Let's Talk Smuggling....er....Importing

[VT Andrew]

In my previous life, I worked in imports/exports. I am actually a federally licensed customs broker. I'd just like to open the floor for a discussion on importing in this industry. By my estimates, I'd say roughly 3/4 of the products imported by vendors in this industry are either fraudulently imported, or borderline smuggled into the country.

If you are purchasing ANY product and NOT paying duties, it's probably ILLEGAL (unless it's under $200 and for your own personal use, which is covered by Section 321). If the shipper declares an INCORRECT VALUE...YOU as the US IMPORTER OF RECORD are responsible, and therefore breaking the law by avoiding Customs duties and merchandise processing fees.

Thoughts?

 

[VT Andrew]

Ex. Any time you order a package and the value declared on the side of the box (or on the paperwork attached) does not declare the value that you paid, it's likely being done so to bypass Customs and Border Protection duties and fees. And CBP doesn't NOT like this. Penalties for getting caught could be upwards of $50,000 for the first offense, and you will NOT be able to plead ignorance...

For this reason, and the fact that there are no proper classifications in the Harmonized Tariff Schedule, I rarely will import anything. That being said, the few times where I have purchased high-end mods from overseas, I have educated the shipper/mod maker on the proper way to declare the values.

Usually, a mod maker or small company will be more than happy to declare the actual value, but often times I'm met with "That will make you pay higher fees, we declare low value to save you money" This is fraud, and complete ignorance by someone who KNOWS that they have no responsibility. You as THE IMPORTER will be the one who gets burned...

 

[CaFF]

Well, I've never bought anything vaping related that was even close to $200...hell, not even close to $100.

Hmmm, three-quarters seems awful high though...

As far are the Chinese suppliers go, or the relations they have with US vendors, that would be just conjecture on my part. However, I don't see how as a purchaser I'd be held liable for a vendor or supplier's malfeasance. I'd just lose my money and they'd be in trouble AFAIK. Like the recent seizures of goods in the Hana case.

It's sort of like the IT biz; end-users (buyers in our case) don't have a clue of what goes on behind the scenes and they usually don't want to.

I used to buy a lot of extreme hot sauces from the UK, AU, etc. Never once did I see any customs paperwork. That was all done by the seller. Now, when I sent stuff to the UK, then yeah, I had to fill out Customs forms with valuation and the like.

I could be wrong, but It seems you should be having this convo with the vendors more than with the end-users.

 

[VT Andrew]

VENDORS being the key word. If you're just buying stuff for your personal use, there's no worries.

If you think that a foreign based entity is going to bare any responsibility in an importing case with US Customs, you are sadly mistaken. That's why most companies hire 3rd party customs brokers like myself to ensure that their imports are properly declared with CBP.

All I'm saying is that if you're importing INVENTORY, and you're not at least getting a DHL bill for duties and fees, you should start looking at the declared values on the packages because it's likely that something fishy is going on...

 

[CaFF]

Agreed. As an end-user, I'm not buying 50 Vamos from China or thousands of dollars worth of merch.

IDK how you'd have the same discussion with vendors or peeps on FB or Ebay....kinda think that would not go well.

 

[Hobby Kid]

Your post's made me think a bit. I'm in the uk. I buy from Shenzhen regularly. Usually 100 - 200GBP purchases. So I just looked at my last invoice. Tbh I hadn't event taken it out of the sticky sleeve on box's side. I'm looking at a dhl shipment waybill. It says 'declared value at customs: $40'. I paid 150GBP. Who's responsible?

In the UK anything purchased outside the EU over 20GBP is subject to import charges regardless of whether it's for domestic or business. Things fly through customs when trading with the Far East. This package arrived in 4 days. But if I purchase anything from the USA it gets held at customs for longer than that and I get charged duties + handling fees. There's a lot of stuff which I want to get from the USA but as one particular UK vendor said (similar to Madvapes) they won't sell many of the much requested parts because after import fees it's not financially viable.

