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 E-Merchants Trade Council, Inc.

Simplifying Global E-commerce 

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MEMBERSHIP

Why should I join?

EMTC connects the dots to e-commerce cross-border sales in simple business terms. 

Cross border sales potentially increase your conversion rates from browser to buyer.

Our Help Desk  provides easy and fast access to the seasoned expertise you need to reduce friction in your sales and shipping . 

We focus on simplifying cross border sales through cost effective automation solutions. 

We support legislation, in any country globally, that makes e-commerce simple.     

We are a grass-roots community that advocates for simplification of trade, tax and transportation regulations.  

What does EMTC do?

EMTC promotes and supports e-commerce merchants through educational webinars and conferences, and a Help Desk network of seasoned trade professionals to provide guidance to address and eliminate cross border challenges with trade, tax and transportation.  By connecting these dots, we simplify your process to save you time and money. 

Who can be a member?

Membership in EMTC is open to anyone who participates in E-commerce as a seller, marketer, employee of an E-Merchant or service provider.  Our membership form provides the member levels available.  "Join Us" describes our Membership community.

What are the requirements to join?

Membership is open to anyone who is currently active in an e-commerce role as an E-Merchant, employee of a company that has an e-commerce presence or who provides service to the e-commerce community.  To remain an active member, dues must be paid within 30 days of the invoice date.

What are the dues?

Dues depend on your membership level.  Our membership form found on the Join Us page  will help you determine the right level for you.   

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TRADE AND E-COMMERCE

What is trade?

Trade is the transfer of goods or services from one person in one country  to another person in a different country for an agreed upon amount of  money.  This is known as the transaction value or price paid or payable.   When the buyer and seller are in different countries, the trade laws of both countries govern the transaction.

What are the benefits of global trade?

When an E-merchant exports its products to foreign countries, it has a bigger potential market than the home country market. Foreign market demand for the product may be higher due to supply available and demand from consumers. Consequently, the E-merchant can produce more, sell more, and increase profits.  Some products may be more readily available, or lower cost in other countries.  An E-Merchant may choose to import such products or components to reduce COGS (cost of goods sold).

Is cross-border trade common in E-commerce?

In 2022, cross border trade is projected to be 22% of all e-commerce shipments of physical products.  The value of these shipments will reach approximately $3.53 Trillion USD.   Additional information is available in the Industry News block and statistics on this website.  

What is a Section 321?

Section 321(a)(2)(C) of the Tariff Act of 1930, as amended, authorizes CBP to provide an exemption from duty and tax for qualified imports of not more than $800 fair retail value. This exemption is known as a de minimis entry.   This does not exempt the entry (package shipment) from other government regulations.

Do I have to pay any duty if I buy something on the Internet?

The Internet has made it easy to find and purchase items from almost anywhere in the world.  When goods move from any foreign country seller to another foreign country buyer, they are being EXPORTED from the origin country and IMPORTED into the destination country. There are specific rules and regulations that govern the act of exporting or importing - and they can be extremely complex, confusing and costly if not done properly.  For specific questions ask our Operations Advisory Council.

If my Internet purchase came from another country is my seller responsible to get it to me?

When you buy goods from foreign sources, you become the importer. And it is the importer – in this case, YOU – who is responsible for assuring that the goods comply with a variety of  state, provincial and federal government import regulations. Importing goods that are unsafe, that fail to meet health code requirements, or that violate quota restrictions could end up costing you quite a bit of money in fines and penalties. At the very least, such goods would be detained, and possibly destroyed, by CBP.  The notice for a detained shipment is called WRO -withhold release order.

If my E-commerce Customer is not in the US will they pay me in US dollars?

When you sell to a customer located in another country you should agree in advance and clearly specify on the offer, contract and/or invoice the currency for the payment.  This will affect the duties paid and your revenue.   Your bank and/or credit card processor may charge a fee if the currency of the payment is not the local, in-country currency.  Exchange rates will affect the final amount you receive. 

If my E-commerce vendor is not in the US can I pay them in US dollars?

