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IOR and ACP – Import to Japan

As we receive questions often what the difference between ACP and IOR, prepared this page to help you understand ACP and IOR.

What is IOR – Importer of Record

When you export goods to Japan, for import, there must be an Importer of Record (IOR) in place. The importer, in principle, shall be a Japanese resident person/entity who’s responsible for taxes, customs duties, and all the compliance issued regarding Japanese laws and regulations for the imported goods.

If you (non-resident shipper) already find an anyone/entity in Japan that can be the IOR, the importer can proceed the import procedures in Japan side. But please make sure the importer agrees to be the IOR, since as said, the IOR should be responsible for all the taxes and regulatory compliance.

When need an ACP – Attorney for Customs Procedure

If you (non-resident shipper) can’t find an anyone/entity in Japan that can act as IOR, you’ll need to act as a Non-Resident Importer. But, in this case you must appoint an Attorney for Customs Procedure.

In other words, you can import by yourself by appointing ACP, even if you don’t find any entity can be the IOR in Japan.

If you are looking for an entity as being IOR, ACP can be a solution! We provide the service as being ACP, on behalf of a non-resident clients we support by ensuring the import customs procedure.

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

 

Our ACP Service (Attorney for Customs Procedures)

Contact us

 

 

ACP qualification – Import to Japan

Any individuals or companies can be entitled to be an ACP under the Japan Customs Law. However, we highly recommend to appointing to the ACP service company who has capability to manage trade and customs issues under the Japan Customs Law.

Especially, please select an ACP who is familiar with Customs issues including Customs Valuation. Because, recently Japan Customs has been becoming strict on the value setting for Non-resident’s import.

In fact, recently, we observe many troubles due to the inappropriate setting of the Customs Value. In the worst case but often, the goods can not pass the clearance. In the end, Importers paid huge amount of detention fees and finally shipped back.

We,  as qualified Customs professionals, are supporting so as to appropriately import the goods to Japan.

 

We’re a reliable ACP service provider for Amazon FBA’s seller

In recent, we’ve been supporting many import projects of goods related to the Amazon-FBA program. If you are looking for a reliable ACP service provider, please let us know.  

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

Our ACP Service (Attorney for Customs Procedures)

Contact us

ACP application – Import to Japan

To officially appoint ACP, the designated application form “C7500” by Japan Customs shall be necessary to submit.

To which Customs Office it shall submit is, depending on the arrival port. If the import goods arrives on Narita or Haneda airport, there are covered by Tokyo Customs, so the application should be submitted to Tokyo Customs.

In addition to the designated application form “C7500”, the following information also need to submit :

  • Power of Attorney
  • Company Registry
  • The calculation method of Customs Valuation   see. NR’s Customs Valuation 
  • Explanatory materials regarding Company profile, Catalog of the import goods, business/logistic flow

When we support, ACP Japan prepares the explanatory materials for the Customs Valuation, pricing of Tax Base.

Please be careful…

Please be careful, in recent Japan Customs has been becoming more strict for ACP’s registration, since there are many cases (problem) are seen in terms of in-appropriate customs valuation setting.

Please carefully to select ACP, it shall be recommended to appoint an ACP, who is familiar with Customs issues especially including Customs Valuation perspective.

We’re a reliable ACP service provider for Amazon FBA’s seller

In recent, we’ve been supporting many import projects of goods related to the Amazon-FBA program. If you are looking for a reliable ACP service provider, please let us know.  

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

Our ACP Service (Attorney for Customs Procedures)

Contact us

 

ACP’s limitation – Import to Japan

ACP, is not capable to handle all kinds of goods.

If the goods are subject to specific regulations such as Food Sanitation Act, Act on Pharmaceuticals and Medical Devices, or PSE/PSC it shall not allow to import by appointing ACP.

The said regulations have a requirement for the importers should be a Japanese resident entity. On the other hand, if a non-resident entity uses ACP for their import, it means that the non-resident entity becomes an importer. For that reason, for particular products that are subject to the previously mentioned regulations, it does not allow to import by appointing ACP.

Therefore, we check the eligibility as a first step, to avoid any restrictions for the importing goods.

 

Japanese import related regulations

Let us introduce several websites regarding import related regulations, so that you can understand and follow the required compliance before shipping goods to Japan.

Overall

Foods

Medicines

Electrical appliances

Plants and their seeds

We’re a reliable ACP service provider for Amazon FBA’s seller

In recent, we’ve been supporting many import projects of goods related to the Amazon-FBA program. If you are looking for a reliable ACP service provider, please let us know.  

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

Our ACP Service (Attorney for Customs Procedures)

Contact us

 

Consumption Tax – Import to Japan

Consumption Tax

In case a non-resident entity imports by taking advantage of Attorney for Customs Procedure (ACP), the non-resident entity becomes an Importer in Japan. It means that the non-resident entity has to pay (1)Customs Duties and (2)Japanese Consumption Tax (JCT, Japanese VAT), when import.

With regards to the (1) Customs Duties, it is only required for the non-resident entity to make payment only, very simple.

