Complexities of Hand Carrying Import or Export Items

Commercial hand carries are classified as imports or exports and therefore necessitate the same compliance reviews as items shipped in standard packaging.

Does your organization engage in the hand-carrying of commercial items for import or export? If so, do you have a formal policy or procedure in place to ensure compliance with relevant regulations?

In today’s globalized world, it’s not uncommon for travelers to find themselves in a position where they need to transport commercial items across borders. Whether you’re a small business owner attending a trade show or a Fortune 500 company employee taking a spare replacement part to a customer, hand-carrying commercial items can present a unique set of challenges. Not only do you have more issues to deal with when you hand carry, you also have the potential for an export violation occurring.

Here’s a closer look at the issues you might encounter when bringing commercial goods with you on your travels.

1. Customs Regulations and Compliance

One of the most critical factors to consider is the customs regulations of both your departure and destination countries. Unlike personal items, commercial goods are subject to stricter scrutiny. Each country has its own set of rules regarding what can be imported or exported, often requiring specific documentation. Failing to comply can lead to confiscation, fines, or even legal repercussions. It is important to have a representative from a customs broker either meet the traveler at the airport or ensure that the proper documentation is submitted to Customs and documents given to the traveler.

• Prohibited Items: Certain goods may be banned entirely, including certain electronics, chemicals, or agricultural products.
• Import Licenses: Some items require licenses or permits to import, which can complicate your travel plans.

2. Duty and Tax Implications

When transporting commercial items, you may be liable for duties and taxes. Many countries have a de minimis threshold—an exemption limit below which no duties are charged. However, if your goods exceed this limit, you could face unexpected costs upon arrival.

• Calculation of Duties: Understanding how duties are calculated based on the value and classification of your items is essential. Make sure to keep receipts and invoices handy for accurate reporting.

3. Documentation Requirements

Proper documentation is crucial when hand-carrying commercial goods. This may include:

• Commercial Invoices: Detailing the nature of the goods, their value, and the terms of sale.
• Shipping Labels: Even for hand-carried items, having a shipping label can help clarify the intended use of the goods.
• Export Declarations: Some countries require a formal declaration for goods being exported.

Not having the correct paperwork can lead to delays at customs or even the refusal of entry for your items.

4. Security Screening

Airports have stringent security measures that apply to all passengers, but commercial items may attract extra attention. Security personnel may need to inspect your goods, especially if they are bulky or unconventional.

• Prohibited Items: Make sure none of your items are on the prohibited list for air travel, as this could result in confiscation or delays.

5. Risk of Loss or Damage

When you carry commercial goods, the risk of loss or damage increases. Airlines typically offer limited liability for lost or damaged luggage, which may not cover the full value of commercial items.

• Packaging: Ensure that items are securely packed and protected against potential damage during transit.
• Insurance: Consider purchasing travel insurance that covers commercial goods for added peace of mind.

6. Personal vs. Commercial Use

Customs officials may scrutinize the distinction between personal and commercial items. If you carry multiple units of the same product, they might question your intentions.

• Clarity of Purpose: Be prepared to explain the purpose of your items and provide documentation that supports your claims of personal use versus commercial intent.

There can also be issues when an employee travels with a company laptop to a foreign destination. Recently, RTX reached a settlement of $200 million with the US State Department on over 750 export violations. Some of these violations were caused when employees were travelling abroad with their company laptop. Under all these instances, when the employee was in the foreign country they had attempted or successfully logged into their computer that contained ITAR controlled material on them.

It is important to be aware of what is on your laptop and whether an employee will be accessing ITAR controlled materials. If there isn’t a reason for access to the controlled materials, then it is always best to have a sanitized laptop for an employee to travel with.

Conclusion

Hand-carrying commercial items across borders can be a complex endeavor. It is essential that hand-carried items include a commercial or proforma invoice and any applicable licenses or license exceptions. All commercial items must be declared to Customs upon arrival in the importing country. Additionally, any customs duties or taxes incurred must be paid, and the traveler should retain receipts for these payments. It is advisable to avoid cash payments for duties, and your company should establish clear policies and procedures to manage these transactions.

Prior to departure, all hand-carried items should receive approval from internal trade compliance personnel to ensure there are no issues related to export compliance and to determine if additional requirements, such as an export license, are necessary. With careful planning and awareness of potential challenges, you can confidently navigate the intricacies of transporting commercial goods

Do you need help with setting up an export or import compliance program?  Schedule a no-charge consultation with one of our team members today.