When you buy from a vendor located in another country you should agree in advance on the currency to be used  and clearly specify on the purchase order or agreement and  invoice the currency for the payment.  Lack of clarity will affect the duties that you will pay.  If the broker sees “10,000” and enters it as US dollars you will pay duty on $10,000  but in reality the value is under $100 USD due to the foreign exchange rate.    For 5% duty this is the difference between $5.00 and $500.00.  Moreover, a $100 shipment will be eligible for de minimus so no duty would be owed.  For specific questions about invoices ask our Operations Advisory Council.

What do I do if my shipment is "stuck in Customs"?

Shipments that are held by a Customs agent generally have unclear or missing information.  It is best to work with your customs broker or the courier service help desk to determine what information is needed by the Customs agent to clear your shipment for delivery.  Planning your shipment in advance is the best prevention. Ask your shipping agent if there are any special requirements or limitations for shipping your goods to a specific customer destination.  Requirements may be different in different countries.  For specific questions ask our Country Advisory Council.

If I ship a parcel to Puerto Rico is that an export?

Packages shipped from the U.S. to Puerto Rico are considered domestic shipments and do not need to go through customs.   Shipments do require a commercial invoice and may need to provide Electronic Export Information. The Census Bureau’s Economic Directorate collects and processes data on shipments between the United States and Puerto Rico.  Puerto Rico charges a tax upon arrival.

If I ship a package to Canada is that an export?

Yes it is an export from the United States.  Shipments to Canada are subject to the Canada Border Services Agency (CBSA) review and the Canadian import laws. While they are contiguous, they are separate countries with their own trade laws and regulations. 

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IMPORT & EXPORT QUESTIONS

What are trade barriers? 

Trade barriers are obstacles for trade. These are measures that make trade more difficult or less attractive, and thus discourage trade.  Barriers may include high duty rates, quota limits or safety certification.

What are free trade agreements?

Free trade agreements are written agreements between countries or economic unions, aiming to reduce duties and/or trade barriers as a means to open up each other’s market for companies from the other market.   FTAs are seen as a means to stimulate exports, and thereby to stimulate economic development For specific questions on trade agreements ask our Country Advisory Council.

What is global trade compliance? 

Trade compliance is the process of ensuring adherence to all the laws, rules, regulations and procedures governing all trade between two or more countries. Trade regulations are determined by each country, so compliance requires the importer and exporter to address requirements of multiple countries.  The responsibilities are shared to ensure the product that is exported can be imported at the destination.  For specific question ask our Country Advisory Council.

What is the role of Customs in trade? 

Customs is the primary organization tasked with governing trade compliance.   Customs agents determine admissibility of your parcel into the country.  They have the right to request additional information about the parcel or shipment.  Customs in the U.S. enforces regulations for  40 other agencies when a product is imported.   In other countries Customs has responsibility for taxes and quarantine of goods.

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TRADE OPERATIONS QUESTIONS

 

What is an Authorized Economic Operator(AEO)?

The term AEO is used outside the U.S. for a type of public-private sector partnership program covering Customs simplification, security of goods, and safety.  An AEO participant must demonstrate compliance with Customs legislation, taxation laws, have appropriate safety and security measures for products and facilities, maintain appropriate records and be financially solvent.

What are INCOTERMS?

INCOTERMS (International Commercial Terms) are an internationally recognised set of trade terms developed by the International Chamber of Commerce (ICC). The terms define the responsibilities, risk and financial  liabilities between a buyer and a seller. They cover who is responsible for paying freight costs, insuring goods and paying any import/export duties.  INCOTERMS always include a specific place such as city and country after the three letter term.   INCOTERMS do not assign passage of title to goods.  This must be specifically stated in the contract or on the invoice.  If you have specific questions, ask our Operations Advisory Council. 

What INCOTERM is best?

INCOTERMS cover a spectrum of risk and responsibility from full obligations for the buyer (Ex-Works) to full obligations for the seller (DDP).  In between there are combinations of where these obligations pass in the supply chain from a seller to a buyer.  The terms for risk and financial  liability should be negotiated between the seller and the buyer.  INCOTERMS should always include a specific place (city, country) after the three letter term.

