PARCEL International 2021

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may depend on satellite access, battery power, and potentially fallible human scanning. International returns have all the problems of domestic ones, and then you have to add in the paperwork and regulations involved in crossing borders. Cross-border commerce is subject to increasing inbound and outbound scrutiny, requiring more and more information. (The US has mandated increased inspection or certification of items on non-passenger flights.) This increase may again lead to privacy issues and to challenges for companies to store and document the information. Some countries have declined to provide all the AED information within the postal network because it is not required by a treaty or other inter-governmental agreement. Private carriers must meet the laws and requirements of both the sending country and the receiving country. This increased scrutiny has two effects. First, entry ports and customs officials have challenges with storage space and staffing, leading to delays. This will resolve itself as agencies and systems adjust to the new reality. Second, more scrutiny seems to be leading to more tax assessments and to more returns. Any country has the right to open any item for customs inspection and to re-value the contents. (Downward is unlikely.) With inspections of all items because of duties and taxes for any non-zero value, more

reassessments are likely. In EU countries, postal operators are charging fees for processing and delivery when customs duty and value-added tax (VAT) are due on an item. Consumers, unwilling to pay higher taxes and fees, are more likely to return items. The requirement by some EU countries that the EU Import One Stop Shop (IOSS) identification number appear on paper customs forms led to some fraudulent use of IOSS tax numbers. Companies should monitor their accounts carefully and be prepared to challenge fraudulent charges. Whether countries are motivated by protectionism, security, or revenue production, or some combination of them, matters as these regulations are enforced. The reasons behind and the objectives of these policies will dictate how strictly they will be enforced and whether there will be modifications easing or tightening them over time. Other Important Considerations Third-party logistic providers (3PLs) and other service providers can help mitigate the problems companies face with processing, paying, and tracking taxes. While 3PLs can provide assistance, the owner of the package has ultimate responsibility for the information provided to US and other government authorities — USPS, US Customs and Border Protection, foreign customs, and tax agencies — and can face legal sanctions for non-compliance. Carriers — express companies, airlines, shipping companies — face sanctions for non-compliance. (Postal operators are in a different situation because of treaties regulating them.) Accepting non-banked payments can also expose companies to legal problems. Banked payments are those that go through banks — credit cards, bank transfers, checks (or cheques), etc. Nonbanked payments do not use traditional banks and include payment processing companies (e.g., PayPal), cryptocurrencies, etc. The use of non-banked payment methods has been increasing for the last decade, particularly in less developed regions with less bank access and among those avoiding taxes, committing fraud, or laundering money. These types of payments will continue to increase, as will the increase in digital

currencies and the move away from cash. The legalities vary from country to country. A decision on whether to accept, or make, non-banked payments, and which ones, should be discussed with your firm’s accountants and attorneys. International commerce is subject to a number of multilateral treaties and agreements originating from international organizations. All has not been smooth lately: the World Trade Organization (WTO) has had no successful trade negotiations in about 20 years, and the Universal Postal Union remains unable to move forward on basic reforms. Trust between countries, especially the US as a reliable partner, has gone down over the last five years. While the international organizations have had some rocky years recently, the agreements affecting international package shipping, particularly the IATA regulations and customs agreements, will continue to be accepted and adhered to widely. Worldwide, with an overall vaccination rate of less than 20%, COVID will continue to be a problem into at least 2024 with continuing disruptions of transit and delivery. An increase in general restiveness, from demonstrations to increases in crime to coups d’état that have occurred recently worldwide, show little sign of decreasing, and may well increase due to continued dissatisfaction with COVID issues and economic troubles. The dependability of all those grids for electricity, for Wi-Fi, for telephone communications, and other services is increasingly fragile. Awareness of the issues and contingency planning are needed along with backups and security precautions.

Merry Law, President of WorldVu LLC, consults with organizations on international addressing and databases as well as on postal and delivery issues. She is editor of the authoritative Guide to Worldwide Postal-Code and Address Formats and author of Best Practices for International Mailings. Merry is a member U.S. International Postal and Delivery Services Federal Advisory Committee and the USPS Mailers Technical Advisory Committee (MTAC) and participates with the Universal Postal Union Addressing Work Group associations. INTERNATIONAL 2021  17