International Trade & Customs Policy

1. Policy Overview

Global Compliance:

Upmos operates as a multinational marketplace and complies with all applicable international trade laws, customs regulations, and export control requirements.

Scope:

This policy applies to:

• All international shipments and cross-border transactions
• Import and export documentation requirements
• Customs duties, tariffs, and VAT collection
• Trade agreement compliance (USMCA, etc.)
• Restricted and prohibited goods by jurisdiction

Our Commitment:

• Accurate customs classification and valuation
• Timely regulatory documentation
• Cooperation with customs authorities
• Compliance with sanctions and trade restrictions

2. Customs Documentation Requirements

Mandatory Documentation:

Commercial Invoices:

• Detailed description of goods
• Unit prices and total value
• HS codes (Harmonized System codes)
• Incoterms and payment terms

Packing Lists:

• Item-by-item breakdown
• Packaging dimensions and weights
• Package contents and quantities

Certificates of Origin:

• Country of manufacture
• Required for preferential trade agreements
• Issued by authorized organizations

Import/Export Permits:

• Required for restricted categories
• Seller responsible for obtaining
• Must be attached to customs documents

3. Harmonized System (HS) Codes

Code Requirements:

All products must be classified using the Harmonized Tariff Schedule (per the International Convention on the Harmonized Commodity Description and Coding System, administered by the World Customs Organization):

• 6-digit minimum (many countries require 8-10 digits)
• Must match product description exactly
• Incorrect codes delay customs clearance
• Sellers are responsible for accuracy

Categories Requiring Special Codes:

• Electronics and technology
• Textiles and apparel
• Chemicals and pharmaceuticals
• Food and beverages
• Metals and minerals

Resources:

• Official HS Code Database: https://www.wcoomd.org/
• Country-specific tariff schedules available through customs authorities

4. Valuation For Customs Purposes

Customs valuation follows the WTO Valuation Agreement (Agreement on Implementation of Article VII of GATT 1994) and 19 U.S.C. § 1401a.

Valuation Rules:

Transaction Value (Primary Method):

• Price actually paid or payable
• Plus royalties and license fees
• Plus assists (materials provided by buyer)
• Plus commissions and costs
• Less allowable deductions

Declared Value:

• Must match invoice price
• Cannot be artificially understated
• Subject to customs audit and penalties
• Fraudulent valuation violates law

Appraisal Authority:

• Customs may appraise goods independently
• If declared value appears false
• Seller liable for underpayment penalties

5. Duties, Tariffs & Taxes

Duty Calculation:

Base Rate:

• Determined by HS code classification
• Varies by country and trade agreement
• Subject to anti-dumping duties
• May include safeguard duties

Most Favored Nation (MFN) Rates:

• Applied to products from WTO members
• Generally lowest available rates

Preferential Rates:

• Available under trade agreements (USMCA, etc.)
• Require Certificate of Origin
• Only for eligible countries and products

Value Added Tax (VAT):

• Collected in most countries
• Calculated on landed value (price + duties)
• Upmos assists with VAT collection and remittance

6. Import Procedures & Customs Clearance

Standard Import Process:

Step 1: Pre-Arrival Notification

• Advance Shipment Information (ASI)
• Filed 24-48 hours before arrival
• Enables pre-clearance processing

Step 2: Customs Entry Filing

• Broker or customs agent submits entry
• Includes invoices, packing lists, permits
• Filed within 5 business days of arrival

Step 3: Customs Examination

• Physical inspection may be required
• Data review for compliance
• Verification of declared values and codes

Step 4: Assessment & Payment

• Duties and fees calculated
• Payment required before release
• Refund possible if entry corrected

Step 5: Release & Delivery

• Goods released to importer
• Delivered to final destination

7. Export Regulations & Controls

Export controls are governed by the Export Administration Regulations (EAR, 15 CFR Parts 730–774), International Traffic in Arms Regulations (ITAR, 22 CFR Parts 120–130), and the Export Control Reform Act of 2018 (50 U.S.C. §§ 4801–4861).

