International Legal Affairs: Volume 7, Number 1
International Shipping: Why Does Everything Cost So Much?
A recent call from a prospective client came in, and went something like this. “I’m in Canada, and I want to import a Remington 700. My dealer is charging $300 more than they charge in the States, and he’s ripping me off!. After gently trying to guide the client through the export process, it quickly became clear to the prospective client that the costs associated with exporting arms and moving them around the world is expensive and subject to seemingly random charges. What makes the movement of arms around the world so expensive?
When an item needs to move quickly, there’s no alternative to moving cargo shipments by air. It’s fast, convenient, and in our post-9/11 world, cargo doesn’t usually go missing or “fall off the truck.. On the downside, it’s expensive. Cargo rates vary by weight, dimension, value, and destination. Add fuel surcharges to account for fluctuating oil prices, and it can be very difficult to estimate the cost of a air shipment.
Client’s often ask – what will it cost to ship ______ to my location in ________. Given the inputs required to create a shipping quote, often it’s impossible to issue a quote until the shipment is in hand and ready to ship. As a general rule, air cargo will cost $8 – $12 per kilogram of weight. A single rifle in a gun case weighs no more than 10 kilograms, so the shipping can’t be any more than $120, right. Wrong. Security screening, filing the required documents with U.S. Customs, fees for couriers to deliver the required documents all add to the total invoice, often resulting in charges that exceed $500 to ship a single rifle. As shipments get bigger, the shipping invoice gets larger, but the dollar cost average per rifle goes down, making larger shipments more cost effective.
Other shipping options: USPS
Aren’t there other, cheaper options. Sure – the U.S. Postal Service comes to mind. International mailing rates are well known, and can be estimated with some accuracy, but shipping via USPS comes with its own risks. Often, clerks are ignorant of postal service guidelines and will refuse to accept the shipment. Gently educating them and referencing the USPS International Mailing Manual usually helps overcome those road blocks. Some countries do not allow firearms to be delivered by mail, eliminating the use of the U.S. Postal Service as a means of delivery.
Insurance is not required, but is highly recommended, adding to the cost of delivery. When a parcel is lost, postal service clerks will usually deny the insurance claim, asserting that international shipment of firearms are prohibited. Again, education overcomes these road blocks, but it can still take the postal service months to process the insurance paperwork. In the words of a colleague in the firearms industry, the sweet taste of a low price is often overcome by the bitterness of a
Other shipping options. Hand carrying cargo
Sometimes a prospective client will ask to ship a firearm in checked luggage on an international flight. The pitch usually goes something like this: apply for the export permit, meet the client at the airport, put the firearm in the checked luggage, and the client flies home. No fuss, the cost to ship is relatively inexpensive, and the client gets the firearm quickly. The problem. ATF has determined that this is an improper transfer, and cannot
be performed legally.
A copy of the ATF determination can be found online here: www.atf.gov/sites/default/files/assets/pdf-files/051613-open-letter-prohibited-transfers-of-firearms-to-foreign-purchasers.pdf
The rationale behind the ATF position is that the transfer takes place within the United States; a NICS check and Form 4473 must be filled out for all transfers made by a firearm dealer. As a foreign person cannot usually pass a NICS check or satisfy the requirements to take possession of a firearm, the proposed process does not meet the minimum requirements of the law. If the flight were to be cancelled and luggage returned to the passengers, the prospective buyer would illegally possess a firearm, and the dealer would have improperly transferred the firearm.
Shipping firearms and accessories from the United States by truck is generally only viable to Canada. While it would seem to be a cost effective means of transport, this mode of transportation has its own problems. Shipping less than a full truck load usually results in the shipment being moved on the trucking company’s time table. The cargo may move quickly, may sit until a trailer is filled, or may wait until there are sufficient trailers available to move the cargo.
Upon arriving at the Canadian border, expect Canadian Customs to fully inspect the shipment. There’s usually a fee for the inspection. There’s a minimum fee for fork lift service, to get the pallet of firearms off the truck. The fork lift may only spend 10 minutes on the job, but in at least one case, the minimum fee was for 4 hours of service, resulting in hundreds of dollars added to the cost of shipping. In other cases, clients have reported deliberate damage to firearms by Canadian Customs officials, in their “search” for contraband.
Finally, trans-continental shipments by truck can cost as much, if not more as air cargo. It may seem counterintuitive, but when all the costs and contingencies are added up, truck freight is often slower and as costly as air cargo when shipping
Shipping via ocean container is slow, but can be very cost effective, depending upon the volume being shipped. Shipping from the U.S. to Asia can be very cost effective, considering that most of the containers leaving the United States for Asia are empty. Ten standard U.S. pallets fit within a 20-foot container, providing excellent per unit costs for large shipments.
Shipping a single pallet via ocean cargo is not going to be cost effective; the shipping company is not going to consolidate a single pallet with other cargo. Shipping a handful of firearms via ocean cargo is not realistic or cost effective.
Idiosyncratic Country Policies
Local cultures play a massive role in shipping and the associated charges for moving firearms. When moving ammunition through Canada, Canadian officials will often require extensive paperwork to ensure that the requirements for shipping hazardous materials are met. Shipping firearms to the United Kingdom often involves armed escorts and 24-hour security. Recent changes in the law within China mandate that air cargo shipments of firearms be placed within their own LD3 air cargo container. If shipping a handful of firearms from China the minimum charge will be the equivalent of 350 kilograms, and run upwards of $4,500. Shipments to Taiwan from the airport to the end user, or in transit to an exposition require an armed police escort. All of these individual policies result in additional costs, time spent in transit, and knowledge to navigate unseen snares and pitfalls.
Exporting arms around the world can be quick, cost effective and efficient, but usually only two of the three attributes will apply at any given moment. When buying firearms and accessories that originate from outside your home country, one must be aware that there are many potential charges that go into the final retail price, and that the final cost may not be price gouging on the part of the retailer.
Mr. Wong is a Washington licensed attorney. He regularly provides legal counsel to the firearm and defense industry via his law firm, The Firearms Law Group. Mr. Wong also maintains Hurricane Butterfly, an import/export company that assists U.S. firearm manufacturers and foreign buyers wade through the regulatory morass of U.S. import/export regulations. He may be contacted via email at jmwong@FirearmsLawGroup.com.
The guidance provided within this article was correct and current at the time it was written. Policies and regulations change frequently. The preceding article is not intended as legal advice, and should not be taken as legal advice. If the reader has specific legal questions, seek competent legal counsel.