In this episode of the International Trade Resource Podcast, host Kim Kirkendall chats with Emmet McGovern, a seasoned trade compliance expert about the often-overlooked but critically important world of importer liabilities and risks. Together, they unpack the role of the Importer of Record, explaining how legal responsibility for declaring goods, paying duties, and maintaining accurate documentation ultimately falls on whoever is listed as IOR. Listeners will gain clarity on why simply relying on your supplier or freight forwarder isn’t enough to shield you from potential penalties.
They then dive into the nuts and bolts of what it takes to stay compliant—everything from choosing the right customs bond (single-entry vs. continuous) to declaring the full ten-digit HTS code, proper valuation of your goods (including assists and tooling fees), and correctly stating the country of origin. Real-world examples of tariff-circumvention schemes, such as undervaluation tricks and transshipment fraud, bring home just how costly even small errors can be.
Next, Kim and her guest walk through best practices for audit preparedness and recordkeeping, emphasizing the five-year retention requirement for documents and they list critical ones for you. They also discuss foreign sellers acting as the Importer of Record or under DDP terms. Finally, listeners are armed with proactive strategies to transform customs compliance from a risk into a competitive advantage.
Key Takeaways:
- Who is legally responsible for accuracy of customs documents and payment of duties.
- The importance of HTS codes and all valuation components.
- How to do self-audits, and prepare for a customs audit.
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