Since the United States produces such equipment already, you may be wondering why one would want to get it from abroad. Some of the key reasons are as follows.
While there is a lot of machinery produced in the United States, there may be some equipment that’s only created abroad. Some resources may be difficult to obtain on US soil and/or manufacturing costs may be cheaper in other countries. Additionally, the US has trading agreements with various nations, so importing heavy equipment from them is easy.
Our country’s imports amount to more than $2 billion each year, and for good reason. Regardless of how large a country is, in order for its industry to grow, machines and resources will need to be brought in.
The following countries trade most often with the US, so importing heavy equipment from them will be easier.
- Mexico. Each year, almost $300 million worth of products are imported from Mexico. Besides cars and computers, heavy equipment is imported as well.
- Japan. In general, cars are imported from this country. However, if you can find a heavy equipment supplier, it may be worth a shot.
- Germany. Lots of machinery, pharmaceuticals, and cars are imported from here.
- UK. Usually, imports consist of machinery and automobiles.
- France. Goods amounting to $48 million come annually from France. The most common items are beverages, machinery, and equipment needed for manufacturing aircrafts.
- India. Gemstones, oil, and pharmaceuticals worth $46 million are imported from India each year. However, heavy equipment manufacturers may be harder to find.
- Italy. Finally, around $45 million are spent on imports from Italy each year. Beverages, especially wine, pharmaceuticals, and machines including heavy equipment are the main products sent into the US.
Because there are already established and ongoing business relationships with the above countries, importing heavy machinery from them may be easier. However, this shouldn’t discourage you from working with a supplier from somewhere else. EU countries all have similar export procedures, and there should be ways to bring over equipment from most other countries as well.
Dealing with demand
Depending on consumer interest, season, and the heavy equipment you’re looking for, the demand for said product may be higher or lower. In cases where the demand is huge, you may have to wait for quite some time until it’s available. However, through international trade, this doesn’t have to be a problem for you.
If the demand is too high in the US, you can buy it from another country. If the demand is too low, and the machinery is no longer being manufactured locally, you can again obtain it from somewhere else.
Buying factors you should consider
One of the reasons the US opts to buy certain equipment from other nations is because it’s cheaper than making it locally. Even with the added cost of transport, it’s still the superior deal. A few things to consider when making an international purchase are as follows.
Always check the equipment’s model and brand. There are unique purposes, features, and strengths associated with each brand. The following criteria can be used to check how your chosen equipment meets your construction or business needs:
- Maintenance requirements,
- Parts availability,
- Technological requirements,
- General specifications like equipment capacities, weight, or engine size,
- Its features.
Afterwards, the equipment’s cost plays a big role. You should check the indirect costs as well. These may be energy and time investment, travel expenses, etc. As for direct costs, these can be shipping and transport, inspection costs, carriage costs, bank charges, clearance fees and import duties, etc.
Next, one must find a good manufacturer or dealer. You can find them online regardless of their location, but you’ll need to do a background check, verify reviews, their expertise, business history, reputation, etc.
To complete the transaction, you can use a number of payment methods, such as cash, card payment, letter of credit, bank transfer, etc. However, regardless of your decision, you should make sure there’s a clear paper trail which you can use to prove your transactions.
Furthermore, the seller’s conditions and terms regarding the payment should be properly understood. Before committing to anything, you should know their down-payment commitment clause. Or, in case you cancel your order, you may want to check what happens to your outlaid payment.
The final factors you should consider are import regulations. We’ll discuss them further in depth below.
Laws and regulations on importing heavy equipment
To ship heavy equipment into the country, the government’s regulations must be met. EPA laws will have to be followed, and a 3520-21 EPA form will need to be completed.
Furthermore, a customs bond will also need to be prepared. You can get helped from a customs broker to get your equipment past the border and to assist with documentation.
Four main documents will be important for the import process. The first of these is the arrival notice. After the carrier or shipping agent sets it up, it will be passed towards the recipient or consignee.
The purpose of the arrival notice is to inform the consignee that the heavy equipment has arrived. The form may include various information, like the number of cargo units, what they include, and the pickup charges.
The second document all import projects require is the lading bill. The carrier or shipper will send it to the items’ owner, captain, or agent. The purpose of the lading bill is to act as a written promise. It contains information on where the equipment will shipped, how it will be moved, and when. It also contains the conditions for the transport.
