Temporary exports

3 key takeaways

• Temporary exports involve sending goods abroad for a defined purpose and duration, with the expectation that the goods will be returned to the originating country.
• Common reasons for temporary exports include trade shows, repairs, exhibitions, and testing or demonstrations.
• Special customs procedures, such as the ATA Carnet, facilitate temporary exports by allowing duty-free and tax-free movement of goods across borders.

What are temporary exports?

Temporary exports refer to the process of sending goods from one country to another for a specific, short-term purpose, with the intention that the goods will be brought back to the original country within a predefined timeframe. This process is often used for goods that are not intended for sale or permanent use in the destination country but are needed temporarily for various reasons.

Common purposes for temporary exports

Temporary exports are used in various situations, including:

• Trade Shows and Exhibitions: Companies often export products temporarily to showcase them at international trade shows and exhibitions.
• Repairs and Maintenance: Goods may be sent abroad for repair, maintenance, or servicing and then returned to the original country.
• Testing and Demonstrations: Equipment or products might be exported temporarily for testing, evaluation, or demonstration purposes.
• Cultural and Sporting Events: Items such as musical instruments, art pieces, and sports equipment are often exported temporarily for events and performances.

Special customs procedures for temporary exports

To facilitate temporary exports, special customs procedures and documentation are available:

• ATA Carnet: The ATA Carnet is an international customs document that allows the temporary importation of goods without the payment of duties and taxes. It simplifies customs procedures and is accepted in many countries worldwide.
• Temporary Importation Bond (TIB): In some countries, a TIB can be used to cover the duty on temporarily imported goods, ensuring that they are re-exported within a specified period.
• Customs Declarations: Exporters must complete specific customs declarations for temporary exports, detailing the purpose, duration, and value of the goods.

Advantages of temporary exports

Temporary exports offer several benefits:

• Cost Savings: By using procedures like the ATA Carnet, exporters can avoid paying import duties and taxes on goods that are not intended for permanent import.
• Simplified Processes: Special customs documentation and procedures streamline the process of moving goods temporarily across borders.
• Flexibility: Temporary exports allow businesses to showcase, test, or repair products in international markets without committing to permanent export.

Example of temporary exports in practice

Consider a technology company that wants to showcase its latest products at an international trade show:

1. Preparation: The company prepares the necessary documentation, including an ATA Carnet, listing all products to be temporarily exported.
2. Customs Procedures: The goods are shipped to the destination country, where customs officials validate the ATA Carnet, allowing duty-free entry.
3. Trade Show Participation: The company showcases its products at the trade show, attracting potential customers and partners.
4. Return Shipment: After the trade show, the goods are packed and shipped back to the original country. Upon re-entry, the customs officials validate the return of the goods using the ATA Carnet.

Example Calculation

Suppose the company temporarily exports products worth $100,000 for a trade show. By using the ATA Carnet, it avoids paying import duties and taxes, which could amount to 20% of the product value. This results in savings of $20,000 on import duties and taxes.

Managing temporary exports

Effective management of temporary exports involves:

• Accurate Documentation: Ensuring all necessary customs documents, such as the ATA Carnet or TIB, are accurately completed and submitted.
• Tracking and Monitoring: Keeping track of the goods throughout the export and re-import process to ensure timely return and compliance with customs regulations.
• Compliance with Regulations: Understanding and adhering to the specific customs requirements of the destination country to avoid delays and penalties.
• Insurance: Obtaining appropriate insurance coverage for goods during transit and while they are temporarily abroad.

Temporary exports are a valuable mechanism for businesses to move goods across borders for short-term purposes without incurring the costs and complexities associated with permanent exports. By utilizing special customs procedures and managing the process effectively, companies can take advantage of international opportunities while minimizing financial and logistical burdens.