In the world of international trade, understanding the implications of customs regulations is crucial for importers and exporters alike. A concept that often comes into play in this context is the General Order (GO).
What Is a General Order (GO)?
A General Order (GO) refers to the classification given to imported goods that are lacking the necessary documentation or face delays in clearance through customs. These delays can be due to various reasons, including:
- Incomplete or Incorrect Paperwork: If the owner of the goods fails to submit the required customs documents or provides incorrect invoices.
- Unpaid Duties Fees or Interest: Goods can be classified as GO if the associated duties or fees have not been settled.
- Failure to Claim the Goods: Merchants must claim their imported goods within a specified timeframe; failure to do so results in this classification.
Duration and Storage of General Order Goods
Goods classified as General Order remain in this status for no more than 15 days post-arrival. After this period, if the items remain unclaimed or improperly documented, they are moved to a Class 11 bonded warehouse. The Class 11 bonded warehouse is specifically designated for the storage of such merchandise under the authority outlined in the U.S. Code (Title 19, Section 1555).
It's essential to note that the transportation and storage risks of these goods remain with the importer. Therefore, it is in the best interest of the owner to resolve any issues promptly to avoid further complications.
Consequences of Extended General Order Status
If goods remain in General Order status for more than six months, they face more severe consequences:
- Confiscation: U.S. Customs and Border Protection (CBP) may seize the merchandise.
- Donation: Items might be given to charitable organizations.
- Auctioning: The goods can be auctioned to the public.
Auctions Organized by U.S. Customs
The auction process for general order merchandise is conducted by the CBP and typically occurs on a monthly basis. These auctions can be held online across the nation or at local public venues, such as hotels near ports.
- Participation: Auctions are open to anyone, with the exception of CBP employees and their immediate family members.
- Bidding Requirements: Interested bidders must place a $5,000 deposit to participate. Once purchased, these items are nonrefundable, and the buyer is responsible for arrangement and costs associated with the pickup of the merchandise.
Responsibilities of Ports and Companies
It is imperative that the port of entry or the company handling the imported goods adhere to the regulations set forth by the CBP. They are required to notify customs within 20 days of the imported goods’ arrival if the items are unclaimed or improperly documented. Failing to do so can result in fines of up to $1,000.
Real-World Example of a General Order
An illustrative instance of how these procedures unfold occurred in February 2017, when the CBP organized a nationwide online auction for general order merchandise that had been abandoned at ports. After remaining in the Class 11 bonded warehouse for six months, the goods became eligible for auction. The auctions typically include a diverse range of items, which may vary widely in value and type.
From electronics to luxury goods, these auctions provide an opportunity for buyers to acquire goods at potentially lower prices, while also enabling the government to recoup some losses from unclaimed merchandise.
Conclusion
Understanding General Orders is vital for importers looking to navigate the often-complex world of customs regulations. Being proactive about documentation and timely claim processes can prevent goods from being classified under this status, thereby safeguarding from potential loss and financial implications. If goods do fall into General Order, knowing the necessary steps for resolution can help mitigate the situation effectively.