The freight forwarder or shipper will prepare and send a packing list. The invoice’s information will be included on it with some additions as well. Before shipping the goods, a CBP officer may review the invoice and packing list.
Finally, the 4th document your import will require is the commercial invoice. For it to be valid, the following information will be needed:
- Business address,
- Shipping address,
- Origin country,
- The item’s value,
- The items,
- The recipient’s business or company location and name,
- The company’s location and name.
To import heavy equipment, a customs bond will be needed. They come in 2 forms: single entry and continuous bonds. Therefore, it’s necessary to know if you’ll be importing equipment regularly or if it’s a one time deal. Customs bonds act similar to insurance policies in that they ensure fees such as the duty tax will get paid.
- If you’re taking equipment through an entry port and wish to minimize risks and costs, then a single entry bond will be all you need. However, you will need a new one every time you organize an import.
- If you’re importing more than 4 times every year, then it may be better to get a continuous bond. Heavy equipment being high value and high risk will benefit the most from a continuous bond. With it, you can import as much as you want within that year. It will also give you access to any US entry point. As for its cost, this may vary, so it’s best to look it up through your shipper.
Customs bonds are obtained through customs clearance.
The entry process
When your heavy equipment arrives at the US border, the record importer (consignee, purchaser, customs broker, or owner) will file the entry paperwork at the entry port to the port’s director. For your imported equipment to be considered as legally entered into the US, it must arrive at the entry port, receive authorization from the CBP, and you or your representative will need to pay the estimated duties. The item’s examination and subsequent release must be organized by the importer of record.
As an important side note, importers should not only contact the CBP, but also any other agency relevant to the import. For example, your heavy equipment may be regulated by the EPA and will need to comply with their standards.
Heavy equipment may enter the country for use, placed in the port’s warehouse, or moved to another entry port and entered into the country there through similar conditions. Moving the in-bond equipment to another port can be done by the customs broker or consignee.
However, its transportation will increase your expenses. In some cases, items can be released using the entry port in your vicinity even if their arrival was made at another US port. You’ll need to file the documents and duties at the entry port’s CBP before the equipment arrives.
Entry right evidence
Heavy equipment may be entered into the country only by its buyer, owner, or by a customs broker. After it’s consigned, the lading bill will act as proof of the item’s entry right.
Usually, a firm or a person the carrier certifies will bring the equipment to the entry port. For customs purposes, this entity will be known as the items’ owner.
To clear customs, the carrier will issue a paper called the carrier’s certificate. In some cases, you may be able to enter the equipment using a shipping receipt or a duplicate lading bill. If a carrier is not the one importing the goods, the right to make entry will be given to whoever is in possession of the equipment when it arrives.
After the equipment gets to the entry port, the broker has 15 days to file the entry documents at the port director’s specified location. The needed paperwork is the following:
- A 3461 CBP form (special permit and application for immediate delivery), 7533 CBP form (entry manifest), or other merchandise release forms the port director requires.
- Pro forma or commercial invoice.
- Right to make entry evidence.
- Any other paperwork required for the items’ entry.
In order for the CBP to release the heavy equipment from their custody, you’ll have to file an entry summary and also deposit the estimated duties at the entry port in a maximum of 10 days after your items entered the country.
Along with the entry, the evidence of a bond covering taxes, charges, and duties must be posted. You can secure a bond at a United States surety company. You can post it as US currency or obligations towards the US government. If a customs broker is sent to ensure the equipment’s entry, he may allow for a bond to be used to ensure the necessary coverage.
After presenting the entry, the CBP may examine the shipment or waive the examination. Afterwards, the shipment will be released provided no regulatory or legal violations took place.
The shipper will need to file the entry summary paperwork and deposit the estimated duties within 10 days since the merchandise entered at the customhouse. The paperwork’s summary will contain the following:
- A 7501 CBP form (entry summary).
- The entry package’s return to the authorized agent, broker, or importer after the merchandise’s release is approved.
- Other necessary documents and invoices needed to collect statistics, assess duties, and check if the import’s requirements were properly handled. Using ABI features, the necessary documentation may be eliminated or reduced.
You can use an alternate procedure in order to release the shipment immediately by obtaining an immediate delivery special permit before the equipment arrives. This is done by completing a 3461 CBP form.
If the carrier is an Automated Manifest System participant, he may receive more release authorizations 5 days prior to arriving in the US or upon leaving the other country. After the application’s approval, the expeditious release of the shipment will follow.
