First Sale for Export (FSFE) is a duty reduction program designed to reduce the dutiable value of eligible products imported into the United States.
Normally when goods are imported into the US, duty is based on the value of the goods purchased by the Importer. This means that if there is a multi-tiered transaction where a Manufacturer sells to a Middleman who in turn marks up the price and sells the goods to the Importer, the Importer pays duty based on the higher value of the second sale which includes the Middleman’s profit.
First Sale for Export valuation establishes the dutiable value of the merchandise based on the ‘First Sale’ between the Manufacturer and the Middleman which excludes the Middleman’s markup thereby lowering the duties payable and resulting in what could be significant savings.
Who is a Candidate for First Sale?
Any importer bringing goods into the U.S. using a 'multi-tiered' transaction model may be eligible for First Sale valuation.
Previously First Sale for Export valuation was primarily utilized in industries such as apparel and footwear with high duty rates and high FOB volumes.
However, in today’s trade environment many companies who used to benefit from duty free status are now being severely impacted by the Section 301 duties on Chinese merchandise.
First Sale for Export valuation is an excellent way to help soften the blow, mitigate the additional duty impact and add to your bottom line.
Tradewin's Approach
Tradewin's valuation experts have prepared an integrated methodology designed to assure the proper application of this valuable duty reduction method. Our unique approach covers the full range of issues that have previously caused importers to shy away from First Sale for Export valuation. Our methodology includes a thorough review of the client's import activity to identify First Sale opportunities, an introduction of the program to our client's supply chain partners, and preparation of case studies specifically designed to address the importer's unique circumstances. This process is designed to meet all of CBP's stringent reasonable care requirements and specifically addresses the following FSFE criteria:
Requirements for First Sale for Export Valuation
- Arm’s Length transaction
- Clearly destined for Export to the US
- Bona Fide Sale for Export
- All Dutiable Cost Declared
Client Examples
Utilizing the First Sale for Export program, Tradewin has successfully recovered more than $100 million in duties spent for a well-known Fortune 500 apparel company. That number continues to grow as we steadily expand the program to include more eligible vendors. But, you don't have to have millions of dollars in imports to benefit from this program. Smaller importers can also save money with First Sale – just ask the importer who recovered over $395,000 in duties paid last year!
Please contact Tradewin to learn more. We are here to help.