HQ 115139 - Importer of Record; Intermediary Catalog Company; Agency Relationship; 19 U.S.C. §1484; 19 C.F.R. §141 et al. Dear Mr. Smiley: - United States International Trade Commision Rulings

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HQ 115139

December 19, 2000

ENT-1-01-RR:IT:EC 115139 LLO

CATEGORY: ENTRY

Robert E. Smiley
Chief Executive Officer
R.E. Smiley, Incorporated
2541 Old Dam Road
Goochland, Virginia 23063

RE: Importer of Record; Intermediary Catalog Company; Agency Relationship; 19 U.S.C. §1484; 19 C.F.R. §141 et al. Dear Mr. Smiley:

We received your letter requesting a ruling giving a definitive categorization of eTraderBob.com as either merchandiser or importer. The ruling on this issue follows.

FACTS:

R.E. Smiley, Inc. is creating a website (eTraderBob.com) by which Americans can view a catalog of products in foreign countries and purchase merchandise directly from sources in those countries. ETraderBob.com acts as a merchandiser only and never assumes ownership of the merchandise. The transactions are directly between consumer and foreign merchant and Customs treats those sales as an individual purchase of “household goods.”

ISSUE:

Whether intermediary catalog company is importer of goods on orders placed by purchasers directly with foreign supplier.

LAW AND ANALYSIS:

19 U.S.C. § 1484 provides that only parties qualified as the importer of record may make entry. 19 U.S.C. §1484(a)(2)(B) provides that parties qualified as an importer of record are the owner or purchaser of the merchandise or, when appropriately designated by the owner, purchaser or consignee of the merchandise, or a person holding a valid license under section 1641 (a licensed Customs broker).

ETraderBob.com is acting on behalf of foreign based companies in providing web services through displaying and making available the companys’ products by way of the internet to the American public. According to a sample contract included in the ruling request by R.E. Smiley, Inc., eTraderBob.com is only responsible for the following:

-assisting in the identification of any products it considers suitable to be featured on the website. -preparation of text and photos for the website. -designation of shipper foreign company is to use for shipping products to U.S. -resolution of internet problems by “liasing” with the relevant parties in attempting to resolve the problem. -assistance with settlement of problems dealing in returned merchandise on behalf of foreign company . -displaying products on website.
-notify foreign company of particulars of each order made.

For the above services that eTraderBob.com supplies the foreign based companies, it receives a commission for actual sales from its website. EtraderBob.com acts as an agent for foreign based companies when it displays products on a continuing contractual basis; does not take title to the imported merchandise; and has a financial interest in the imported merchandise by virtue of its commission earned for displaying the products on the internet on behalf of its foreign based clients along with its other duties outlined above.

The sample contract enclosed in the ruling request specifically labels eTraderBob.com as an “advertising agent” for its foreign clients. If the products purchased are arriving by regular mail delivery, the package will have affixed to the outside of it the necessary Declaration and invoices from the foreign shipper that will include information identifying the contents and providing a value. See,19 C.F.R. §145.11. If the cost of the products are under $200 in value, Customs waives duty and the merchandise is delivered to the purchaser. See, 19 C.F.R. §145.31. If the cost of products is valued over $200 but not more than $2000, the merchandise is entered informally and the Postal Service collects any duty, when the package is delivered to the purchaser. See, 19 C.F.R. §145.12(4)(b). If valued at over $2000, the individual will have to either formally enter the merchandise himself as the importer of record, or must appoint a licensed broker to make formal entry.

HOLDING:

R.E. Smiley, Inc. is not required to be the importer of record in the internet transactions that it assists its clients in acquiring. Since the merchandise in question will arrive by mail, the purchaser may formally enter the merchandise as the importer of record or appoint a licensed broker to make formal entry if informal entry is not an option pursuant to 19 C.F.R. §145. 12 (a)(2).

Sincerely,

Larry L. Burton
Chief

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