Industry Opinion: Dos and don’ts of China-US shipments

I have spent my morning warning people not to misdeclare the origin for Chinese shipments heading to the United States.

Here are some hints so you don’t end weeping into your wine:

1. A couple of Australian forwarders are advising if product is in Australia for up to 100+ days, it can be declared as Aus origin. Truly, you cannot. I’m right, they’re wrong.
2. At least one Chinese forwarder is offering a per kilo rate including duty to the US (danger, Will Robinson, danger). 
   Remember the dumping debacle where Chinese forwarders tried shipping steel and aluminium through third countries, and redoing invoices? The US isn’t stupid (well, not all of them anyway).
3. Consider changing the source of manufactured product to suppliers outside China with consideration of what rates will be in 90 days (but will they? Who knows?) and provided they’re not moving factories or machinery etc., just yet as who knows what is happening.
4. Explaining what is a process of simple assembly that may discount there being a change in origin, such as two parts ex-China screwed together elsewhere in Asia or Australia and shipped from that third country. Remember the koala case? Origin is where goods get their identity.
5. Be careful of ChAFTA for importing goods ex China to Australia for supply to the US. Packing doesn’t count in an origin calculation unless it’s an RVC calculation for an FTA. Just packing in a third country does not change the origin of the goods. Simple assembly probably doesn’t either.
6. Penalties from the US for misdeclaration won’t just be 20%. It’s not worth gaming it. They will audit past consignments, and future consignments will be delayed.  As a company director their ability to travel to the US in future could also be impacted (but seriously, who wants to go there at the moment?)
7. Penalties from Australia for consignments ex-Australia where goods transit or are stored in Australia ex-China and origin is not correctly declared on EDN is roughly $9500 per error.
8. Considering how litigious the the US is, if you give advice, is your insurance up to date?

By the way, everybody owes me a drink!

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