Using a proper form, the broker will need to file an entry summary, electronically or on paper, as well as deposit the estimated duties within 10 days. Only the following merchandise types may be subject to immediate delivery release:
- Items from Mexico or Canada when the correct bond is used and the port director’s approval was obtained.
- Shipments organized by an officer or agency belonging to the United States government.
- In some situations, merchandise using a tariff rate quota. Absolute quota articles may also apply, but they’ll need formal entry.
- On rare occasions, warehouse items that were just released.
- Items that were authorized by the headquarters of the CBP for the purpose of immediate delivery.
If you want to postpone your heavy equipment’s release, you can put it in a warehouse with a CBP bond on it. The warehouse may be used for a maximum of 5 years for this purpose. You can re-export the equipment during this time without having to pay duty. You can also withdraw the equipment after paying the duty tax applicable on the day you make the withdrawal. No duty will be paid if your items are destroyed while the CBP watches over them.
While your heavy equipment is in the warehouse, it can be manipulated under the supervision of the CBP to clean it or change its condition through processes other than manufacturing. Within the period when the item is in the warehouse and after it was manipulated, you can export it without paying duty. You can also withdraw it after paying the appropriate duty rate.
If at the destination or entry port, there was no entry filed for your heavy equipment within 15 days, it may be put in a warehouse at your expense and risk. If you do not enter the machinery within 6 months, it may be destroyed or sold through a public auction.
The money resulting from the auction will be used to pay for storage charges, fees, duties, and various other taxes. You can file a claim for the extra earning at the port director who ordered the equipment’s sale. You’ll have to file the claim less than 10 days after the heavy equipment was sold, and you’ll have to provide the original lading bill as evidence.
You can use a certified or photostatic copy of the lading bill if just a piece of the shipment was sold. Instead of the port director, it’s the carrier’s duty to inform the warehouse of items that weren’t entered.
After notifying it, the manager or operator of the bonded warehouse will organize the transport of the equipment to the carrier’s premises to be stored at the expense and risk of the consignee. If there are revenue taxes associated with the equipment, but its sale will not be enough to cover said taxes, the item may be destroyed.
In bond transportation
Some items brought into the US don’t make their entrance into the country at the port where they had physically arrived. For various reasons, some importers choose to make the equipment’s entry at another location which will require its transport towards it.
In this case, a bond will be placed on the heavy equipment to protect the US’ revenue interests. The process is handled through a 7512 CBP Form meant for the transport manifest and entry of items subject to permit and inspection by the CBP. A carrier willing to transport bonded equipment will handle the transport itself through the normal process.
Right to enter the country
If a commercial carrier brings your heavy equipment into the country, then the purchaser, owner, a customs broker, consignee, or an authorized employee must handle the entrance. You cannot get a CBP officer to handle the import for you, though you can obtain some assistance and advice from them.
The only ones authorized to be importer agents according to US tariff laws are customs brokers. They’re CBP licensed firms or individuals that organize and send the needed entries towards customs. They make sure that duties are paid, handle the equipment’s release from the custody of the CBP, and act according to their customer’s needs. Depending on the broker and on what services you ask of him, the fee will differ.
For your heavy equipment to enter the country, an evidence form giving it entry right is needed. The broker will use a power of attorney to make the entry. It’s provided by the firm or individual on behalf of whom the broker operates. Usually, an employee’s entry authority is best obtained through a power of attorney.
Entry handled by others
Nonresident partnerships or residents, as well as foreign corporations can also handle the equipment’s entry using the exporter, officer, or partnership member’s representative. A United States agent is also an option.
You must incorporate in the US a CBP bond’s surety if it’s provided by a nonresident organization or individual. Also, if you enter merchandise in the mane of a foreign corporation, it will need an agent that is resident of the state containing the entry port. The agent must have the proper authorization to process the equipment on the corporation’s behalf.
With the help of a power of attorney, a licensed broker can also handle the entry for the exporter. If a nonresident organization or individual makes a declaration requested by the broker, it needs the support of a surety bond in cases where there are duties to be paid or the fee is increased.
You can use a declaration from the owner even if it was made in another country. However, it must be made at a notary and have its seal. You can find a notary public in any US embassy in the world as well as in many consulates.