Export Requirements:

Export Declarations:

• Shipper’s Export Declaration (SED) required
• Filed electronically (eManifest)
• Contains product HS codes and values
• Shipper/seller responsible

Restricted Export Categories:

• Dual-use items (civilian and military)
• Technology and encryption products
• Certain metals and minerals
• Products with license restrictions

Country-Specific Restrictions:

• Certain countries have trade restrictions
• Sanctioned countries prohibit all trade
• License may be required for specific countries

End-Use Verification:

• Buyer use must be legitimate
• High-value items may require verification
• Penalties for unauthorized end-use

8. Sanctions & Restricted Parties

Sanctions compliance is governed by the International Emergency Economic Powers Act (IEEPA, 50 U.S.C. §§ 1701–1707), OFAC regulations (31 CFR Part 500), EU Council Regulation (EC) No 2580/2001, and the EU Global Human Rights Sanctions Regulation (2020/1998).

Trade Sanctions:

Sanctioned Countries:

Upmos does not conduct transactions with:

• Iran
• North Korea
• Cuba
• Syria
• Crimea (Russian-occupied)
• Other countries designated by OFAC

Restricted Party Screening:

• OFAC SDN (Specially Designated Nationals) list
• Denied Parties List (BIS)
• Entity List (BIS)
• Unverified List (BIS)

Screening Process:

• All buyers screened against restricted lists
• Transactions blocked if match found
• Seller must verify customer legitimacy

Penalties:

• Civil penalties up to $250,000+
• Criminal penalties up to $1 million
• Account termination on Upmos

9. Trade Agreements & Preferential Treatment

Trade agreements are implemented under 19 U.S.C. §§ 4501–4732 (USMCA Implementation Act) and EU Regulation 978/2012 (GSP).

USMCA (United States-Mexico-Canada):

• Duty-free treatment for eligible products
• Requires Certificate of Origin
• Rules of origin requirements must be met
• Valid for 4 years

EU Trade Agreements:

• Generalized System of Preferences (GSP)
• Duty preferences for developing countries
• Form A certificate required

Other Agreements:

• Regional trade partnerships
• Bilateral agreements
• Subject to specific rules and requirements

Eligibility:

• Product must meet rules of origin
• Seller must provide proper documentation
• Buyer must claim preference

10. Prohibited & Restricted Goods

Strictly Prohibited:

• Weapons and explosives
• Narcotics and controlled substances
• Counterfeit goods
• Endangered species (CITES)
• Hazardous materials (without permits)
• Radioactive materials

Country-Specific Restrictions:

Vary by destination:

• Agricultural products (phytosanitary certificates)
• Electronics (electromagnetic compliance)
• Food products (health certificates)
• Textiles (visa requirements)

Seller Responsibility:

• Research destination country restrictions
• Obtain required permits before shipping
• Document compliance efforts
• Liable for violations

11. Labeling & Marking Requirements

Country of Origin Marking:

• “Made in [Country]” required
• Must be clear and conspicuous
• For finished products only
• Language of destination country preferred

Warnings & Hazard Labels:

• Required for hazardous materials
• Multi-language labeling may be required
• Seller liable for missing warnings

Product-Specific Requirements:

• Textiles: country of origin and fiber content
• Electronics: FCC markings, voltage ratings
• Food: ingredient lists, allergen warnings

12. Shipping & Incoterms

Incoterms 2020 Definitions:

EXW (Ex Works):

• Buyer arranges everything
• Seller places goods at facility

FCA (Free Carrier):

• Seller hands off to carrier
• Buyer pays freight and insurance

CPT (Carriage Paid To):

• Seller pays freight to destination
• Buyer pays insurance

CIP (Carriage & Insurance Paid):

• Seller pays freight and insurance
• Delivery at agreed point

DAP (Delivered at Place):

• Seller pays all freight
• Buyer clears customs and pays duties

DDP (Delivered Duty Paid):

• Seller pays everything
• Delivered to final destination
• Seller responsible for compliance

13. Shipping Documentation

Required Documents:

Bill of Lading (B/L):

• Contract of carriage
• Proof of shipment
• Negotiable or non-negotiable
• Original and copies required

Air Waybill:

• For air cargo
• Non-negotiable
• Issued by airline

Commercial Invoice:

• Seller’s invoice to buyer
• Basis for customs valuation
• Must be truthful and accurate

