Understanding Hts Code 98110060 For Importing Free Samples Into The United States

The importation of free samples into the United States is subject to specific regulations and classifications under the Harmonized Tariff Schedule (HTS). For businesses and individuals looking to import samples for promotional purposes, product testing, or soliciting orders, understanding the proper HTS code and associated requirements is essential. This article provides a comprehensive overview of HTS code 9811.00.60, which governs the importation of certain free samples, along with the requirements and options for importing commercial samples into the United States.

What Are HTS Codes and How Do They Work?

Harmonized System (HS) codes serve as a standardized numerical method of classifying traded products worldwide. Administered by the World Customs Organization (WCO) and updated every five years, the HS forms the foundation for import and export classification systems used by the United States and many other trading partners. The HS assigns specific six-digit codes for varying classifications and commodities, providing a universal language for trade documentation and customs processing.

The United States utilizes a 10-digit classification system for imported goods, known as the Harmonized Tariff System (HTS). While the first six digits align with the international HS codes, the United States adds four additional digits for more specific classification. This detailed classification system helps U.S. Customs and Border Protection (CBP) assess duties, gather trade statistics, and enforce regulations effectively.

For importers, understanding and correctly applying HTS codes is crucial for compliance, duty calculation, and smooth customs clearance. Misclassification can result in delays, additional costs, and potential penalties. The HTS code determines the applicable duty rates, any additional requirements, and the specific regulations that apply to the imported goods.

HTS Code 9811.00.60: The Specific Provision for Samples

HTS code 9811.00.60 provides a specific provision for importing certain types of samples into the United States duty-free. According to the official HTS description, this code covers "Any sample (except samples covered by heading 9811.00.20 or 9811.00.40), valued not over $1 each, or marked, torn, perforated or otherwise treated so that it is unsuitable for sale or for use otherwise than as a sample, to be used in the United States only for soliciting orders for products of foreign countries."

This classification applies to a wide range of product categories, including beauty products, baby care items, pet food samples, health products, food and beverage samples, and household goods. However, it specifically excludes alcohol samples (covered under 9811.00.20) and tobacco samples (covered under 9811.00.40).

The duty rate for samples classified under HTS 9811.00.60 is Free, meaning no import duties are owed when the sample meets all the requirements of this classification. This duty-free treatment makes it an attractive option for businesses looking to import samples for promotional purposes or to solicit orders.

Requirements for Importing Samples Under HTS 9811.00.60

To qualify for duty-free treatment under HTS 9811.00.60, samples must meet specific requirements related to their marking, value, and intended use. Understanding these requirements is essential for importers to ensure compliance and avoid potential issues at customs.

Marking and Defacing Requirements

Samples imported under HTS 9811.00.60 must be permanently marked as a "sample" or physically altered to render them unsuitable for sale. This can be achieved through cutting, tearing, perforating, or other visible treatments that clearly indicate the item is not intended for commercial sale. For textile products and footwear, additional marking and defacing requirements may apply, depending on the type of fabric, size, and other considerations.

The marking must be permanent and visible to customs officials upon inspection. Temporary markings or those that could be easily removed do not satisfy the requirements of this HTS classification. The purpose of these requirements is to ensure that samples cannot be sold or otherwise used for commercial purposes after importation.

Value Limitation

HTS 9811.00.60 applies only to samples valued at not over $1 each. This value limitation applies to the commercial value of the sample, not necessarily the price at which it might be sold. Importers must accurately declare the value of each sample on customs documentation, even if the samples are being provided to the importer at no cost or have no commercial value.

Commercial Documentation Requirements

Commercial documents accompanying the shipment must include a specific statement to ensure duty-free treatment: "mutilated samples – 9811.00.60". This statement alerts customs officials that the samples are being imported under the specific provision for samples and should be classified accordingly.

Additionally, commercial documents must show a value for the samples, even if they are being provided to the importer at no cost or have no commercial value. This value declaration is a requirement for customs processing and cannot be omitted, even for promotional samples with no actual market value.

Intended Use Requirements

Samples imported under HTS 9811.00.60 must be used exclusively in the United States for soliciting orders for products of foreign countries. This means the samples cannot be used for general marketing purposes, product testing beyond what is necessary for soliciting orders, or any other purpose not directly related to generating orders for foreign-produced goods.

After use, samples must typically be destroyed or donated to a charity or other non-commercial entities. Importers are not permitted to sell them or reconstitute them into articles that are suitable for sale. This restriction ensures that the duty-free treatment is not abused for commercial purposes beyond the intended purpose of soliciting orders.

Options for Importing Commercial Samples

Importers have several options when bringing commercial samples into the United States, each with different requirements, benefits, and restrictions. Understanding these options helps businesses choose the most appropriate method based on their specific needs and circumstances.

Option 1: Importing Under HTS 9811.00.60 (Duty-Free with Restrictions)

As described above, HTS 9811.00.60 allows for the duty-free importation of samples that meet specific marking, value, and use requirements. This option is most suitable for businesses that need to import small quantities of samples (each valued at $1 or less) for the purpose of soliciting orders.

The primary advantage of this option is the duty-free treatment, which reduces the overall cost of importing samples. However, the restrictions on marking, value, and post-import use may limit its applicability for certain types of samples or business needs.

Option 2: Regular Customs Entry (With Duties but Fewer Restrictions)

Importers can choose to import samples as a regular customs entry rather than using the specific sample provision. Under this approach, importers pay the applicable duties and taxes based on the HTS classification and duty rate for the specific products.

The primary advantage of this option is that the samples can remain in the United States indefinitely, and the importer retains the right to sell them after use. This makes it suitable for businesses that may want to use samples for multiple purposes beyond just soliciting orders or that may have samples with values exceeding $1 each.

