Falsifying Customs Documents at Buyer's Request

Because some countries assess a Value Added Tax or VAT on imported goods, a buyer located in these countries will occasionally request a seller falsify key fields of information on customs documentation so that their tax liability will be lessened. This is comparable to a U.S. citizen casually asking that his or her accountant monkey with individual amounts on Schedule A of their income tax form in order to illegally reduce the total amount they will owe.

A buyer might request an item be declared a ‘Gift’ rather than Merchandise, they may ask that a jewelry piece be described as 'costume' rather than declaring it to be made of precious stones or metals. Sometimes buyers may request that a seller enter a much lower price instead of actual item value (the price they paid). These actions can either drastically lower the VAT cost of the imported goods to the buyer, or completely eliminate any additional cost to them.

On occasion, too, buyers might ask that their purchase be declared to be something it is not. They may request that on a customs form a seller state their package contains another type of item entirely. When this occurs it is generally requested because an item they are purchasing abroad is something that is prohibited entry into their country, and they know it.

While sellers may view acceding to these not uncommon requests as a courtesy to the buyer, or maybe as just a way to help themselves secure the sale, in falsifying a customs declaration for a buyer you will be effectively skirting the laws of another country. In doing this a seller can set themselves up for several awkward possibilities, none of which are good. Consider these potential scenarios:

  1. The package is examined and a customs official decides the value claimed for its contents is inaccurate. If this happens, if goods that were deemed incorrectly declared are subsequently re-valued by a customs official, that person can assign any value they wish. This evaluation may well be very much more than the actual purchase price, resulting in a much higher customs charge. The buyer is then expected to pay that fee. If they decide they’d rather not, they may refuse to accept delivery. The returned item and all associated return delivery fees will then come back home to the sender.
  2. A customs official decides upon examination that an item is prohibited from importation. The shipment is seized and impounded and disappears into a warehouse full of such disallowed articles, never to be seen again. The buyer eventually expects reimbursement from the seller for the full amount originally paid. In this scenario, it is also possible the manner in which the seller completed the customs form can mean a buyer suddenly finds himself or herself in hot water. The following information was posted on an official British customs (HMRC) web page:
    Some unscrupulous overseas suppliers openly advertise on the Internet, or on their web-sites that they will deliberately either misdescribe items or under-declare their value in order to evade customs charges that are legally due on importation. You should be aware that although the foreign sender may have completed the customs declaration form on the parcel you are regarded (in law) as the importer of the goods and responsible for the information on the declaration, and any customs charges that may be due. This means that if you purchase goods from these suppliers and the declaration is found to be false or misleading you may be liable to financial penalties or criminal prosecution. Furthermore the goods themselves will be liable to forfeiture. It is in your own interests to ensure Customs declarations are completed properly.

  3. Buyer pays $250 for an item. At the buyer's request the shipper falsifies both the invoice they include in the package (to satisfy any customs search) and the Customs Declaration and Dispatch Note to claim item was sold for much less – say $25. The item is lost or damaged in shipping. An insurance claim with the USPS will require the sender’s copy of the Customs Declaration and Dispatch Note be submitted, as proof of mailing and proof of insurance. But that form was originally falsified to accommodate the customer’s request for a much lower value. The declared value is its insured value, too, as the USPS will not issue insurance for more than an item’s declared value.

So, in this scenario, the USPS would reimburse the shipper their actual declared value of only $25, even though the item really sold to the buyer for $250. Again, expect the buyer to seek reimbursement for the full amount they originally paid. The seller can protest but won’t have much ground on which to stand since they committed themselves to the lower ‘paid’ value when they falsified the official documentation. If the buyer used a credit card, too, they would certainly have no problem at all obtaining full value back from the seller via a chargeback for failure to deliver the merchandise.

If a buyer asks that you enter false information for their shipment, there is nothing wrong with politely informing them that all customs documentation will be completed accurately. Let them know this is for their protection, as well as your own. Many foreign buyers innocently ask for ‘gift’ considerations or lower values on forms only because friends or family have told them it is quite an acceptable request for them to make when buying on the Internet.

Prohibited Items
There are item specific considerations that may be unfamiliar territory for those who have never shipped internationally or for those who ship packages to another country on an infrequent basis. For instance, a shop owner sent the following comments to us:

***

I ran into a situation today that I hadn't really thought about before. A fellow in The Netherlands bought a very small (2" long)
pocket knife from me and when I went to the post office they told me that many country's customs will not accept anything that could
be considered a weapon. I ended up calling it a 'wood carving tool' on the customs form. Whether it goes through? We'll see. I wonder if this would apply to such items as letter openers, etc?

