Your Initial Importer is not your Importer of Record
Why so much confusion?
We often get that question, ”As our initial importer, could you also be our importer of record? ”
The short answer is no unless we have a financial interest in the transaction.
The FDA requires foreign manufacturers to make sure the importer is registered with them. Dawa Medical LLC has been registered with the FDA for 5 years.
However, an importer of record (IOR) is the entity or individual who is responsible for all entry documents required by Customs Border Protection. The IOR is also responsible for the product classification and payment of duties.
What are the risks when acting as the importer of record?
I. Audit risk – depending on the local laws and regulations, the IOR is open to be audited for any transactions, up to 7 years after the import is complete.
II. Financial risk – the audit can result in subsequent revaluations of the import. That could mean larger tax bills and penalties relating to the import.
III. Legal risk – non-compliance with import regulations could result in the loss of import licenses.
IV. Operational risk – improper importing procedures may result in the shipment being temporarily held or permanently seized by customs.