By: Sean Kline
Determining who the USPPI is in an export transaction can be challenging at times. There are five different parties that can be the USPPI. Those parties include:
- U.S. Seller
- U.S. Manufacturer
- U.S. Order Party
- U.S. Customs Broker
- Foreign Entity
We receive numerous scenarios from the trade community who are trying to determine who the USPPI is in their transaction. Most cases are straightforward and easy to determine. However, there are some that make you think and maybe even have to draw a diagram. Below are some of those not so easy scenarios.
Scenario 1:
Boston Auto is a U.S. seller of vehicles and Car Traders is an online auctioneer, that auctions used automobiles. Car Traders directly negotiates the sale of an automobile between the foreign buyer and Boston Auto. Who is the USPPI?
Car Traders, the online auctioneer, would be the USPPI because they are acting in the capacity of an order party. However, if Boston Auto only posts the vehicle on Car Traders website, and Boston Auto negotiates directly with the buyer, Boston Auto is the USPPI.
Scenario 2:
An Italian company sells and sends goods to a U.S. company. The U.S. company refuses to take possession of the goods and the goods need to be returned to the Italian company. Who is the USPPI?
If the U.S. company is the importer of record, they are the USPPI. However, if the importer of record is a foreign entity, the USPPI will be the Customs Broker who cleared the goods on their behalf. Refer to the CF-7501 to determine who cleared the goods at the port of entry.
Scenario 3:
A tourist from Africa visits the U.S. and buys a necklace valued over $2,500 from Jewelry Depot. Who is the USPPI?
The tourist would be the USPPI because they were in the U.S. at the time the goods were purchased. They would provide their foreign passport number to a U.S. authorized agent in order for the agent to complete the AES filing.
For more information about the responsibilities of the USSPI please consult section 30.3 of the Foreign Trade Regulations.
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Scenario 3:
What if a person from another country (Africa, Europe, etc…) buys an item in the US valued over $2,500 via the internet. He then asks to have that item shipped to a Freight Forwarder in the US. The Forwarder would fill out the AES (after obtaining a POA from his client – the foreigner). Who would be the USPPI?
Thank you for your question Manuela. When determining who the USPPI is, it is important to know who is receiving the monetary or primary benefit from the export transaction. My understanding is that the freight forwarder in this case is completing the AES on behalf of the seller (after they give the freight forwarder a power of attorney). The U.S. seller is still the person or company who is receiving money from abroad to export the item. If that is the case, they are the USPPI.
Great blog and information on USPPI
Ryan, V.P.
If my company buy goods from US manufacture to supply a customer in UK who is the USPPI ?
If your company is located in the US it would be the USPPI since it is selling the goods to a foreign buyer. The transaction between your company and the US manufacturer is a domestic transaction that is outside the scope of the Foreign Trade Regulations.
We are a US manufacturer and have billed and shipped product to a US Distributor. They are consolidating these products in the US and are reshipping them to their sister company overseas. They are asking us to fill out the EEI-USPPI form for our products. Should we be the one to fill out this form?
It is considered a domestic transaction when you sell your goods to a US Distributor. As a result, you are not the USPPI and do not need to complete Electronic Export Information (EEI). It is the Distributor that sells the goods to a foreign buyer that would be listed as the USPPI and would be responsible for complying with the Foreign Trade Regulations.
We are a Canadian resident company. We do a trade show in the US, and write a number of orders for Central and South America. Most of these customers have their orders consolidated in the US, and are then exported to them. Who would be the USPPI? Neither the buyer or seller are residents of the US. Since the order was done in the US, could I as the seller be deemed the USPPI? I recognize shipping in bond, is the best way to go, but is not always feasible.
@Tim,
Great question! Because the buyer is physically here purchasing the order they would be considered the USPPI. They would use their foreign passport information when filing in AES. You can check out section 30.3(b)(2) of our regulations for more detailed information regarding the USPPI.
Our company manufactures products for an OEM. We drop ship our products directly to a company in France for inclusion into that company’s product. Who is the USPPI? Us as the manufacturer or the OEM as the company ordering the product for the french company?