***

While realistically a two inch penknife would indeed seem to be more useful for whittling wood, rather than useful as a weapon, the accuracy (or purposeful inaccuracy) of disclosures made on customs forms concerning the contents of a package should not be related only to a sincere desire to ship the product.

To know in advance whether an item can legally be shipped into a particular country we recommend always checking for importation prohibitions and shipment restrictions before sending the package. Don’t expect a buyer to be any more knowledgeable about prohibited items than you or assume if it wasn't OK to send something to them they would not have placed the order for it.

The USPS Web site offers a page of links to all things pertaining to international shipments in their International Mail Manual. This would be a good page for U. S. based shops to bookmark for reference if they regularly ship internationally:

http://pe.usps.gov/text/imm/welcome.htm

Another good page to bookmark if frequently shipping abroad from the U.S.:

http://pe.usps.gov/text/imm/immctry.htm

Don't assume that the type of item you are shipping is innocuous, perfectly harmless, or simply so wonderful another country couldn't possibly want to keep it out. Prohibitions are usually placed to protect a country’s inhabitants or economic base. Shipping restrictions are often put in place for the protection of the shipper or the importer (your buyer), or both. Check before you assume that whatever you want to send is fine.

We offer from the USPS website types of prohibited items to illustrate samples of shipping restrictions by country, as of the date of this writing:

France

Under Prohibitions:

  • Imitation pearls containing lead salts and any articles of jewelry made with pearls of this type.
  • Cigarette lighters using butane gas
  • Measuring instruments marked in units not complying with French law.

Under Restrictions:

  • Gold coins or other articles of gold require that the addressee have a permit issued by the Bank of France (not required for gold-plated articles or for ornaments or jewelry containing only small amounts of gold and weighing 500 grams or less).

Great Britain and Northern Ireland (Includes England, Scotland, Wales, Northern Ireland, Guernsey, Jersey, Alderney, Sark, and the Isle of Man)

Under Prohibitions:

  • Cards decorated with mica or ground glass or similar materials unless they are placed in envelopes
  • Horror comics

Under Restrictions:

  • Coins; banknotes; currency notes (paper money); securities payable to bearer; traveler’s checks; manufactured and unmanufactured platinum, gold, silver; precious stones; jewelry; and other valuable articles, may only be sent in registered First-Class Mail International shipments or insured Priority Mail International parcels.

Italy

Under Prohibitions:

  • Albums of any kind (of photographs, postcards, postage stamps, etc.).
  • Articles of platinum or gold; jewelry; and other valuable articles unless sent as insured Priority Mail International parcels.
  • Bells and other musical instruments and parts thereof
  • Clocks and supplies for clocks.
  • Coral mounted in any way.
  • Footwear of any kind.
  • Haberdashery and sewn articles of any kind, including trimmings and lace; handkerchiefs; scarves; shawls, needlework including stockings and gloves; bonnets, caps, and hats of any kind.
  • Hair and articles made of hair.
  • Leather goods.
  • Lighters and their parts, including lighter flints.
  • Perfumery goods of all kinds (except soap).
  • Playing cards of any kind.
  • Toys not made wholly of wood.

Under Restrictions:

  • Coins; bank notes; currency notes (paper money); traveler’s checks; jewelry; and other precious or valuable articles must be enclosed in an insured Priority Mail International parcel in order to be mailable to addressees in Italy.
  • Postage stamps for philatelic purposes are admitted in registered First-Class Mail International shipments on condition that the package bears a completed Form 2976 and the addressee complies with the Italian financial regulations.

Some countries also have expectations in regard to ‘gift’ shipments. For example:

Czech Republic

Gift shipments must be sent by private individuals. Those sent by commercial firms are not admitted. Import permits are required for gift shipments exceeding three per year for one addressee, or for any shipment exceeding 3,000 Czech Republic crowns in value. Permits may be issued to addressees or withheld at the discretion of the customs authorities after the shipment arrives.

***

To prevent delivery delays, return of merchandise or seizure by Customs, we highly recommend reading the small print before entering false information on an official Customs document. For instance some official USPS forms will include this information:

Note: It is the sender’s responsibility to inquire and comply with the prescribed laws governing domestic and international mail and to find out what documents (invoices, certificate of origin, health certificates, etc.), if any, are required in the country of destination.

A section of the article, “Packing A Punch - Star Quality Shipping Tips” in the Managing Your Shop section of the Selling Successfully page offers additional guidance for packaging and sending International shipments.  (The Selling Successfully section of Ruby Lane is only available to Ruby Lane shop owners.)

Ruby Lane can’t do more than advise you on the process of filling out customs documentation papers, folks, but a word to the wise should be sufficient. And that word is ‘truth.’ You will, after all, be signing a customs declaration and that signed statement will stand later, should any shipping issues arise regarding that package.

Zenna Innis


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