time required to bring it into conformance, may affect the decision to purchase a vehicle abroad, we strongly recommend discussing these aspects with an RI before buying and shipping a vehicle to the U.S.
For federal regulations concerning vehicle emissions contact the Environmental Protection Agency, Certification and Compliance Division � Imports Program, 2000 Traverwood, Ann Arbor, MI 48105, (734) 214-4100, or http://www.epa.gov/otaq/imports/.
For information regarding registration or operation of a properly imported vehicle in a specific State, we advise you to contact the Department of Motor Vehicles or other appropriate agency in that State since the requirements vary by State.

Save on import brokerage fees by downloading the US Harmonized Tariff Schedule and determining your product’s classification before you import.

The Harmonized Tariff Schedule is broken into two major parts: notes and classification.

The notes portion of the HTS comprises approximately one fourth to one fifth of the Tariff Schedule. It contains rules of classification, details on region-specific trade programs (NAFTA and the CBERA), recognized countries and abbreviations, and a list of recent changes to name a few. For purposes of this article we will focus primarily on the rules of classifications.

Reading the HTS: Chapters

The Harmonized Tariff Schedule is broken into 22 different sections which are further divided into chapters. A good rule to remember is that the tariff is categorized with the most highly processed and refined goods last. That means that raw products such as live animals, lumber, and agricultural products will be found near the front of the tariff while electronics, works of art, medical devices, etc. will be found at the back.

Reading the HTS: Notes

Each chapter of the HTS contains notes on classifying products within that chapter. It is very important to thoroughly review these chapter notes before continuing with the classification process. Often times, these notes will list specific articles that can or can not be classified within that chapter. The notes can contain lists of acceptable definitions, clarifications to chapter headings, and other important information

Reading the HTS: Headings and Subheadings

A Harmonized Tariff Classification is a 10 digit number used to identify a specific product. Here’s a sample from Chapter 82 of the HTS (TOOLS, IMPLEMENTS, CUTLERY, SPOONS AND FORKS, OF BASE METAL; PARTS THEREOF OF BASE METAL)

8201.10.00.00 is a handtool of a kind used in agriculture, horticulture or forestry; and more specifically and spade or shovel.

The first two digits (82) of this classification are a reference to the appropriate chapter. The first four digits combined (8201) comprise the article’s heading within that chapter, while the last six digits (10.00.00) break that heading down into subheadings.

In our example, this product is broken down in the following manner:

Chapter 82:TOOLS, IMPLEMENTS, CUTLERY, SPOONS AND FORKS, OF BASE METAL; PARTS THEREOF OF BASE METAL

Heading 8201: Handtools of the following kinds and base metal parts thereof: spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry

Subheading 8201.10.00.00: Spades and shovels, and parts thereof

Reading the HTS: Unit of Quantity

This is the US Customs acceptable measure of quantity for a product. This measurement must be reflected on your commercial invoice.

Reading the HTS: Rates of Duty.

The Rates of Duty Column determines the amount of duty you will have to pay on an imported product. Typically these rates of duty are expressed in a quantity/cost rate (e.g. $0.04/kg) or as a percentage of the value of the good (e.g. 2.5% of the value).

Notice that the Rate of Duty Column is divided into three interior columns. These columns are interpreted as follows:

General (aka Column 1): The typical rate of duty from the majority of the world’s countries.
Special: Special duty rates assigned to specific countries or import scenarios.
Column 2: The special rate of duty assigned to trade restricted countries. Cuba, North Korea, etc.

Save on import brokerage fees by downloading the US Harmonized Tariff Schedule and determining your product’s classification before you import.

General Rules of Interpretation

The General Rules of Interpretation (GRI’s) outline the method used to determine a product’s classification. They also address special scenarios wherein a final classification may be difficult to determine. The General Rules of Interpretation below have been taken verbatim from the HTS (current as of 11/1/04). Classification of goods in the tariff schedule shall be governed by the following principles:

1. The table of contents, alphabetical index, and titles of sections, chapters and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to the following provisions:

2. (a) Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled. (b) Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of rule 3.

3. When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows: (a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. (c) When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.

4. Goods which cannot be classified in accordance with the above rules shall be classified under the heading appropriate to the goods to which they are most akin.

5. In addition to the foregoing provisions, the following rules shall apply in respect of the goods referred to therein: (a) Camera cases, musical instrument cases, gun cases, drawing instrument cases, necklace cases and similar containers, specially shaped or fitted to contain a specific article or set of articles, suitable for long-term use and entered with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith. This rule does not, however, apply to containers which give the whole its essential character; (b) Subject to the provisions of rule 5(a) above, packing materials and packing containers entered with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use.

6. For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.

Final Note

This article is intended to provide a general understanding of the structure of the Harmonized Tariff Schedule and the method used to determine a product’s classification. By nature of an introductory article, it does not cover special and extenuating circumstances that often arise when determining a product’s final classification. The authors of this article recommend that you consult with a licensed Customs broker or member of the US Customs Service should there be any question as to the classification of your product. As the importer of record for your product, it is your responsibility to ensure that the classification presented to Customs for the import of your shipment is the most accurate and legitimate classification. It is important to understand the process of classifying your product because as the importer of record you can be held ultimately responsible for mistakes made in classification