AGOA 101 UGANDA. How To Export Duty-Free From Uganda To The U.S. Under The African Growth And Opportunity Act (AGOA)

Transcription

1 AGOA 101 UGANDA How To Export Duty-Free From Uganda To The U.S. Under The African Growth And Opportunity Act (AGOA)

2 Competitive AGOA Exports From Uganda To USA 2 AGOA 101 Uganda

3 What is AGOA? The African Growth and Opportunity Act (AGOA) is a United States Trade Act enacted on May 18, 2000 as Public Law 106 of the 200th Congress. On June 29, 2015, U.S. President Barack Obama signed the AGOA Trade Preferences Extension Act 2015 into law, extending the AGOA legislation by a further 10 years, to The legislation significantly enhances market access to the U.S. for qualifying sub-saharan African (SSA) countries. AGOA builds on existing U.S. trade programs by expanding the duty-free benefits previously available only under the Generalized System of Preferences (GSP) program. GSP is a trade program designed to promote economic growth in developing countries by providing preferential duty-free entry. AGOA combined with GSP, provides duty-free access to the U.S. for approximately 7,000 products. Why this guide? The USAID East Africa Trade and Investment Hub supports East African businesses to take advantage of AGOA. This guide outlines the step-by-step process that Ugandan businesses should take to export to the U.S. duty-free through AGOA. Exporting can be a challenging process, but it can also be profitable for the individual or company that manages to do it successfully. Exporters must follow two sets of requirements: 1.) The Ugandan laws and regulations that govern the export process, and 2.) The laws and regulations that govern the destination country s imports, in this case, the U.S. Regulations vary according to the product being exported; exporters must research to ensure that their product meets the necessary requirements for export. Exporters should identify the correct tariff code and its eligibility for duty free export under AGOA. This status can be established by referring to products.html and inserting the product name, searching for correct tariff code and confirming its AGOA AGOA 101 Uganda 3

4 status - denoted by letter D in the special tariff category column. Exporters should familiarize themselves with US industry standards and product-specific regulations which may require additional documentation and procedures. This guide assumes that the exporter or potential exporter has already conducted the necessary market research, and is ready to export. It highlights the process of exporting goods from Uganda to the U.S. under AGOA, with a focus on the following sectors: textile and apparel, floriculture, home décor and fashion accessories, footwear and specialty foods and products, including: Coffee Fish Casein Vanilla Dried Fruits Shea Butter A Ugandan AGOA exporter of Shea Butter products. AGOA Export Requirements Step 1: Business Registration The exporting entity must be registered. It is a statutory requirement that every business operating in Uganda must be registered and/or fully incorporated. This registration is important for businesses and export-related transactions, and demonstrates credibility and legality of the entity. The business registration process in Uganda is managed by the Uganda Registration Services Bureau (URSB). The process is as follows: Make an application for reservation of a name. Upon payment of the required fee, the suggested name is subjected to a search in the Business Registry Database. Once the name passes the similarity, defensive, offensive, desirability test then it is reserved. Reservation is valid for 30 days. Submit all the documents for business registration with applications and receipts of payment of necessary fees. 4 AGOA 101 Uganda

5 Information on assessment or payment registration of the required fee is done at the Business Registry, found at the URSB offices; or, the client may use the self-assessment option on the Uganda Revenue Authority (URA) web portal. In most cases, this payment for registration is done at the bank. Present the documents for registration with the receipt, after which you can now obtain a certificate of incorporation/registration within working hours. Step 2: Prepare And Obtain Export Documents The following is a list of documents required for export transactions: Commercial Invoice Bill of Lading or Airway Bill Export Packing List Certificate of Origin or AGOA Certificate of Origin for textile and apparel (visa) (annex) Commercial Invoice A commercial invoice is the bill for the products from seller to buyer. It is required for most imports into the United States. The buyer needs the invoice to prove ownership and arrange payment. It may also be used for transactions such as goods not intended for further sale, returned products and goods intended only for temporary import among other purposes. The invoice must contain the following: Complete name and address of the buyer or importer, seller or manufacturer and the shipper; Detailed description of the products with quantities, and the Harmonized System (HS) codes of the goods; Total value per item; The country of origin, with reason for export; and A statement certifying that the invoice is true, and a signature. Bill of Lading or Airway Bill: This is a contract between the owner of the products and the carrier. They are two types, namely: 1. A straight bill of lading, which is non-negotiable, and 2. The negotiable/shipper s order bill of lading, which can be bought, sold, or traded while goods are in transit and is used for letter-of-credit transactions. The customer usually needs a copy of the bill of lading as proof of ownership to take possession of the goods. Export-Packing List An export-packing list specifies the material in each individual package and shows the individual net, legal, tare and gross weights in U.S. and metric values. The packing list is normally attached to the outside of the package in a clearly marked waterproof envelope. It is a useful document for customs officials who use it to check consignments at inspection points. Certificate of Origin The Certificate of Origin (CoO) is a document indicating the country of origin for products being imported. It is usually issued by exporting countries, official authorities or by other agencies designated by the governments AGOA 101 Uganda 5

