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HAVE YOU
EVER BEEN HELD UP AT CUSTOMS?
 Are long
procedures wasting your time
and money? Look no more! The
ATA Carnet unlocks Customs
mysteries.
Created by
an international convention
over 30 years ago to promote
world trade, the ATA Carnet is
a global customs document that
facilitates the duty-free,
tax-free and hassle-free
temporary entry of goods into
foreign countries. Commercial
samples, professional
equipment (including tools of
the trade) and trade show
apparatus can be imported
under a Carnet for up to a
year without paying duties and
taxes. Merchandise covered by
a Carnet, that is sold or left
in the foreign country longer
than one year is then
subjected to applicable import
charges.
Temporary importation
provisions are an important
tool for companies who want 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. In
general, companies have three
options when considering
temporary importation: ATA
Carnet, Temporary Importation
Under Bond (TIB) and duty
drawback. The ATA Carnet
system is the most
user-friendly and structured
system of temporary
importation; however, there
are a number of countries that
do not accept carnets. In
these countries, companies can
post TIBs or apply for a duty
drawback as an alternative
means to duty-free
importation. Please see
our companion article: Temporary
Entry Made Easy.
WHAT IS AN ATA CARNET?
A carnet (a.k.a.
"Merchandise
Passport") is a document
that facilitates the temporary
importation of products into
foreign countries by
eliminating tariffs and
value-added taxes (VAT) or the
posting of a security deposit
normally required at the time
of importation. Companies are
required only to present
carnet documentation to U.S.
Customs when leaving the
country and upon entry into
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. Carnets cover most
personal and professional
goods, including commercial
samples, professional
equipment and goods intended
for use at trade shows and
exhibitions. They do not cover
consumable or disposable
items.
To encourage world trade
and reduce trade barriers
created by different national
customs regulations, the World
Customs Organization adopted
the "Customs Convention
on the ATA Carnet for the
Temporary Admission of
Goods" in December 1961.
The initials 'ATA" are
from the French and English
words "Admission
Temporaire/Temporary
Admission."
The U.S. Council for
International Business (USCIB)
was appointed by the U.S.
Treasury Department to be the
sole issuer and guarantor of
ATA Carnets in the United
States. The USCIB's ATA Carnet
Internet home page at
www.atacarnet.com contains
information on how to apply
for and receive a carnet.
WHAT ARE THE BENEFITS OF A
CARNET?
With an ATA Carnet, U.S.
exporters enjoy the following
benefits:
WHAT MERCHANDISE IS
COVERED BY THE CARNET?
ATA Carnets
cover virtually all goods,
including commercial samples,
professional equipment and
goods for tradeshows and
exhibitions. Ordinary goods
such as computers, repair
tools, photography/video and
sound equipment, industrial
equipment, vehicles, apparel,
and jewelry, as well as
extraordinary items like human
skulls, Olympic horses and
philharmonic orchestras can
all be covered by the ATA
Carnet.
WHERE CAN I USE A CARNET?
The ATA Carnet is accepted
by fifty-eight countries and
twenty-seven territories
worldwide. For a complete list
of countries and territories
that accept carnets, contact
the USCIB at (800)ATA-2900, or
visit www.atacarnet.com.
HOW MUCH DOES A CARNET
COST?
The value of the shipment
and the type of application
determine carnet fees. For
paper or faxed applications,
fees vary between $120 and
$250, electronic application
fees are between $200 and
$250. Additional charges of
between $35 and $150 can be
added for expedited service.
Electronic applications
received before 4:00 PM
central time will be processed
within 24 hours at no
additional charge. A $50 fee
is charged on 24-hour service
for applications received
between 4:00 PM - 6:00 PM
central time. Contact a carnet
representative at (800)
ATA-2900 for more details and
advice on the most
cost-effective option for your
business.
WHAT ABOUT THE SECURITY
DEPOSIT?
As the
guaranteeing association, the
Council requires security
deposits, which are usually 40
percent of the total value of
the goods, to cover any
customs claim that might
result from a misused Carnet.
There are two options for
posting security deposits:
cash or surety bonds. Cash may
take the form of a certified
check or money order. Surety
bonds may be obtained through
the USClB or any of the 200
companies authorized by the
U.S. Treasury Department and
admitted in New York State.
Once the Carnet has returned
to headquarters and has been
determined that it was
properly used, cash deposits
are refunded and surety bonds
are cancelled.
HOW LONG DOES IT TAKE TO
PROCESS A CARNET?
It usually takes five
business days to process a
carnet application. Same-day
pick-up and delivery is also
available for an extra charge.
All electronic applications,
however, can be processed by
the following day for no
additional charge.
GET YOUR CARNET IN 24 HRS
The online Carnet
application process, available
at http://www.merchandisepassport.org,
is quick and easy, resulting
in a Carnet being in the
exporter's hands within 24
hrs.
