Export Declaration

Export declarations are pivotal in international trade, especially for small and medium-sized businesses (SMBs) exporting goods across borders. A comprehensive grasp of the export declaration process is essential to global traders, as a lack of familiarity with them can result in potential regulatory complications and unforeseen costs.

In this post, we’ll focus on export declarations, what they are, their significance in international trade, along with the practices adopted by the U.S. and Canada.

 

What is an Export Declaration?

An export declaration is a document providing details about a shipment of goods being sent from one country to another and submitted to the customs authority of the exporting country. It includes information such as the type and quantity of goods, value, origin, destination, and other details related to the export transaction. 

Export declarations often include assigning the correct HS/HTS codes, which help in identifying the type of goods being exported. This information is vital for enforcing trade policies, calculating tariffs, and preventing the illegal export of restricted or prohibited items. Accurate export declarations contribute to streamlined customs processes and clearance. They play a vital role in economic planning and trade statistics, helping governments make informed decisions, such as the value of exports for different commodities. Moreover, these reports are integral to supply chain visibility, allowing for better tracking and managing of goods as they move across borders.

While the specifics of export declaration systems may vary from one country to another, the underlying principle remains the same: facilitating international trade while ensuring compliance with national and international regulations. 

 

Who Needs to Fill an Export Declaration?

An export declaration is required for all international shipments and must be completed before shipping the goods. Understanding export declarations is essential for any SMB involved in international trade. They are not just a formality but a legal requirement that can have significant implications for any business. 

The exporter or their authorized agent is responsible for filling out the export declaration. This document is then submitted to the country’s customs authorities from which the goods are being exported.

 

Additional Considerations for Filing Export Declarations

The requirement for filing an export declaration can vary significantly from country to country and often depends on the value and nature of the exported goods. 

Here are a few examples from around the world:

  • United States: An Electronic Export Information (EEI) filing is required when the value of the commodity is over $2,500 or if the nature of goods requires an export license.
  • Canada: In  Canada, an export declaration is generally required for all goods valued at CAD 2,000 or more. The Canadian Export Reporting System (CERS) is the platform where exporters or their agents can file the required export declarations electronically.
  • European Union: In the EU, an export declaration is generally required for all goods leaving the customs territory, regardless of their value. However, some exceptions apply, such as for goods moving within the EU or to particular territories. The EU’s customs declaration system is harmonized across its member states, declaring exports through the Single Administrative Document (SAD).
  • Australia: Australia requires to declare exported goods valued over AUD 2,000 or that require special exporter licensing. The Australian Border Force provides a comprehensive guide on how to complete the export declaration.
  • United Kingdom: In the United Kingdom, an export declaration is generally required for all goods leaving the customs territory. However, simplified procedures are available for businesses that meet specific criteria, allowing them to declare shipments by entering them in their own records.

 

Export Declaration System in the United States

The export declaration serves as a control mechanism for exports and is a foundational document for official U.S. export statistics. It must be filed electronically, typically when the value of commodities under a specific classification exceeds a certain threshold or when an export license is required. The U.S. Census Bureau’s Foreign Trade Division oversees these documents, while platforms like AESDirect facilitate its electronic submission. 

Historically, the U.S. used the Shipper’s Export Declaration (SED), but it’s no longer in use.

 

The Canadian Export Declaration System

Canadian Export Declaration System Canada has its own system for reporting exports, known as the Canadian Export Reporting System (CERS). This web-based portal allows exporters to submit electronic export declarations and monthly reports. The CERS portal is secured and maintained by the Canada Border Services Agency (CBSA). Exporters or their service providers use CERS to transmit export information, ensuring compliance with Canadian trade regulations.

 

Frequently Asked Questions About Export Declarations 

 

What is the Role of Export Declaration in International Trade?

Export declarations play an important role in international trade by monitoring and regulating the export of goods across borders, ensuring compliance with international trade regulations, helping in the accurate calculation of tariffs and duties, helping to prevent unauthorized or illegal export of restricted items, and maintaining trade transparency.

 

When is an Export Declaration Typically Required? 

While regulations vary by country, an Export Declaration is generally required when the value of the exported goods exceeds a certain threshold or when the goods are sensitive or restricted. For instance, items with potential military applications or cultural significance might necessitate detailed declarations. Businesses must check specific country guidelines to ensure compliance.

 

When is the EEI Required to Be Filed?

In the United States, the Electronic Export Information (EEI) must be filed when the value of the commodities, classified under any single Schedule B number (HTS code), exceeds $2,500. Additionally, it’s mandatory for all shipments, irrespective of their value, that require an export license or are headed toward countries or end users restricted by the U.S. government. 

 

How Can Businesses Electronically File Their Export Declarations? 

Many countries have digitized their customs and trade processes, allowing businesses to submit their Export Declarations online. This electronic submission streamlines the export process, reduces paperwork, and ensures faster clearance at customs. In the United States, export declarations are submitted online through the Automated Export System (AES).

 

Are There Other Critical Documents Involved in the Export Process? 

Although the specific requirements and their roles might vary by country, apart from the Export Declaration, other critical documents play crucial roles in international trade. Generally, these will include the Pro Forma Invoice, Packing List, Bill of Lading (for sea freight), and Air Waybill (for air freight). Additional documents like certificates of origin, export licenses, or inspection certifications might be required depending on the nature of the goods and the destination country.

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