Clarification Of Routed Export Transactions

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By: Justin Jenkins

Understandably, this concept of a routed transaction is risky and generates many questions. Let’s try to answer those questions and mitigate the risk.

The Dynamics of Routed Transactions shown with arrows and party names.

The Foreign Trade Regulations (FTR) defines a routed export transaction as, “an export transaction in which the foreign principal party in interest (FPPI) authorizes a U. S. agent to facilitate the export of a shipment from the U. S. and to prepare and file electronic export information (EEI).” Routed export transactions are a risk in that these transactions shift the control of the movement of the goods and the filing of the EEI from the U. S. Principal Party in Interest (USPPI) to the FPPI. The FPPI directs the movement of the goods out of the U. S. and authorizes the U. S. agent to file the Automated Export System record for the shipment. Though the FPPI is “controlling” the export transaction, the USPPI is still responsible for providing their name, address, and all the commodity information to the filing agent (see FTR section 30.3(e) for a detailed listing of the items).

To ensure that the EEI is filed accurately and to reduce your risk in this type of transaction, you should ask the FPPI to authorize you to file the EEI.

Key points about routed transactions:

  1. The FPPI controls the movement of the goods out of the U. S.
  2. The FPPI provides the authorization to a U. S. agent to prepare and file the EEI.
  3. The USPPI provides information to the U. S. agent regarding the shipment or can file the EEI, if they have received authorization from the FPPI.

Routed export transactions can be challenging, but if you adhere the key points discussed above, you will mitigate the risk involved in these transactions.

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37 Responses to Clarification Of Routed Export Transactions

  1. Carlos R. Maysonet says:

    What is the meaning of POA?

  2. Global Reach Justin says:

    POA is the acronym for Power of Attorney.

  3. Taylor C says:

    Per the above: “The Foreign Trade Regulations (FTR) defines a routed export transaction as, “an export transaction in which the foreign principal party in interest (FPPI) authorizes a U. S. agent to facilitate the export of a shipment from the U. S. and to prepare and file electronic export information (EEI).””
    My question is if in contract of sale the USPPI assumes the responsibilty of Export Clearance but not to facilitate the export would this still be defined as a routed transaction? Does the USPPI still need to obtain a POA from the FPPI to file the AES?

    • Janie Kuebler says:

      To anwer to your question. If the USPPI assumes the responsibility of export clerance, it is not an routed transaction.

  4. Global Reach Raemeka says:

    In a routed transaction, the FPPI is determining how the goods will be exported from the U.S. Therefore, if the transaction does not meet the definition of how the FTR defines a routed transaction, then the transaction will be considered a standard export transaction. The contract of sale does not determine if the transaction will be routed.
    Also, Per the FTR 30.3(e), Responsibilities of parties in a Routed Transaction, a POA or written authorization must be provided to the authorized agent or the USPPI to file the EEI from the FPPI. Therefore, yes, a POA must be provided to the USPPI from the FPPI to file the AES.

  5. Taylor C says:

    On the Census webpage there is an example for written authorization between the USPPI and an US Agent but not between an Agent and the FPPI or the USPPI and the FPPI. Is there another location that were an example can be found for these?

  6. Danielle R. says:

    Is it only routed if the shipment meets both criteria? : 1:FPPI controls movement 2:FPPI authorizes agent to file EEI
    For example: While we know sales terms don’t necessarily correlate whether it is routed or not, what do you make of this case: a shipment shipping under FCA terms, the USPPI would have responsibility for clearance while FPPI is controling the routing. Correct? Or is it routed because the FPPI is controlling the routing?
    To sum up, my question is, which determines whether it is routed: who controls the routing or who authorizes the EEI? Or do both need to be controlled by the FPPI before the shipment is considered for being a routed transaction?

  7. Steve says:

    It is understood that the USPPI will always be known as the shipper/exporter for obligations of the EEI filing in an Routed Export Transaction, however, is it also true that obligation of being shown as shipper/exporter does not exist for the USPPI when it comes to export documentation such as the ocean or air bill of lading ? In other words, the duly authorized US agent acting in behalf of the FPPI and who is facilitating the actual export should be indicated as the shipper/exporter, correct ?

    • Global Reach Sean says:

      The parties of the transaction do not change because it is a routed transaction. The USPPI is still the person or entity in the U.S. that receives the primary benefit from the transaction. For more information see section 30.3(b)(2) of the Foreign Trade Regulations.

  8. Javier says:

    I need to know Who is going to be the shipper / exporter in the field of the exporter in a routed export transaction?

  9. Jennifer says:

    If a foreign buyer consolidates freight from more than one US seller, AES must be filed for each USPPI, correct? If a USPPI requests proof of AES filing (for routed transactions) and is not given the proof and suspects the filings may be incorrect, what liability do they have?