WHAT IF I LOSE MY CARNET
DOCUMENTS?
The USCIB offers insurance
for lost, stolen, or destroyed
carnet forms for a fee of
$12.50. The USCIB will issue
an immediate replacement to
customers with this insurance.
Full terms and conditions of
carnet insurance are available
when submitting an application
electronically, or by
contacting an ATA Carnet
representative for details.
IF A COUNTRY DOES NOT
ACCEPT CARNETS, WHAT ARE MY
ALTERNATIVES?
For countries that do not
accept carnets, companies can
apply for a Temporary
Importation Under Bond (TIB),
documents which can be
purchased from a customs
broker at the time of entry
TIB deposits and payments are
usually made in cash in the
currency of the importing
country. TIBs must also be
posted each time a product is
imported. Fees for posting
TIBs vary across countries and
depend on the type of product
being imported. Companies
should expect that it might
take several months before the
cash deposits are refunded.
Another alternative to a
carnet is the duty drawback
for temporary imports, a
process whereby importers
register the goods at the time
of entry into a foreign
country and deposit the
applicable duties and taxes
with the importing country's
customs authority. Like TIBs,
the deposit and payment are
usually made in cash and in
the currency of the importing
country. At the time of
departure, the foreign customs
authority will inspect and
collect the appropriate
paperwork for the product.
Companies will receive a full
refund of the duties and taxes
posted under the duty drawback
in the future.
Companies should contact a
customs broker in the
importing country to post TIBs
or apply for a duty drawback.
A partial list of countries
that accept carnets can be
found in USCIB's website at http://www.atacarnet.com/ata-carnet-countries.htm
WHAT ARE MY OPTIONS FOR
TEMPORARY IMPORTATION UNDER
NAFTA?
Companies that need to send
temporary exports can take
advantage of special
provisions under the North
American Free Trade Agreement
(NAFTA) and avoid paying
duties and taxes. NAFTA
requires Canada, Mexico and
the United States to grant
duty-free temporary admission
to certain classes of goods
imported from another NAFTA
country. In addition, under
its service provisions, the
agreement provides "tools
of the trade"
arrangements that allow U.S.
companies to send their
service personnel, along with
their tools, to a NAFTA
country. The goods do not have
to originate in a NAFTA
country to qualify for
temporary entry provisions.
ATA Carnets are not
accepted in Mexico. In order
to facilitate and expedite
temporary importation into
Mexico, it is helpful to plan
ahead. Most temporary imports
require the services of a
Mexican customs broker and may
involve the posting of
temporary import bonds (TIBs).
The 15 percent Value Added Tax
(IVA) for Mexico does not
apply to temporary imports.
ATA Carnets are accepted in
Canada. However, most goods
are already traded duty-free
between the United States and
Canada, which makes carnets
less important than in other
countries. There are 57
categories of goods for which
Canada permits temporary entry
under a special schedule if
the exporter completes a
Temporary Admission Permit,
and, where required, a Canada
Customs Coding Form. Many
temporary imports fall into
one of these 57 categories and
can be imported duty-free.
Temporary imports must also be
classified under the
Harmonized Tariff System (HTS)
number associated with
temporary imports into Canada,
under Chapter 98.
HOW DO I APPLY FOR A
CARNET?
Application forms consist
of a general list of products
to be shipped and the ATA
Carnet application -- both are
available on the USCIB's
website or by contacting a
carnet representative.
To apply for an ATA Carnet,
follow these three basic
steps:
- Prepare a general list
of shipment products;
- Complete the ATA Carnet
applications; and
- Provide a security
deposit.
All carnet applicants must
furnish the USClB with a
security deposit, in the form
of cash or bond, which varies
according to the importing
country. The deposit acts as
collateral and will be drawn
upon to reimburse the USClB in
the event it incurs a
liability or loss in
connection with the carnet or
its use. Cash deposits are
returned in full and bonds are
terminated once the original
carnet has been returned and
no claims are anticipated by
the USClB.
The amount of the security
deposit is based on the total
value of the general list,
with a minimum security of 40
percent. Goods traveling to
Israel and the Republic of
Korea require a 100 percent
security deposit.
FOR MORE
INFORMATION: Contact Carnet
Headquarters at the
- U.S. Council for
International Business
- 1212 Avenue of the
Americas
- New York, NY 10036
- Tel: (212) 354-4480
- Fax: (212) 944-0012
- Email: aracarnet@uscib.org
- Internet: www.uscib.org
Applications are available
at many offices of the US
Commercial Service. For
further information, please
call Paul Litton at
734/487-0259 or email at Jennifer.Loffredo@mail.doc.gov.
Please read our companion
article: Temporary Entry Made Easy.
Date
Updated: March 27, 2007
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