Regarding the (2) Consumption Tax, the non-resident entity has to pay 10% of the value of goods when import. After import, if the non-resident entity sells goods to Customer in Japan, the non-resident entity receives Consumption Tax 10% of sales value from the Customer in Japan.

Tax Liability

In principle, the consumption tax the non-resident entity receives has to be paid to the national tax office. However, if you are a small business with less than 10 million yen in your sales in Japan (namely “taxable sales in the base period”), you may be exempt from the tax obligation.

How the Japanese New Invoice System affects?

The new invoice system for Japanese consumption tax will start October 2023.  To issue a qualified invoice, you need to be a taxable entity. Your Japanese customer can’t claim input tax credits unless the sellers to issue such qualified invoices.

However, if your customers are just consumers, not business entity, then it wouldn’t have to issue such qualified invoices, so in such cases you wouldn’t have to registrer as taxable entity, as long as your company is satisfying the requirements for exempt entity.

Tax Representative (Tax Agent)

On the other hand, there may be cases where the imported goods stored at inventory warehouse in Japan for a certain period of time after importation. And, the inventory period is long, in which case only the payment of import consumption tax occurs and the cash flow burden is large. In such case, you can submit a “taxable enterprise selection notification” to the tax office to become a taxable enterprise. In this way, you can receive a refund of the import consumption tax paid.

If the non-resident entity has tax liability or the entity selects as to be a taxable enterprise, then the non-resident entity has to appoint of Tax Representative(Tax Agent), apart from ACP.

We can support both ACP and Tax Representative as one stop service.

 


We’re a reliable ACP service provider for Amazon FBA’s seller

In recent, we’ve been supporting many import projects of goods related to the Amazon-FBA program. If you are looking for a reliable ACP service provider, please let us know.  

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

Our ACP Service (Attorney for Customs Procedures)

Contact us

 

Customs Valuation – Import to Japan

Customs Valuation

Primary determination method

First of all, “Customs Valuation” refers to the method of determining the Import Declaration Value of imported goods.
As a general rule, if the import is made based on the “Import Transaction”※1 between an overseas seller and a buyer in Japan, in many cases we can use the primary determination method.

※1:”Import transaction” is a transaction that a buyer in Japan make a sale transaction with an overseas seller for shipping the goods to Japan, and the goods actually arrive in Japan.

Under the primary determination method, the Customs value of the imported goods is the transaction price paid by the buyer (CIF basis).

What you have to pay as Customs Duty and Consumption Tax, are calculated by multiplying this Customs Value by the tariff rate and consumption tax rate.

Exceptional determination method (e.g. when to use ACP)

On the other hand, if the non-resident company imports goods into Japan without having a sales transaction, you can’t use the primary method. You can’t simply use an Invoice Value.

It is required to apply the Exceptional Determination Method to calculate the Customs Value.

Regardless of whether an ACP or IOR service provider you use, if there is no buy/sell transaction, you should calculate the customs value based on the Exceptional determination method.

In the exceptional determination method, there are several methods you can consider using.

If you already imported goods that meets the identical or similar conditions of the import goods, you can use the “transaction value of identical or similar goods method”.

If you are able to identify the sales price and costs incurred in Japan, you can use the “domestic selling price method”.

If the exporter is a manufacturer and able to provide production costs, it may be possible to use the production cost method.

If any of the methods cannot be applied, lastly, we use “Other methods”.

In the practical scene, actually most of the cases we use this “Other methods” which is a determination method in a flexible way through considering the previously mentioned all the calculation methods.

 

Avoid any trouble caused by Customs Valuation issues

Recently, we observed many troubles due to the inappropriate setting of the Customs Value.

In the worst-case but often, the goods cannot pass the clearance. In the end, consignee paid a huge amounts of detention fees and finally shipped back.

We SK Advisory can help set an appropriate Customs Value. We can support having consultations with Japan Customs on behalf of clients, so as to avoid any problems occurring later on.

For Amazon’s FBA business, there is a recommended calculation formula of the declaration value. If you’d like to know about it, please feel free to contact us!

YouTube Video – Customs Valuation in Japan – How to calculate import declaration value, how much for import taxes

 

References


Japan Customs – Customs Valuation System in Japan


 

Amazon, in seller central website released the guideline of Customs Valuation.

Main Trade Procedures and Customs Valuation (English)

Main Trade Procedures and Customs Valuation (Chinese)

Main Trade Procedures and Customs Valuation (Japanese)

 


We’re a reliable ACP service provider for Amazon FBA’s seller

In recent, we’ve been supporting many import projects of goods related to the Amazon-FBA program. If you are looking for a reliable ACP service provider, please let us know.  

Guidance by Amazon

According to the seller central website in Amazon, there is a guidance by Amazon that non-resident entity needs to appoint an ACP or IOR. You may check on this “Non-resident requirements”. Also, you can check the document developed by Amazon “Understand ACP and IOR guidance”.   —–

 

Our ACP Service (Attorney for Customs Procedures)

Contact us