  10. Global Reach Omari says:

    @ Jennifer
    Yes, you are correct. Based on your question, there would be multiple shipments if there are multiple US sellers, based on the definition of a shipment, one US seller shipping to one foreign consignee on one day, on one carrier. In a routed transaction, the US agent is required to provide a copy of data elements provided by the USPPI. It’s important for the USPPI to retain that documentation.

    If you are having trouble getting documentation from the US agent, make sure you contact the Regulations, Outreach and Education Branch on 800-549-0595 Opt. 3. They can assist you.

  11. Elizabeth says:

    We are the USPPI (a commercial EAR99 company), with a Korean customer. We have a shipment that is FOB, UNEX. UNEX is one of our vendors and is located in Korea as well. This shipment is considered a drop shipment from our vendor, however, our customer is going to arrange the pickup. Are we as the USPPI responsible for the Commercial Invoice and Packing List? Or just the Commercial Invoice?
    I keep going round and round on who should supply what document.

  12. Global Reach Omari says:

    @Elizabeth
    If the foreign party, the Korean customer is paying you for the product, then yes, you are the USPPI. However, the Foreign Trade Regulations do not govern the invoice or packing list related to the export transaction, only what’s reported in the AES. You may want to touch base with your local Customs office to get their advice as to which documents should be included with the shipment.

  13. Riau Daily Photo says:

    risks what happens if Routed Export Transaction is not done well

  14. Janie Kuebler says:

    why is so hard to get the POA from the freight forwarder? Most of the US agent dont even know what I am talking about?

  15. Alex Alarcon says:

    Would it still be considered a Routed Transaction if it’s an import into the USA? Given the USPPI would complete all shipping documentaiton for the shipper overseas.

    • Global Reach Daniel says:

      Hi Alex,

      In this case, I think the concept of Routed Export Transaction is being misinterpreted. A Routed Export Transaction is when the Foreign Principle Party in Interest (FPPI) authorizes a U.S. agent (such as a freight forwarder) to facilitate the export of items (not import) from the United States and to prepare and file the Electronic Export Information (EEI) to the Automated Export System (AES). If you have any other questions regarding Routed Export Transactions, please call 1-800-549-0595, option 3 or e-mail askregs@census.gov.

  16. JW Montgomery says:

    I am needing one simple clarification on this – if the FPPI has not legally authorized their Freight Forwarder/Agent in the U.S. to prepare and file AES via a POA then by definition I would NOT have a routed transaction, correct?

    This would just be an standard export transaction where the FPPI’s Freight Forwarder moves the freight out of the U.S. but not until the USPPI or its agent pepares and files AES and provides the necessary export documentation to the FPPI’s Freight Forwarder.

    • Andrew Harris says:

      @JW Montgomery / Omari Wooden,

      I also need clarification on this. If the FPPI has appointed a forwarder for shipment, I as the USPPI should ask for a copy of the POA granting that approval. If the forwarder does not have authorization within that POA (or none at all) am I then automatically authorized to complete the AES filing as the USPPI? Or are we both sitting ducks and can do nothing until that approval is granted by the FPPI? Furthermore, why does the USPPI need anyone’s permission to complete AES filing?….why doesn’t the regulation simply state that the USPPI may file if it so chooses in any situation? Why do we put that power in the FPPI’s hands? I just don’t understand why changes aren’t being made to alleviate confusion and work in favor of the USPPI to grant better control of export compliance from the US overall…

  17. Cedric Cita says:

    In the case of a routed transaction where the FPPI is buying goods from several US SELLERs , is it possible to enter several ITN numbers in one bill of lading if all the goods have the same destination / consignee ? This is assuming that the US SELLERS ( USPPI) are in agreement and that their respective agent file on behalf of the FPPI.

  18. Rick A says:

    I have a question with reference to the preparation of the documents for a ROUTED TRANSACTION.
    I already have the POA from the FPPI and the SLI from the USPPI need to prepare the ocean B/L.
    So, In order for the shipment to be consider a ROUTED TRANSACTION does the FPPI need to appear as the shipper on the B/L? Can a shipment be considered a ROUTED TRANSACTION if the USPPI is the Shipper and the B/L is consigned to the FPPI’s agent at destination?

  19. Marge stucke says:

    If The FPPI s forwarder files the AES on the shipment, how do we know if they we given the POA to do the filing , thus making it a routed shipment? Do we as the USPPI
    Have to request a copy of this from the forwarder? And if they weren’t given a POA, and still file the AES ..it is a non-routed transaction, is that correct?

    • Global Reach Daniel says:

      @Marge,

      Our Regulations, Outreach and Education Branch can assist you on this matter. I suggest contacting their call center at 1-800-549-0595, option 3.

  20. Vince Colgan says:

    In a routed transaction do I need to provide the US Agent with a Shippers Letter of Instruction? We do provide a commercial invoice which contains all the information needed for the AES filing. My interpretation is since the FPPI controls the shipment and has a POA with the US agent I should not have to provide an SLI.

