Exhibiting at a trade show outside the United States? You can avoid paying duties and taxes and speed up customs clearance procedures on a product you want to bring temporarily to another country for an exhibition or other reason. To do so, however, requires special documentation such as an ATA Carnet.
Temporary Imports, ATA Carnet
Temporary importation provisions are an important tool for companies wanting to show their products in foreign markets, or for professionals bringing tools of the trade into a foreign country for a limited period of time. Companies have several options when considering temporary importation: ATA Carnets, Temporary Importation Bond (TIB), and entry with duty drawback. There are also provisions in free trade agreements allowing duty-free treatment for temporary admission of certain goods such as professional equipment or commercial samples.
The ATA Carnet system is the most user-friendly system of temporary importation accepted by some 80 countries. New countries are being added, so check with carnet-issuing agencies to make sure that your destination country accepts ATA Carnets. For countries that don't accept carnets, companies can post TIBs or apply for a duty drawback as an alternative means to duty-free importation (check with a customs broker or freight forwarder for your best options).
What Is An ATA Carnet?
The ATA Carnet, also referred to as a "Merchandise Passport," is an international customs document which allows for temporary entry of goods on a duty-free and tax-free basis, whether shipped or hand-carried. The ATA Carnet system was established by the International ATA Convention, and is governed by the World Customs Organization, and the International Chamber of Commerce's World Chambers Federation. The aim is to encourage world trade and reduce trade barriers created by different national customs regulations. The initials "ATA" are from the French and English words "Admission Temporaire/Temporary Admission." U.S. Customs appointed US Council for International Business as National Guaranteeing Association (NGA).
Companies are required to present ATA Carnet documentation to U. S. Customs when leaving the country, and upon entry into and exit from the foreign country. Upon return, the company must again show the carnet document to U.S. Customs for duty-free entry back into the United States. The carnet also serves as the registration of goods for the U.S. and eliminates the need for a U.S. Customs Certificate of Registration Form 4455. ATA Carnets cover most personal and professional goods, including commercial samples, professional equipment, and goods intended for use at trade shows and exhibitions. Carnets do not cover consumable or disposable items, and are not recommended for situations where some products taken abroad may be sold in a foreign country. However, carnets are particularly useful when a product may “travel” to several countries prior to being returned to the United States. They are in effect for up to one year, with possible extension for another year.
Where Can I Use an ATA Carnet?
The ATA Carnet is accepted by many countries and territories worldwide. For a complete list of countries and territories covered by carnets, contact US Council for International Business (USCIB):
ATA Carnet Department
1212 Avenue of the Americas
New York, NY 10036
Telephone: (866) 786-5625 or (800) 5DUTYFREE (538-8937);
Fax: (212) 944-0012
What are the benefits of the ATA Carnet?
- Eliminate duties and value-added taxes (VAT);
- Simplify customs procedures allowing a temporary exporter to use a single document for all customs transactions, make arrangements in advance, and at a predetermined cost;
- Allow for an unlimited entries/departures for up to one year;
- Facilitate reentry into the U.S. by eliminating the need to register the goods with U.S. Customs at the time of departure;
- Eliminate need to file an Electronic Export Information form (former Shipper’s Export Declaration) except for those exports that require an export license;
- Eliminate the need for Temporary Importation Under Bond (TIB).
Note of caution: ATA Carnets DO NOT exempt the holders from obtaining necessary export licenses or permits.)
How do I Apply for an ATA Carnet?
ATA Carnets may be obtained from the USCIB or from two other officially-appointed carnet service providers: Boomerang Freight Solutions and Roanoke Trade Services. In addition, exporters may contact other parties such as brokers and freight forwarders who can assist with ATA Carnet preparation; however, the carnets will be issued by the designated service providers.
Exporters can obtain ATA Carnets and carnet bond services via an online application process.
How Much Does a Carnet Cost?
The value of the shipment determines carnet processing fees.
How Long Does it Take to Process an ATA Carnet?
It can take two business days to process a carnet application if the application and security deposit are received by 4:00 pm ET.
What if I Lose my Carnet Documents?
The USCIB or its two designated service providers offer warranty coverage for lost, stolen, or destroyed carnet forms for a fee. The USCIB will issue an immediate replacement to customers with this warranty. Full terms and conditions of carnet warranties are available when submitting an application electronically, or by contacting an ATA Carnet consultant for details.
Can I Sell the Goods Covered Under ATA Carnet?
Carnets are NOT recommended for goods intended for sale. Should some of the goods be sold, carnets are subject to a penalty equal to 10% of the amount of the duties and taxes in addition to the payment of duties and taxes for the goods sold off. A USCIB claims handling fee may also apply.
For goods sold off ATA Carnet, a company needs to contact a local customs office to determine the most appropriate procedure. Some countries such as U.K. and Australia tightly control the sale of goods accompanied by carnets. Generally, local customs will request that the goods and ATA Carnets be brought to the local office prior to Carnet expiration. This is done so that the carnet may be properly discharged and duties, taxes, and penalty paid.