However, the disadvantage is the potential cost of duties and taxes, which can make this option less economical for large quantities of samples, especially those with higher values.

Option 3: Entry Type 86 (Duty-Free for Low-Value Shipments)

For commercial samples valued at less than $800, importers may take advantage of entry type 86, which allows goods valued under this threshold to be imported free of duties, taxes, and fees. This entry type is available if the goods are not subject to antidumping, countervailing, quota restrictions, or additional fees or IRS taxes.

This option can be more flexible than HTS 9811.00.60 as it doesn't require the samples to be marked or defaced, and there are no restrictions on post-import use. However, the value limitation of $800 applies to the entire shipment, not individual items, which may not be suitable for very high-value samples or large quantities.

Option 4: Temporary Importation Under Bond (TIB)

For businesses importing samples to solicit sales or exhibit at trade shows, Temporary Importation Under Bond (TIB) may be an appropriate option. TIB temporarily permits the importation of goods into the United States free of duty when the importer posts a bond.

Goods imported under a TIB must not be sold or offered for sale and must be exported or destroyed within one year from the date of importation. Extensions can be requested for additional one-year periods, not exceeding three years total.

The advantage of TIB is that it allows for the duty-free importation of samples without the marking requirements of HTS 9811.00.60, and provides more time to use the samples for their intended purpose. However, there are additional risks associated with TIB entries, as failure to export or destroy the samples prior to the expiration date will result in liquidated damages equal to double the estimated duties for the samples.

Restrictions on Imported Samples

Regardless of the method used for importation, certain restrictions apply to imported samples that importers must be aware of to ensure compliance with U.S. customs regulations.

Post-Import Use Restrictions

Samples imported under HTS 9811.00.60 must be used exclusively for soliciting orders for products of foreign countries. After use, they must be destroyed or donated to a charity or other non-commercial entities. Importers are not permitted to sell them or reconstitute them into articles that are suitable for sale.

Similarly, goods imported under a carnet (which can include samples) cannot be sold. If such goods are sold, the importer would be required to pay not only the duties, fees, and and taxes on the goods but also a penalty equal to 10% of the duties and taxes owed for some or all of the sold goods.

Recordkeeping Requirements

Importers must maintain adequate records demonstrating the actual use of imported samples, particularly for those imported under specific provisions like HTS 9811.00.60 or prototype provisions. CBP may request proof of actual use within three years of importation for certain types of samples and prototypes.

Penalties for Non-Compliance

Failure to comply with the requirements for imported samples can result in significant penalties. These may include liquidated damages, additional duties, and potential seizure of the goods. For TIB entries, failure to export or destroy samples prior to the expiration date will result in liquidated damages equal to double the estimated duties for the samples.

Prototypes vs. Samples

It's important to distinguish between samples and prototypes, as they are subject to different HTS provisions and requirements. While samples are typically used for soliciting orders or demonstrating products, prototypes are used for development, testing, product evaluation, or quality control purposes.

Prototypes may be imported duty-free in limited non-commercial quantities under HTS 9817.85.01. This provision covers prototypes in varying production stages that are imported for development, testing, product evaluation, or quality control purposes. CBP may require importers to provide proof of actual use within three years of importation.

Sale of prototypes or any of their parts is typically restricted, though it may be permitted in certain scenarios as allowed by the U.S. Department of Treasury. Additionally, goods that are subject to quantitative restrictions, antidumping, or countervailing orders may not be imported under the prototype provisions.

Understanding the distinction between samples and prototypes is important for importers to ensure they are using the correct HTS provision and meeting all applicable requirements.

Considerations When Importing Commercial Samples

Before choosing an importing strategy for commercial samples, importers should consider several factors to determine the best option for their specific needs and circumstances:

1. Purpose of the samples: Are they being imported solely for soliciting orders, or will they be used for product development, testing, or other purposes?

2. Value of the samples: What is the total value of the shipment, and what is the value of individual items?

3. Quantity of samples: How many samples are being imported, and will they be imported all at once or over time?

4. Intended duration of use: How long will the samples be needed in the United States?

5. Post-import plans: Will the samples need to be retained after use, or will they be destroyed or donated?

6. Product type: Are there any specific requirements or restrictions applicable to the type of products being imported?

7. Compliance resources: Does the importer have the resources to ensure compliance with all applicable requirements and maintain necessary records?

By carefully considering these factors, importers can determine which importing strategy is most appropriate for their commercial samples and minimize the risk of non-compliance.

Conclusion

Understanding HTS code 9811.00.60 and the various options for importing commercial samples is essential for businesses that need to bring free samples into the United States. This specific provision allows for the duty-free importation of certain samples, provided they meet requirements related to marking, value, and intended use.

Importers have several options when bringing commercial samples into the United States, including importing under HTS 9811.00.60, using regular customs entry, taking advantage of entry type 86 for low-value shipments, or utilizing Temporary Importation Under Bond. Each option has different requirements, benefits, and restrictions, and the best choice depends on the specific needs and circumstances of the importer.

Regardless of the method chosen, importers must be aware of and comply with all applicable requirements, including marking and defacing requirements, value limitations, post-import use restrictions, and recordkeeping obligations. Failure to comply with these requirements can result in significant penalties, including additional duties, liquidated damages, and seizure of goods.

For businesses looking to import commercial samples, consulting with customs experts or trade compliance professionals can help ensure that all requirements are met and the most appropriate importing strategy is chosen. By understanding and properly applying the relevant HTS provisions and requirements, importers can bring their samples into the United States efficiently and cost-effectively.

Sources

1. HTS Code 9811.00.60 Details
2. Importing Commercial Samples Guide
3. Harmonized System HS Codes Overview