  21. Global Reach Sean says:

    @Vince – Since this is a routed transaction and the foreign buyer has selected an authorized agent to file you are simply obligated to provide the applicable data elements listed in section 30.3(e) of the Foreign Trade Regulations.

  22. Traci says:

    Is it still considered a routed transaction if the FPPI is providing to us, the USPPI, an account number for the shipper of their choice? This means they are controlling the movement of goods, right?

  23. Mariano Gutman says:

    Can a US Authorized Agent give Logistic and Trading Services (purchase, sales, in bound transport and warehousing in behalf) to the FPPI against a trade/service fee, or it’s only for export purposes acting as a Freight Forwarder?

    • Global Reach Daniel says:

      @Mariano,
      The Foreign Trade Regulations do not regulate what an authorized agent can and cannot do outside the scope of their responsibilities related to filing export information in the Automated Export System.

  24. Jack Locastro says:

    Could I please have the answer to Daniel R’s blog on April 4.

    Quote – “Is it only routed if the shipment meets both criteria? : 1:FPPI controls movement 2:FPPI authorizes agent to file EEI
    For example: While we know sales terms don’t necessarily correlate whether it is routed or not, what do you make of this case: a shipment shipping under FCA terms, the USPPI would have responsibility for clearance while FPPI is controling the routing. Correct? Or is it routed because the FPPI is controlling the routing?
    To sum up, my question is, which determines whether it is routed: who controls the routing or who authorizes the EEI? Or do both need to be controlled by the FPPI before the shipment is considered for being a routed transaction?” – Unquote.

    The FPPI in this case, cannot be expected to accept civil and criminal penalties as described in the ‘written authorisation’ form in connection to electronically transmitted information when under FCA terms it is the scope / responsibility of the USPPI to execute the EEI function.

    • Global Reach Daniel says:

      @Jack,
      In a routed transaction, both must occur. The FPPI must facilitate the export and then authorize the USPPI or a U.S. agent to file the EEI. If the FPPI has not authorized a filer, however, that does not mean it is not a routed transaction. In that situation, the FPPI would have failed to meet their responsibilities and the goods could not be exported.

  25. KL says:

    In a routed transaction the FPPI authorizes the US agent to file the EEI and a POA must be on file between the FPPI and US agent and provide a copy to the USPPI upon request. Got that.

    What I am confused about is I am the USPPI and the US agent is going to be entering into the AES my EIN and the data elements I provide to them. Is there a requirement for a POA between the USPPI and the US agent since the agent is using MY EIN? According to the Census guidance, there isn’t a requirement. Perhaps I am missing something?

  26. Eager to comply! says:

    Question # 1 (Multiple EEI’s Permitted per conveyance?)
    15 CFR Part 30
    “Shipment.” All goods being sent from one USPPI to one consignee located in a single country of destination on a single conveyance and on the same day. Except as noted in §30.2(a)(1)(iv), the EEI shall be filed when the value of the goods is over $2,500 per Schedule B or HTSUSA commodity classification code.

    Question: We typically ship multiple container loads of goods on the same vessel which I am interpreting as the “single conveyance” noted in part 30 of 15 CFR. All of the container loads contain cargo value of greater than $2500 which then requires an EEI filing and all cargo is sold from the same USPPI and is destined for the same foreign Consignee/address. For file keeping purposes, it is easier for us to file separate EEI’s for each container rather than only filing 1 EEI for all of the containers moving on the same vessel. Is our current practice of multiple EEI”s per single vessel (conveyance) permissible?

    Number 2 (Routed vs. Non-Routed Shipment Definition When Exporting to Company owned Foreign Subsidiary)
    FTR section 30.3(e)
    (e) Responsibilities of parties in a routed export transaction. The Census Bureau recognizes “routed export transactions” as a subset of export transactions. A routed export transaction is a transaction in which the FPPI authorizes a U.S. agent to facilitate the export of items from the United States and to prepare and file EEI.

    Question: We export from our US based company (USPPI) to our foreign-wholely-owned subsidiaries around the world. Does the fact that the FPPI, in this case, our foreign subsidiaries who are the consignees, have any bearing on whether or not the shipment is “routed” vs. “non-routed”? We control the exporting logistics and arrange the bookings, etc.

    • Global Reach Daniel says:

      @goodmann33,
      To answer you first question, the information you provided suggests that you have ONE shipment so you would only need one ITN for all containers. As for your second question, the fact that the ultimate consignee is your foreign subsidiary does not dictate whether your shipment is routed or not. Routed export transactions occur when the Foreign Principal Party in Interest (FPPI) is controlling the movement of the goods to be exported out the U.S. In other words, the FPPI is selecting a specific carrier who will pick up the items for export and they are also authorizing an agent to complete the AES filing.

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