Using a power of attorney
Foreign corporations, partnerships, or nonresidents may give a corporation officer, partner, customs broker, or employee a power of attorney in order to handle the shipment within the US on the employer’s behalf. The person using the power of attorney needs to be a US citizen with the authorization to handle the shipment on the organization or person’s behalf.
Once issued, the power of attorney cannot be revoked when it comes to the transaction undertaken with customs. You can use a CBP form or a similar document to issue a power of attorney.
You can delete any rights you haven’t authorized your representative for from the document or form. If a foreign corporation issues a power of attorney, the following paperwork will be needed to support it.
- A certificate proving the corporation’s legal existence from the country’s officer. In situations where the incorporation fact is common knowledge, this may not be needed.
- Copies of the articles or charter of incorporation showing its governing body and business.
- Copies of the paperwork through which the individual that signed the power of attorney has the power to issue it. They can be a resolution copy, incorporation articles, charter provision, etc.
A foreign corporation, partnership, or nonresident individual can authorize the firms and persons holding their power of attorney to create and give other power of attorney to US qualified residents. These citizens will now have the right to accept the process service on the organization or individual’s behalf.
A partnership’s power of attorney must not be longer than 2 years from the execution date. It must also contain the names of every partnership member. Any partnership member can use the power of attorney in order to handle customs business on the partnership’s behalf.
If through a membership change, another firm is created, the power of attorney of the previous firm will stop being valid for customs purposes. Another power of attorney will need to be issued by the second firm for this purpose.
Examining the heavy equipment and documents
Examining the documents and goods being brought into the country is necessary for the following reasons:
- To verify their value in order to determine the correct duty tax.
- To check if the items need their origin country’s mark or other special labels or markings.
- To check if there are prohibited items present.
- To check if the items were invoiced correctly.
- To check if there’s a shortage of items compared to the invoice or an excess of it.
- To check for illegal narcotics.
Many times, cargo shipments are utilized by smugglers to bring narcotics into the US. They’re placed inside legitimate containers or shipments with the plan to retrieve them after the border was crossed. Since there are numerous ways through which smugglers hide narcotics, customs officers will examine every nook and cranny, including the heavy equipment itself.
Deterioration or damage
If a CBP officer determines your item to have no commercial value when it comes into the US due to deterioration or damage, it will earn non-importation status. No duty will be charged for it.
If you’re importing multiple heavy equipments and only some of them are damaged, the duty allowance will be given only if the importer separates the damaged ones from the rest under the CBP’s supervision. It’s not possible to obtain a duty reduction allowance for loss or damage due to discoloration or rust if your item is made out of steel or iron.
It’s defined as a responsibility shared by the import community and the CBP through which the trade’s requirements are communicated by the CBP and the businesses and people that must respect these requirements will conduct their activities according to existing regulations and laws. A very important part of this compliance is the expectation that the importer will exercise care during his importing projects.
Both parties benefit from informed compliance. The CBP needs to expend fewer resources on entry reviews and examinations if an importer’s cargo is dependably compliant. Also, compliant importers have their imports examined and reviewed much less often.
To help those interested in importation, a lot of information is published on the subject by the CBP. They issue informed compliance publications and rulings on many technical processes and subjects. These papers are easily accessible online.
All importers are responsible for showing reasonable care. Though the connotation is simple, the circumstances and facts around imports can differ greatly. Therefore, those involved in imports and the CBP are unable to create a care checklist that can cover all transactions related to imports.
However, when conducting a transaction with customs, the following general checklist should be consulted:
- In some cases, you may not have an expert, such as a customs broker, lawyer, customs consultant, or accountant helping you with meeting CBP requirement. In such situations, you’ll need access to CBP regulations, CBP decisions and bulletin, and to the US harmonized tariff schedule. You’ll need online access to the CBP or to information provided through other means, so you can create proper procedures that comply with CBP regulations and laws.
- A knowledgeable and responsible individual must review the CBP documentation before using it to make sure it’s accurate and complete. If someone outside of your company has prepared the documentation, then you may need a way to ensure you get copies of the papers sent to the CBP. They’ll need to be reviewed to ensure they’re accurate, and the CBP must be informed of any necessary corrections.
- When using an expert to ensure your import meets CBP requirements, the process must be discussed in advance. You’ll have to give that person accurate and complete information regarding the transaction.
- In some cases, identical merchandise or transaction may be dealt with differently at a port’s various CBP offices or at different ports. In this care, CBP officials must be informed.