Packing List:

• Detailed package contents
• Weights and dimensions
• Item descriptions

Insurance Certificate:

• Proof of cargo insurance
• Required if CIP/CIF terms used

14. Customs Brokers & Agents

Authorized Brokers:

• Licensed by customs authorities
• Can file entries on your behalf
• Required for some shipments

Broker Responsibilities:

• Accurate documentation
• Timely filing
• Duty payment
• Compliance with regulations

Broker Selection:

• Verify licensing and reputation
• Understand fee structure
• Check experience with your products
• Ensure proper bonding

Upmos Role:

• May assist broker selection
• Provide documentation to brokers
• Does not guarantee broker performance
• Seller responsible for broker compliance

15. Customs Audits & Compliance Verification

Audit Triggers:

• Unusual trade patterns
• Valuation discrepancies
• Missing or incomplete documentation
• Seller history of violations
• Random compliance checks

Audit Process:

• Customs issues questionnaire
• Seller provides documentation
• Physical inspection possible
• Corrections and penalties assessed

Common Deficiencies:

• Misclassified products
• Undervalued shipments
• Missing certificates of origin
• Incorrect HS codes
• Prohibited items

Penalties:

• Duties and interest owed
• Liquidated damages (20%)
• Possible criminal prosecution
• Account suspension on Upmos

16. Anti-Dumping & Countervailing Duties

Anti-dumping duties are governed by 19 U.S.C. § 1673 et seq. and EU Regulation 2016/1036. Countervailing duties are governed by 19 U.S.C. § 1671 et seq. and EU Regulation 2016/1037.

Anti-Dumping (AD):

• Applies when goods sold below fair value
• Imposed by importing country
• Based on investigation of pricing
• Can be 10-500%+ additional duty

Countervailing Duties (CVD):

• Responds to export subsidies
• Imposed by importing country
• Applied to government-supported products

Affected Products:

• Steel and aluminum
• Agricultural products
• Chemicals and pharmaceuticals
• Electronics and machinery

Compliance:

• Research applicable AD/CVD orders
• Ensure competitive pricing
• Document pricing justification
• Consult with customs broker if targeted

17. Trade Compliance Program

Upmos Requirements:

Seller Training:

• Mandatory customs compliance training
• HS code classification basics
• Documentation requirements
• Prohibited goods identification

Audit & Monitoring:

• Regular compliance audits
• Documentation verification
• Corrective action plans for violations
• Performance metrics tracking

Escalation Process:

• First violation: warning and training
• Second violation: account restriction
• Third violation: account suspension
• Severe violations: immediate termination

Resources:

• Customs compliance guides
• Webinars and training materials
• Broker referral list
• Classification tools

18. Country-Specific Requirements

United States:

• ISF (Importer Security Filing) 24 hours pre-arrival
• Entry filed within 5 days of arrival
• CBP can demand samples/inspections

European Union:

• IOSS (Import One-Stop Shop) for non-EU sellers
• VAT calculated on total landed cost
• Customs Declaration required

Canada:

• Commercial Invoice in English or French
• BSF 186 customs clearance form
• Duties calculated at border

United Kingdom (Post-Brexit):

• Separate customs procedures from EU
• Additional documentation required
• Import/export licenses for some goods

Mexico:

• Pro-forma invoice requirements
• Pedimento (customs declaration)
• Trade agreement compliance verification

19. Documentation Retention

Record Keeping:

• Maintain all shipping documents
• Keep customs declarations 5-7 years
• Store commercial invoices and packing lists
• Preserve correspondence with customs

Digital Records:

• Scans acceptable if legible
• Metadata showing date/time
• Secure backup storage
• Easy retrieval for audits

Audit Preparation:

• Organize documents by shipment
• Index large volumes
• Identify potential issues proactively
• Consult broker or attorney if needed

20. Modifications To Policy

Updates:

We may update this policy as needed. Material changes will be communicated via:

• Email notification to sellers
• Prominent notice on seller dashboard
• Updated “Last Modified” date on this page

Continued Use:

Continued use of Upmos services constitutes acceptance of policy changes.

21. Contact Information & Related Policies

Trade Compliance Team

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