 

[VT Andrew]

I have NO knowledge of how Customs works in other countries, but if you are IMPORTING products in the US, YOU are the Importer of Record and thus FULLY responsible for declaring the proper information to Customs and Border Protection.

The reason that it's tough to get products FROM the US is because we have declarations on the imports AND exports, so a reputable business like Madvapes is responsible for exporting the goods properly, just the same as they import the goods properly.

Once again, ignorance is not an acceptable excuse. The government views it as "If you're smart enough to import something, you should be smart enough to do it properly."

 

[Hobby Kid]

.....
Once again, ignorance is not an acceptable excuse. The government views it as "If you're smart enough to import something, you should be smart enough to do it properly."

True that.

 

[VapingCuban]

So how would that work with big group buys?

 

[tick22]

This is a "Nice to Know" thing for sure.
I now know why my invoices are always low...
FIY I am a end user buyer, not reseller...

My Brother in Japan always tells me to price and list anything I send to him as certain things and price, no matter what I send him.

Import/export laws vary from Country to Country I gather. What a mess...

 

[jack]

shit , since when does anyone care who or what or how anything crosses the U.S. border . I needed a good laugh , LMAO .!!! In Texas that is a real friggin joke .

 

[VT Andrew]

It's good to know for vendors who are unaware of the consequences.

Also, you can bet your ass when CBP gets around to adding our industry's products to the HTS listing, they'll be LOOKING for products that aren't classified correctly, which will give them an easy way to examine these shipments and make life HELL for importers in this industry.

 

[VT Andrew]

So how would that work with big group buys?

This is a case where whoever is running these buys should ensure that their imports are on the up-and-up because these are likely being declared improperly, and this could result in the entire shipment being held or seized by CBP.

 

[Hobby Kid]

Jack was possibly referring to people rather than merchandise

 

[VT Andrew]

It can get complicated as more parties involved, but in the case of "formal shipments" which are valued at $2000+ the importer should be reported on customs documents with their EIN or Social Security #

If ANYONE has specific questions, I'm very knowledgable when it comes to customs and imports.

 

[jack]

With all due respect VT Andrew, at this point it is really a non issue . Over that, China has a border , Mexico and Canada have borders, we do not
have a border. No one checks the stacks of containers, and trade in ports like San Diego or Houston . No one looks into things like this until someone
makes a big stink about it , and then it takes months . The U.S.P.S. and others can't do their jobs now .

 

[VT Andrew]

I'm putting this out there for vendors. You know, the guys who want to have a reputable and upstanding business and not get into legal issues. Most vape shops and sites are run by everyday Joes who might not even realize that this is occurring until it's too late.

Regardless of if this is already rampant, most of us want to be better businessmen no matter where this industry takes us...

 

[VT Andrew]

And for many small vendors in B&M shops, a $5000 package being delayed by a week or two or more could do serious damage to your business. I'd rather pay the 3% and know I'm doing things the legal way...

 

[VapingCuban]

And for many small vendors in B&M shops, a $5000 package being delayed by a week or two or more could do serious damage to your business. I'd rather pay the 3% and know I'm doing things the legal way...

Peace of mind goes along way I agree but looks like in this industry everyone is cutting corners, selling clones, etc so imagine having to ask them to pay more. Lol

 

[creedthevaper]

There are lots of ways to buy products that are imported from China, that don't fit into ny of this. I give you angelcigs as an example. they import there own products to the us and then sell them from here in the US. the prices are so close to that of fasttech etc. that it is not worthtalking about. There are other way to beat that system wiith ouy breaking the law.

 

[VT Andrew]

There are lots of ways to buy products that are imported from China, that don't fit into ny of this. I give you angelcigs as an example. they import there own products to the us and then sell them from here in the US. the prices are so close to that of fasttech etc. that it is not worthtalking about. There are other way to beat that system wiith ouy breaking the law.

This is why we started our business as a Totally Wicked re-seller, and then moved on to better US resellers when the option became available. I'd bet you that ALL of the big wholesale companies that are US based have a federally licensed customs broker on call at all times to clear their shipments legally...