6 where the products originate from. It is used to ensure that products originating in certain countries get the preferential treatment to which they are entitled. It includes information such as contact information for the importer, exporter and producer; the basis for which preferential treatment is claimed; and a description of the imported merchandise. Importers are required to have the certificate in their possession at the time of the claim and to provide it to Customs and Border Protection (CBP) officers upon request. In Uganda, the AGOA Certificate of Origin for Textiles and Apparel (Visa) issued by the Ministry of Trade, Industry and Cooperatives. The procedure is as follows: 1. First-time exporters are required to fill in an application/registration form; 2. Present the duly-filled-out form to Ministry of Trade, Industry and Cooperatives for assessment; 3. Once the product has been cleared, you will receive a certificate of origin to fill out. This is done at no cost; 4. Present the filled-out certificate to the designated signatories in the Ministry of Trade, Industry and Cooperatives for endorsement. AGOA Certificate of Origin for Textiles and Apparel (Visa) This is a visa arrangement that establishes documentary procedures for each shipment of AGOA-eligible textile and apparel products from a designated beneficiary sub-saharan African country to the U.S. Normally, the AGOA visa stamp is issued by official authorities designated by the governments where the products are originating from and is fixed on the commercial invoice. Its main purpose is to avoid transshipment of products from non-agoa eligible countries to the U.S. The Ministry of Trade, Industry and Cooperatives is required to verify that the products intended for export actually originate from Uganda. Guidelines for AGOA visa application and processing in Uganda are as highlighted below: 1. A firm visits or writes to the Ministry of Trade, Industry and Cooperatives expressing interest in exporting under AGOA; 2. The Ministry of Trade, Industry and Cooperatives representatives are then required to verify that the products intended for export do originate from Uganda. To do this, Ministry of Trade, Industry and Cooperatives representatives conduct firm visits. 3. On confirmation of origin of the products, the exporter is included in the list of exporters and becomes eligible for an AGOA visa stamp. 4. The exporter is then required to submit three documents (with four copies each) as part of the process to apply for the AGOA visa. The documents include: a. An AGOA visa certificate application form; b. An invoice with details of the exporter, the importer, the product quantities and values; c. A packing list indicating the specifics of the products to be exported. 5. If the documents are accurately filled, an AGOA visa stamp is issued to the exporter within a period of three days. Normally it is issued on the same day (24 hours). 6 AGOA 101 Uganda

7 The exporter then ships the products with the certificate and declares it to U.S Customs as duty-free under the AGOA. Note: The AGOA visa application process is free. An AGOA visa is valid for six months. An AGOA visa is issued for each consignment/invoice. If an exporter is shipping two different consignments using one invoice, the Ministry of Trade will issue one AGOA visa. If an exporter is shipping two different consignments using two different invoices, the Ministry of Trade will issue two AGOA Visas If an order or invoice changes, the exporter must apply for a new AGOA visa. Step 3: Export Logistics Sending products from one country to another involves many parties. Generally, finished products are delivered to the U.S. buyer s destination. In order to deliver to a U.S. buyer s warehouse, or to comply with certain shipping requirements, large exporters typically have logistics specialists to coordinate and track shipment. In most cases, exporters rely on international freight forwarders and agencies to perform these services. Some companies utilize the services of shippers associations. Other companies use express delivery or mail services. It is also possible for exporters to arrange their own shipping. In Uganda, most exporters do not carry out the logistics processes on their own; quite often they engage the services of international freight forwarders to perform these services for them. AGOA 101 Uganda 7

8 It is also important to note that export logistics may involve knowing the buyer s requirements, including specifications, quality levels, price, place and time of delivery, packaging, labeling, documentation and insurance requirements as part of a commercial transaction. Step 4: Declaration to Customs at U.S. Port of Entry If you are travel to the U.S with goods for sale or other commercial purposes, you must declare them to a Custom and Border Protection (CBP) officer. On arrival at the port of entry, you must complete the CBP Declaration Form 6059B. This form provides basic information about who you are and what you are taking into the United States. This form is normally provided on the plane for passengers to fill out and submit to CBP staff. Additional conditions governing the entry of products according to the United States International Trade webpage: Cut Flowers Cut flowers are admissible for importation into the United States. A cut flower includes the severed portion of a plant, the inflorescence and any attached plant parts, in a fresh state. In addition to the general import documentation described earlier, Phytosanitary Certificates is required: Phytosanitary Certificates are documents for specific plants or plant products issued by an official of an exporting country, or country of reexport, attesting to freedom from pests and admissibility into the destination country. But even when plants or plant products are accompanied by a Phytosanitary Certificate, the US Customs and Border Patrol (CBP) regulatory officials will still inspect the importations to confirm admissibility. Children s Footwear The Consumer Product Safety Improvement Act (CPSIA) enacted in 2008 regulates specific substances in children s products, including children s footwear. The CPSIA sets limits for lead content and phthalates in children s products. A children s product is defined as a consumer product designed or intended primarily for children 12 years or younger. With respect to children s footwear, Section 101(a) of the CPSIA restricts children s products, including children s footwear, and components of children s footwear, to a lead content limit. CPSIA Mandatory Third-Party Testing requires every manufacturer or importer of all consumer products that are subject to a consumer product safety rule enforced by the US Consumer Product Safety Commission is issued with a general certificate of conformity based on testing the product and stating that the product complies with the applicable standard, regulation, or ban. The certificate must accompany the product and be furnished to the retailer or distributor. Section 102 also requires the manufacturers or importers of children s products (products designed and intended primarily for children 12 years or younger) to certify that the products comply with all relevant product safety standards by issuing a children s product certificate supported by tests performed by a CPSC-accepted third-party testing laboratory that has been accredited. Food Products Under provisions of the U.S. law contained in the U.S. Federal Food, Drug and Cosmetic Act, importers of food products intended for introduction into U.S. interstate commerce are responsible for ensuring that the products are safe, sanitary, and labelled according to U.S. requirements. (All imported food is considered to 8 AGOA 101 Uganda