- You’ll need to provide the CBP with an accurate and complete description of your heavy equipment. You’ll also need to give them your items’ appropriate tariff classification.
- You’ll need a CBP ruling for your items’ tariff classification and description.
- If the equipment’s tariff classification and description isn’t available immediately, then you must create a procedure through which you can obtain and forward it to the CBP.
- Your equipment will need to be classified by the CBP.
- The tariff schedules, CBP rulings, court cases, and compliance publications will need to be consulted in order to classify and describe your items correctly.
- You’ll need to speak to an expert to help you with classifying and describing the items.
- If you want a special tariff or conditionally free provision or classification, you’ll need to verify your item to ensure it qualifies. You’ll also need the right documentation to make this claim.
- Finally, you’ll need reliable procedures to produce and maintain the proper paperwork and the information that supports it.
Measuring and assessing compliance
Compliance assessment consists of systematically evaluating the systems which support an import’s CBP related activities. Included in the assessment is testing financial and import transactions, checking the internal control’s adequacy, and seeing if the importer is compliant in important areas.
An Interdisciplinary team including an account manager, CBP auditor, industry expert, CBP specialist, and import specialist will conduct the assessment. It uses statistical sampling accepted by professionals as well as auditing techniques to check import transactions conducted in the last fiscal year by the company.
The following customs operations will be evaluated through compliance assessment:
- Trade programs like CBI and GSP,
- Transshipments of the items,
- Operations within foreign trade zones or warehouses,
- The value of the heavy equipment,
- Conformity to quota,
- Countervailing or antidumping duty operations,
- The number of items,
- Trade statistics and classification of the items,
- Record keeping.
If a company complies with CBP regulations and laws, they’ll get a report proving it. Companies with noncompliant systems will receive a report as well. They’ll need to create, with the help of a CBP advisor, an improvement plan stating the corrective actions they will take in order to make the equipment compliant. If there are grave law violations, the CBP may put the company through an investigation or use other enforcement methods.
The CBP must give the importer an advance notice of an assessment they intend to make as well as how long this assessment will take. Importers have the right to a conference regarding their items’ entry, where the purpose of the assessment as well as its duration must be explained.
With information about the industry or the company, the team in charge of compliance assessment can prepare questionnaires requesting certain information regarding the internal procedures of the importer. The entry conference is also the place where these questionnaires are handed.
After the assessment is complete, a closing conference will be scheduled by the CBP. Here, the importer will learn the assessment’s preliminary findings. If there are grave enforcement issues, the CBP has the option of not organizing a closing conference. In the case where enforcement actions were not taken, the company will receive the assessment results’ report in writing.
The commercial invoice
The shipper or agent’s commercial invoice is valid if it was created according to CBP regulations. Broker and importers that use the ABI can send data through EDIFACT instead of using physical documents. According to the Tariff Act, the information which needs to appear on the invoice is as follows:
- The entry port where the heavy equipment is going.
- If the equipment is going to be sold, the place, names of the seller and buyer, as well as the time will be necessary. If the item is consigned, the names of the receiver and shipper, as well as the origin and time of the shipment will be needed.
- The equipment’s detailed description. It must include the name of the equipment, its type, etc.
- If the item was sold, its price in the sale currency must be mentioned.
- If the shipment is made for consignment purposes, each item’s value must be mentioned in the currency of the transaction.
- The origin country.
If the equipment present in the paperwork is sold during its transport, the initial invoice showing the transaction, as well as the resale invoice, must be filed. All documents, including the invoice, must be written in English or contain an English translation.
Items entering the US may be subject to duty payments depending on their classification in the US Harmonized Tariff Schedule. If your equipment is ad valorem dutiable, compound or specific rates can be assessed. Such a rate is only a percentage of the item’s value.
Duty rates for imported equipment can differ according to the origin country. For lots of items, the duty tax is paid according to the most favored nation rates.
Heavy equipment’s dutiable status is decided upon by the CBP during the liquidation of the entry after filing the entry paperwork. If more information is necessary, trial shipments shouldn’t be used, since the next one may receive a different tariff treatment.
United States taxes and duties cannot be prepaid in another country before the equipment is exported to the US. Usually, duty payment liability is fixed when the entry is done with the CBP. The firm or person who filed the entry must pay the tax.
If your customs broker does not pay customs charges, the importer will be liable even if he had previously paid the broker. Because of this, in cases where you’ve paid using a check, a separate one should be used that’s only payable to the United States border protection and customs for the customs charges you want paid.
