Answers to Frequently Asked Questions

What are Inco Terms?

Inco Terms, or International Commercial Terms, are a series of predefined commercial terms published by the International Chamber of Commerce (ICC) that relate to international commercial law. Inco Terms define which service costs within a door-to-door shipment are the responsibility of the buyer or seller.

Why use a freight forwarder?

Freight forwarders are non-asset-based service providers that assist with origin-point loading, transport, insurance and on-forwarding requirements for door-to-door cargo shipment solutions. Freight forwarders can offer customers discounted pricing based on their direct service contracts with ocean carriers, NVOCCs, air cargo carriers and trucking companies.

What is the advantage of using a customs broker?

A customs broker ensures that the importer is meeting the ever-changing requirements of CBP (Customs & Border Protection) including checking compliance, duty reductions, free-trade agreements and other duty-relief programs. A customs broker stays abreast of the growing rules and regulations of CBP and provides for timely delivery of imported goods.

Customs brokers have specialized knowledge of customs, which enables the importer to concentrate on its revenue-generating core competencies. Customs brokers also provide post-entry work — that may take the form of a refund request or other payment amendment requests — directly to CBP. Customs brokers can also provide shipping advice and the ability to monitor and track shipments.

What is a 3PL warehouse?

A 3PL warehouse allows customers to utilize the receiving, storage and distribution services of the 3PL provider. This gives a customer the flexibility to expand as the business change without incurring the costs associated with renting, maintaining and operating its own warehouse. A 3PL warehouse allows the customer to focus on growing its core business instead of the day-to-day handling of the product.

What is a Foreign-Trade Zone?

A foreign-trade zone (FTZ) is a designated location in the United States where companies can use special procedures that help encourage U.S. activity and value-added services — in competition with foreign alternatives. An FTZ allows delayed or reduced duty payments on foreign merchandise, as well as other savings.

A site that has been granted zone status may not be used for zone activity until the site has been separately approved for FTZ activation by local U.S. Customs and Border Protection (CBP) officials, and the zone activity remains under the supervision of CBP. FTZ sites and facilities remain within the jurisdiction of local, state or federal governments or agencies.


Why use a Foreign-Trade Zone?

The many benefits of using an FTZ include:

  • Duty Exemption – No duties or quota charges are imposed on re-exports.
  • Duty Deferral – Customs duties and federal excise tax are deferred on imports.
  • Inverted Tariff – Where FTZ production results in a finished product that has a lower duty rate than the rates on foreign inputs, the finished products may be entered at the duty rate that applies to its condition when it leaves the FTZ.
  • Logistical Benefits – Companies using FTZs may have access to streamlined customs procedures, such as “weekly entries” with associated financial benefits.
  • Other Benefits – Some foreign and domestic goods held for export may be exempt from state/local inventory taxes.