What is indirect representation and why use this service?

What is indirect representation?

An indirect representative is an entity that represents the importer and becomes jointly liable for the import formalities, including duties and taxes, at clearance. An increasing number of importers are being told that they need indirect representation to clear their goods.

When is an indirect representative required?

An indirect representative is typically required when the importer doesn’t have a physical presence in the destination country and at import, a registered local company is required to appear on the import documents. For example, a business based in the US is looking to sell its goods on Amazon France but has no registered business in France (or the EU). To import the goods, an indirect representative (with an EU entity) is required to clear the goods. 

Most freight companies are not happy to act in this capacity due to becoming jointly liable and will request an indirect representative, such as Fiscal IOR, to take on the responsibility. 

Indirect representation has been available for decades but has become far more prevalent since Brexit. For example, if you’re shipping goods from the UK to Germany, as the importer, there are three options available to clear the goods: 

1. The end client acts as the Importer of Record (IOR). This is the most straightforward approach, however, large marketplaces such as Amazon or third-party logistics companies will not act as the IOR. They don’t want to be accountable for the import duties or taxes nor appear on the import documents.
2. The importer sets up a subsidiary company in the EU to act as the IOR. This can be costly, time-consuming, and create further admin work for the shipper.
3. The importer finds an indirect representative, such as Fiscal IOR, to clear the goods.

Indirect representation from Fiscal IOR

Fiscal IOR provide a comprehensive indirect representation service that enables you to clear goods into the EU and UK. For us to act as your indirect representative, the following requirements must be met:

1. The shipper must have a valid EU EORI number linked to your business address
2. The shipper must have a valid VAT number for the destination country linked to its business address
3. Comply with due diligence and provide calculated guarantee/deposit as security
4. Have confirmation from the freight forwarder/shipping company that they can clear the goods with Fiscal IOR acting as your indirect representative

Our sister company Fiscal Solutions can assist with VAT and EORI registration as well as import vat reclaims.