In cases where the customs broker makes an entry in his/her name, he/she may not have to deal with statutory liability for paying additional or increased duties if he names the items’ actual owner, and if there’s a declaration from the owner through which he takes on additional duty. The owner of the import’s bond must also be filed at the port director by the broker in less than 90 days since the entry date.
If you disassemble your heavy equipment before shipment, you may be able to transport it in a container. The CBP considers containers as international traffic instruments. When this designation is applied, articles like containers aren’t included in the duty tax upon arrival. Them being empty or full makes no difference.
However, those using containers need to apply to the CBP commissioner to obtain this designation. If an item designated as such changes from commercial to domestic use, a duty tax will have to be paid.
One can obtained liability relief under bond when the items being imported are destroyed under the supervision of the CBP. This must be done within the bond period.
Shippers that need a formal entry may obtain duty free status through the GSP by adding in the summary mentioning that the origin country is considered a beneficiary developing nation. Eligible items will not be taxed with duty if these conditions are present:
- The beneficiary country has produced the item. This is valid when:
- The items were fully manufactured or produced in the beneficiary country,
- When the equipment was built with materials brought from other countries that were transformed substantially in order to build the machinery.
- The heavy equipment must be directly shipped from the beneficiary country to the US customs territory.
- The produced materials from the beneficiary country as well as the processing must cost 35% or more of the items’ value.
One can include the value or cost of the materials brought into the developing country in the 35% GSP requirement if the materials went through a double transformation of substantial proportions while in the beneficiary nation. The materials must be changed substantially in the developing country into different and new commerce articles that will be transformed again in order to produce the final product (the equipment).
When talking about direct processing costs, we mean costs incurred directly while processing the article. They may include labor costs, tools, molds, dies, the used equipment and machinery’s depreciation, development and research, testing, and inspecting, etc.
General expenses and profits are not part of direct processing costs. We can consider as a general expense insurance, sales employees salaries, administrative salaries, etc.
Importing heavy equipment from China
Cities and provinces that build machinery in China are the following:
- Kunshan, Jiangsu
- Xuzhou, Jiangsu
- Shanghai, Shanghai
- Changzhou, Jiangsu
- Jinhua, Zhejiang
- Rui’an, Zhejiang
- Wenzhou, Zhejiang
- Ningbo, Zhejiang
- Tai’an, Zhejiang
- Jinan, Shandong
- Qingdao, Shandong
- Shenyang, Liaoning
- Dongguan, Guangdong
To import heavy equipment, as well as replacement or custom parts from China, the following steps will help:
- Put technical specifications in writing. If your items can be considered factory products, then a specification list will be needed. It will contain the product’s details as well as other relevant information.
You’ll need to provide detailed information about your equipment, including its control system, weight, protection class, efficiency percentage, motor usage, model, and function.
- Safety standards need to be met. These will always apply when shipping towards the United States, Europe, and Australia. In case these standards aren’t met, then a large fine may be applied, your equipment may be forcefully recalled, or customs may claim and detain it.
Most machinery from China does not conform to US mechanical and electrical safety standards. The ASTM will decide what standards your equipment will need to meet when entering the US. These will vary depending on the item you’re buying.
There are situations where the standards of other organizations must be met as well. These can be the ANSI, RIA, ISA, the NFPA, or the UL.
- A test report will be necessary to ensure the item is safe for transport. If you’ve already tested your equipment through a third party, this step can be skipped. The report will have to contain the item’s ID, the issuing company, its manufacturer, and the date on which the report was sent.
- Whether or not the equipment will need some parts replaced will need to be determined. Also, a warranty may be needed. If you require spare parts for the heavy equipment, you as the customer will have to pay for their transport. However, when possible, it’s best to get them from the United States in order to avoid delays and transport fees.
- There’s a chance that your heavy equipment may be sent to you without it being tested for quality. Ideally, you should check this matter and do the test yourself if necessary.
If the heavy equipment arrives defective or broken, it can be hard to send it back. Your shipment may be blocked by China, and a refund may not always be given.
- If you’ve gone through the above steps and there have been no problems, then the equipment can be shipped safely. It will have to pass customs first, but if the paperwork is good, there shouldn’t be any problems.