Should I sell products “Ex-Works”?

When using" EX Works" all of the costs and risks of shipping the goods are for the buyer's account.  For the buyer it can be a good term to get a clear picture of all of their shipping costs, which can help calculate more accurate landed costs.   There are issues when using "EX Works".   Risk passes when the goods are made available for collection at the seller's location as named , EXWORKS (city), (country).  This means the buyer is responsible for loading the goods, but many companies who use this term as the seller will actually load the goods onto the transport vehicle. 

The other issue is the customs declaration for export, where the buyer has responsibility for this process, yet a seller who is exporting from the UK, would not be charging VAT.  Therefore, it is important that the seller can get proof of export for HMRC audit purposes, which can be difficult in some cases when using the EX Works term. For an exporter (buyer) it may be better to use other terms, which cover the loading and export declaration process.

Will “DDP" simplify the purchase for my customer?

Delivered Duty Paid (DDP) is a term where the seller is responsible for the export formalities at origin and the  import duties and taxes on the shipment in the country of import. If a company is aware that these charges would be for their account and  have accounted for them for profitability, then may be the company would opt to use this term.  The seller must be able to be an importer at the destination country.

In the majority of B2B shipments, DDP can result in unexpected charges for the seller that would impact on profitability, due to a lot of “unknown” costs that could be applied to the seller's account.

Another issue is that some countries require the buyer to be registered as an importer in the country of import, which restricts the use of this term.  The buyer is responsible for the regulatory requirements related to the imported item.  Most sellers are not registered in another country for value added tax payments (VAT/GST). The exporter (seller) may not have, or be eligible to obtain  an import identification number for that specific country.  

What are Rules of Origin?

Rules of origin are used to determine the origin of a product for purposes of international trade. For example, the EU and Canada have a "preferential trade agreement", so for exporters they need to prove their products being shipped meet the rules of origin so that the importer can benefit from reduced or zero import duties.  Non-preferential rules of origin determine the country of origin for MFN duty status in the Harmonized Tariff.   Preferential and Non-Preferential rules are generally different.   

What is the Customs Value?

The customs value is usually the price actually paid or payable computed from the point of exportation, without costs of international shipping. In certain circumstances, adjustments must be made or other methods of valuation must be used. CBP regulations provide information on how to compute customs value, and rulings can be requested in advance if questions exist.  For specific questions  ask our Operations Advisory Council.

Does international trade require a sales transaction? 

In most cases trade follows a sale of products, where the buyer and seller are located in two separate countries. 

If my vendor sends me a sample" free of charge" do I pay any duty on it?

Free of charge (FOC) goods must still meet all regulatory requirements for importation into the country.  Duty will be charged based on the value in the marketplace.  If the vendor sends you samples of ceramic tile then the value is what you would normally pay for them, even if you do not remit any funds for those specific samples.  This must be reflected on the invoice with the shipment.   Duty is based upon the tariff number, market value  and origin of the ceramic tile. 

How do I find an HTS tariff number? 

Some products are named in the Harmonized Tariff Schedule and can be found by searching for the name. Be aware, however, that finding a name of a product does not guarantee a correct classification. Consider the classification of a kitchen paring knife with a ceramic blade. Either a word search or casual browsing through the Tariff Schedule might lead to heading 8211 ("Knives with cutting blades, serrated or not, . . . ."). However, Chapter 82 Note 1 excludes articles with a blade of ceramic from Chapter 82. The proper classification is in Chapter 69 as an article of ceramics.  It is best to seek help from a Classification Expert.

Is the tariff number the same for the exporter-seller and the importer-buyer?

The Harmonized Tariff Schedule is generally the same to the first six digits.  Countries may interpret the descriptions differently, particularly for more complex objects. For example, a plastic receptacle for medical waste in a doctor’s office is classified as plastic lab ware (3926) in the U.S. but as a plastic garbage can (3923) in Canada.  This is due to interpretation by the different customs agencies.

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