What Is an Importer of Record (IOR)?
Put simply, an IOR is a legal entity entrusted to move a shipment through customs while adhering to all compliance regulations and import restrictions. This entity is recorded on all entry documents and is liable should the shipment not comply with the destination country’s import laws and regulations.
An Exporter of Record (EOR) is similar and applies to getting gear out of a country. This also requires following stringent customs compliance requirements.
Responsibilities of the Importer of Record (IOR)
The IOR is entrusted with ensuring all legal requirements are met before the shipment can clear through customs. This entails making sure that the product classification is correct and that all imported goods have been accurately valued.
The IOR is responsible for the payment of duties, tariffs, and taxes and for completing all required compliance documentation and paperwork. Above all, the IOR is liable for the shipment and is subject to any risks associated with importing dual-use goods.
What an IOR Must Consider
The most common documents include:
- Product classification details the type and value of the imported goods.
- Import and export licenses – this is proof that you have permission to import or export goods.
- Import permits – specific documentation relating to your importing activities.
- Fees/Taxes/Duties – when paying associated fees, taxes, and duties, the associated paperwork needs to be filled out.
- Power of Attorney (POA) – documentation that appoints the entity to take on legal responsibilities, acting on behalf of the Importer of Record when they are not on site.
- Country-specific – each country has its own specific niche customs requirements and regulations. The IOR must have an up-to-date understanding of this in order to facilitate first-time customs clearance.
Who Can Act as an IOR?
When deciding who will act as the Importer of Record (IOR), it is essential to understand the role of the IOR. The IOR helps avoid confusion over who owns the goods during the import – this then feeds into who pays custom duties and taxes, as well as who assumes the import risk. During the time of import, the IOR is the temporary owner of the goods and takes on all the risk associated with that import process.
- Only a locally registered entity can act as the Importer of Record. They must have a physical presence in the destination country.
- Sometimes, the consignee can act as the IOR. However, for complex transactions, you need a licensed customs broker and an Importer of Record service partner.