Heavy equipment import duty on those sent from China
The tax that will have to be paid once your heavy equipment crosses international borders into the US is known as the import duty. The person paying this tariff is generally known as the record importer. He is the one selling the items or the one buying them depending on what arrangements were made between the 2.
Through the HTS or harmonized tariff schedule, your purchase’s import duty can be calculated. The WTO uses this system for determining duties. In general, your duty tax will be a percentage of the heavy equipment’s total value. The rate will either be per piece or per pound.
The import rate is usually 3-25% on Chinese items. When buying a customs bond, in order to figure out your shipment’s import duty, you should speak to your broker.
Importing heavy equipment from Canada
Thanks to the proximity between Canada and the US, transport fees are significantly lower and regulations may be simpler to comply with as well. Of course, there may be fewer options when compared to other countries. However, if you can find the equipment you need, then there’s no reason not to proceed with the purchase.
The first step in bringing the equipment over is getting a PAPS number. It will act as a control number for your shipment. When the import is approved, the information will be passed down to the customs broker.
Afterwards, the transport company will use the information found on the PAPS number to make the shipment manifest. This will be used whenever the company needs information on the shipment.
U.S. customs will them receive the manifest before the equipment is shipped. At this point, the equipment can get delayed for various reasons. If there are no problems with the item or with the document, it will proceed as planned.
The equipment’s supplier may request a PAPS number confirmation, a commercial invoice, or a truck waybill. They’ll be needed for the equipment to get past customs.
Finally, your order will enter the United States. Your trucking company may extend the checkpoint at the border in order to obtain clearance. This immediate transport setup will cost around $100 more money and reduce the transport’s speed. However, you should take it into consideration since it may happen depending on the situation.
When it comes to the duty tax, if your heavy equipment was fully produced in Canada, you won’t have to pay it. To prove the item’s authenticity, you’ll need an Origin certificate from the USMCA. If the equipment’s seller doesn’t give you this certificate, you’ll have to pay duty fees.
Tractors are one of the most common heavy equipment imported into the United States. Being an engineering vehicle of sorts, they’re mainly used in agriculture and construction. Despite their low travel speed, they can pull trailers and machinery easily. They can also be used to tow vehicle.
There are tractor building companies throughout the world, so it can be very beneficial to import them. Japan, China, and Canada all export tractors towards the US on a regular basis. Tractors built in Europe are used as well.
If you’d like to buy a tractor from abroad, bringing it over is similar whether you’re bringing it from Europe, Canada, or China. Of course, there are some separate regulations and rules regarding the exportation of goods imposed by each country. When importing from Europe, VAT regulations will also have to be considered.
To avoid problems, it’s best to seek the services of a licensed broker. You can also consult US Customs Clearance if you wish to understand the process.
When it comes to Chinese imports, the process is similar for all machinery. The tractor’s technical specifications will be needed. You’ll have to prove it meets EPA standards, as well as any other safety standards mandatory in the US.
A test report will also be needed. You’ll have to determine warranties and parts replacements when applicable. Furthermore, testing and quality control is obligatory.
Final tips for heavy equipment importers
- Customs invoices must contain all the required information.
- Each invoice must be typed out clearly. There should be enough space between the lines, and data must be contained in its respective column.
- You must provide a description of every item you plan on importing.
- Add the origin country in your invoice unless the origin country doesn’t need to be specified for this particular equipment.
- Make sure your import complies with all US special laws that may apply.
- Read and closely follow all instructions pertaining to labeling, marking, invoicing, etc.
- Ensure good security measures during transport and at your company’s facility. Make sure drug smugglers don’t have the chance to sneak narcotics into your equipment.
- If you rely on a customs broker to help you with the transaction, it’s best to use one that uses ABI (automated broker interface).
Written By:Joe Webster
Joe Webster began his journey in the auto transport field by attending the University of Southern California (USC), where he graduated with a Bachelor of Business Marketing.
After college, he started his career in the auto transport industry from the bottom up and has done virtually every job there is to do at A-1 Auto Transport, including but not limited to: Truck Driver, Dispatch, Sales, PR, Bookkeeping, Transport Planner, Transport Manager, International Transport Manager, Brokering, Customer Service, and Marketing. Working with his mentor Tony Taylor, Joe Webster has learned the ins and outs of this industry which is largely misunderstood.
With over 30 years experience in the industry, we've been helping people ship their vehicles, motorcycles, RV's, heavy equipment, household goods and more across the country or overseas without a hitch. Ask us anything.
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