Valuation of Imported Samples

1. SAMPLES SOLD TO URBN

Shipments of samples, whether imported by mail or express courier, by hand, or by formal entry, must be handled in the same manner as usual commercial importations. That is, the full price paid or payable by URBN to the vendor should be declared on the commercial invoice (not an arbitrary or nominal “Customs” value), whether the samples are mutilated, duty-free, or otherwise. Like with production shipments, the vendor’s sales price should include all production costs, such as:

• Material costs
• Fabrication charges (materials, cutting, sewing, and mutilation costs)
• Development and Design costs (screen setup charges, embroidery set up charges, etc.)
• reasonable markup for general expenses and profit
  

The vendor and URBN should maintain proof of payment for each sample sold to URBN.

2. SAMPLES SUPPLIED FREE OF CHARGE TO URBN

If samples are shipped to the U.S. by a vendor free of charge to the importer, the samples should be invoiced either at: a. Cost of production, including:

• Material costs

• Fabrication charges (materials, cutting, sewing, and mutilation costs)

• Development and Design costs (screen setup charges, embroidery set up charges, etc.)

• reasonable markup for general expenses and profit

  b. Price equal to that used for similar or identical goods from the sample supplier and not at some arbitrary or nominal value.

The vendor should maintain documentation showing how the pro forma invoice price was calculated. The invoice should also state that the samples are being provided free of charge and that no payment will be made for the shipment.

All samples must be labeled with COO, fiber contents and RN#.

The FTC requires Country of Origin as well as fiber content and Manufacturer Identification/RN number information on textile apparel products including samples.

Please be advised that the FTC requirements will be met even if the required information (Country of Origin, fiber content, RN) is found on a hangtag attached to the garment rather than by sewn-in labels.

There are no exceptions! All vendors must comply with these legal requirements.

If you have any questions regarding the valuation of imported samples, please contact Brent Elliott, Senior Manager - Import Compliance (belliott@urbn.com )