9 be interstate commerce). Thus, exporters must meet requirements of U.S. food regulations that includes food facility registration, U.S. import procedures and Prior Notice. If your buyer is a first-time importer of food products to the US, they may want to contract the services of a customs broker (entry filer). Customs brokers are the only persons authorized by the tariff laws of the United States to act as agents for importers in the transaction of their customs business. Customs brokers are private individuals or firms licensed by CBP to prepare and file the necessary customs entries, arrange for the payment of duties, take steps to effect the release of the goods in CBP custody, and otherwise represent their principals in customs matters. Other Requirements Textile Product Labels The Textile Fiber Products Identification Act (TPIA) requires that products have labels. A label is to be affixed to each textile product and/or its package or container in a secure manner The label shall be conspicuous and durable enough to remain attached to the product and it package throughout distribution, sale or resale and until sold and delivered to the ultimate consumer. The label shall contain the following information: the generic names and percentages by weight of the constituent fibers in the product the name under which the manufacturer or other responsible company does business, or in lieu thereof, the registered identification number (RN number) of such company The name of the country where the product was processed or manufactured AGOA 101 Uganda 9

10 Care Labelling The Federal Trade Commission (FTC) enforces the Care Labelling rule, requiring manufacturers and importers or any person or organization that directs or controls the manufacturing of textile wearing apparel and pieces goods sold to consumers for making piece goods sold to consumer for wearing apparel to attach care instructions to garments. Goods exempt from this requirement include shoes, gloves, hats, handkerchiefs, belts, suspenders, neckties and non-woven garments made of one-time use. Useful Resources East Africa Trade and Investment Hub Ministry of Trade, Industry and Co-operatives Farmers House 3rd Foor Plot 6-8 Parliament Avenue P.o.Box 7103 Kampala, Uganda Tel: AGOA Country Response Office 9th Floor, South Wing Workers House Tel; , Uganda Revenue Authority Crested Towers 8th Floor P.o.Box 7279 Kampala, Uganda Tel: Uganda Registration Services Bureau 10 AGOA 101 Uganda

11 Uganda Revenue Authority Federal Trade Commission- textile label guidelines AGOA US Customs and Border Protection Tralac Trade Law Centre United States Consumer Product Safety Commission United States International Trade Commission - Harmonized Tariff Schedule Federal Trade Commission - Textile Label Guidelines Annexes Sample Commercial Invoice Sample Certificate of Origin Form Sample AGOA Textile Certificate of Origin Form Sample US Customs Entry Form 7501 AGOA 101 Uganda 11

12 SAMPLE COMMERCIAL INVOICE 12 AGOA 101 Uganda

13 SAMPLE CERTIFICATE OF ORIGIN FORM AGOA 101 Uganda 13

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15 SAMPLE AGOA TEXTILE CERTIFICATE OF ORIGIN FORM AGOA 101 Uganda 15

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17 SAMPLE US CUSTOMS ENTRY FORM 7501 AGOA 101 Uganda 17

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19 About the USAID East Africa Trade and Investment Hub The USAID East Africa Trade and Investment Hub works to boost trade and investment with and within East Africa. The goal of the Hub is to deepen regional integration, increase the competitiveness of select regional agriculture value chains, promote two-way trade with the U.S. under the African Growth and Opportunity Act (AGOA) and facilitate investment and technology that drives trade growth intraregionally and to global markets. Our main focus is on the East African Community countries - Kenya, Rwanda, Tanzania and Uganda. We also provide AGOA-related support in Ethiopia, Madagascar and Mauritius. The USAID East Africa Trade and Investment Hub is a proud component of two U.S. presidential initiatives, Trade Africa and Feed the Future. Contact: The East Africa Trade and Investment Hub Goodman Tower, Westlands. P.O. Box Nairobi, Kenya. T: +254 (0) E: info@eatradehub.org Andrew Kaggwa Country Representative - Uganda The East Africa Trade and Investment Hub T: +256 (0) E: AGOA 101 Uganda 19

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