Duty optimisation in the international supply chain
Customs Duty Reduction
Go Supply Chain was engaged by the client, a global supplier of medical devices, for a review of customs duty paid in one element of their international supply chain
. The client is a major global manufacturer and supplier of medical devices, with sales exceeding $4bn annually. The company’s global supply chain strategy
leads to extensive international movements of components and finished products, in some cases incurring substantial customs duty costs. Further to initial discussions with Go Supply Chain, a project was planned to review the likelihood of reducing duty paid on a particular product line, which was being imported to North America from the European Union.
Research to identify customs duty reduction opportunities
We used a questionnaire to gather information from the client’s team on the current situation – for example what the product was being used for, what was the manufacturing process, where the product was being sold. Our research included reviewing WTO and global trade agreement texts, evaluating recent updates to USA-specific regulatory documents, obtaining (unofficial) legal opinion, utilising knowledge from earlier projects and consulting our own technical library.
Identifying opportunities for duty reduction and reclaim
We identified three potential opportunities to reduce customs duty payments for the specified product. One of these opportunities allows for the drawback of three years’ past duty payments. At the time of writing the client is beginning the process of making the reclaim.
Advising on future arrangements for duty minimisation
We suggested a range of best practice options to minimise, defer and / or eliminate duty payments for this product in future. Some of these options would also be applicable to the wider product range. Further to this we advised on coming changes to the trading / regulatory environment that may influence the duty payable in future.
“One of the opportunities identified allows for the drawback of three years’ past duty payments.”