The stepping stone of importation business success - Power of Attorney
Updated: Jan 25, 2020
Lately, I have realized a very important lesson. Do not underestimate the powerful help from a professional. Whether it is real estate business transaction, e-commerce business, obtain life insurance OR importing goods to the United States, a handful people try to figure it out and DIY hoping to save some money to the middle man.
DIY a handcraft art would be a lot of fun but DIY those professional service, will not only cause you so much time and energy, but also a high risk of making mistakes. And mistakes are pretty expensive. Appointing a good custom broker is needed for your importation business success.
When you, an importer, contact a customs broker, we need to establish a legal connection so that we can work with CBP for you: Power of Attorney. Power of Attorney is a foremost important stepping stone to start your importation journey to work with a custom broker.
Essential elements in Power of Attorney
custom form 5291 is the standard power of attorney, but every brokerage firm will draft its POA document. All the form must include the following elements
Company EIN/ Tax ID# / IRS #。 You can easily find your EIN# on your tax return document or simply call the IRS. If you are importing as an individual, a social security number is needed.
The importer's business entity type, corporation, limited liability corporation, partnership, sole proprietorship, individual
The importer's business entity; s brick motor address on the public mapping program ( no PO Box or an undeveloped parcel of land )
The importer's business entity legal name, no trade or fictitious name allowed.
C-Level executives name and signature. Accept POA signatories includes Owner, president, Vice President, Corporate treasure, Corporate secretary, general counsel, CEO, CFO, COO, CIO, Chairman of the Board, Commissioned officer, Partner ( if LLC). Director, manager, and controller are not acceptable but common mistakes.
Use the DNB website below to verify.
Issue with Void EIN#
Occasionally, we find out the new clients' EIN is void by the time they reach us. This could be very troublesome because it generally takes 4 - 8 weeks to reactive EIN through U.S Custom. If the shipper has already booked the vessel through their forwarder overseas, it could be very bad because the consignee cannot be the importer of record in the bill of lading anymore. The shipper has to either cancel the booking or find alternative consignee to receive goods.
If you have not imported goods for very long time （ for example, 1+ year), please check with your custom broker to ensure your EIN# is all good and stay active. Reasons that EIN# being canceled could be
Inactive import history
CBP Has returned mail when attempting to contact importer of record through US postal office
Failure to respond CBP request
Reactive EIN# needs Valid POA + 5106 form + Docs from IRS within 12 month reflecting correct EIN number to be submitted to US CBP
A customs agreement for Power of Attorney is not a one to one binding relationship. You can have multiple custom broker at the same time. Last but not least, a power of attorney only authorizes the broker to work on your behalf with regards to customs business. Giving a customs broker POA does not give the broker any power within your business.
Hope this helps!