Sample Scenarios

Here are some examples of how you can use Global Trade Management (GTM) to process declarations and trade transactions under different trade incentive programs.

Scenario 1: Bonded Warehouse

A Mexican company enters 10 units of bike frames in a Bonded Warehouse and later wants to exit 2 units from the Bonded Warehouse. The company would like to maintain the inventory against the Bonded Warehouse program.

• The sequence of customs declarations:
• Entry Declaration into bonded warehouse - 10 units.
• Definitive Exit Declaration from bonded warehouse - 2 units.
• Matching between entry and exit declarations is done at the item level.
• Matching occurs at the time of export.

Process Steps

Here are the steps to be followed:

1. Configure GTM as described in the topic Trade Incentive Program Configuration.
   
   Note: An important aspect is to identify the trade incentive program from a Mexican customs declaration. In this case, a combination of the following three fields will help in the identification:
   Operation Type
   Pedimento Code
   Regime
   
   So, a combination IMP-A4-DFI on a Mexican import declaration indicates that the imported products will go to a bonded warehouse.
   
   A combination EXP-G1-EXD on a Mexican export declaration indicates that the products leaving the bonded warehouse will be re-exported.
   
   Use attributes on the GTM declaration to map these fields on a Mexican customs declaration required to identify the trade incentive program. For example,
   "Operation" will be modeled as Declaration Type.
   "Regime" will be modeled as Declaration Sub Type.
   "Pedimento Code" will be modeled as Procedure.
   
   From each combination of Declaration Type, Declaration Sub Type, and Procedure GTM will determine the trade incentive program on a declaration.
   
   Note: For the bonded warehouse scenario, the item ID should be the same in the exit and the entry declarations.
2. Run the action Record Entries into Programs on the import declaration. This creates a Trade Incentive Program Inventory Movement record for the entry declaration with relevant information such as declaration line, item, inventory organization, quantity and balance quantity, etc.
   
   In this case, the Quantity field will display 10 units; and the Balance Quantity field will also display 10 units.
   
   GTM will also create a Trade Incentive Program Inventory Movement record for the entry declaration line.
3. Run the action Match Exits to Entries on the export declaration. This creates a Trade Incentive Program Inventory Movement record for the exit declaration with all the required information.
4. After matching the exit and entry declaration lines, GTM shows the new balance for the declaration line.
5. In this case, now the Quantity field will display 10 units (initial quantity); and the Balance Quantity field will display 8 units.

Scenario 2: Inward Processing

Vision Italy dispatches a combustion engine for repair to Vision UK in Great Britain. Once the engine is repaired, it must come back to Vision Italy.

The sequence of the customs declarations:

• Import Declaration into Inward Processing with item "Combustion Engine" and serial number "1328".
• Re-export Declaration – With one engine with serial number "1328".
• Matching between entry and exit declarations should be done at the item and serial number level.
• Matching and filing occur at the time of export.

Process Steps

Here are the steps to be followed:

1. Configure GTM as described in the topic Trade Incentive Program Configuration.
   
   Note: For Great Britain and the European Union, the Procedure Code mentioned in the customs declaration is used to identify the trade incentive program and whether a declaration is an entry or exit declaration for the program. For example, a procedure code of 51 on a customs declaration would enable GTM to identify a declaration and its products as entering the Inward Processing program. A procedure code of 31 on a customs declaration would enable GTM to identify a declaration and its products as exiting the Inward Processing program.
   
   Note: For this Inward Processing Repair scenario, the item ID and the serial number should remain the same between the exit and the entry declarations.
2. Run the action Record Entries into Programs on the import declaration with item as Combustion Engine, quantity as 1 unit, and serial number as 1823. This creates a Trade Incentive Program Inventory Movement record for the entry declaration.
   
   This also creates a Trade Incentive Program Inventory record for the entry declaration with the Quantity as 1 unit and the Balance Quantity field also displays 1 unit.
3. Run the action Match Exits to Entries on the export declaration with item as Combustion Engine, quantity as 1 unit, and serial number as 1823. This creates a Trade Incentive Program Inventory Movement record for the exit declaration with all the required information.
   
   After matching the exit and entry declaration lines, GTM shows the new balance for the declaration line.
   
   In this case, now the Quantity field will display 1 unit (initial quantity); and the Balance Quantity field will display 0 unit.

Scenario 3: Temporary Import under Bond

Vision Vehicle imports concept cars to the United States of America (USA) for purposes of demonstration. 

Matching is done at the serial number level. Matching and filing happen at the time of export on an individual basis.

On Jun 1st, 2022, Vision Vehicle imported 3 demonstration vehicles of the same make from Germany to the USA. They came in as 3 lines on one import declaration. The 3 demonstration vehicles shared the same item ID but each is tracked with its own serial number. 

The 3 demonstration vehicles went to different trade shows and were exported individually. The vehicle of Serial Number LN23-A99-02 was exported first. One export declaration was created in GTM.

Item ID: Concept vehicle 23-A99 

HS code: 98130035

Serial numbers: LN23-A99-01, LN23-A99-02, LN23-A99-03

Declaration Type	Date	Item	Serial Number	Quantity
US Import	6/1/2022
		Concept vehicle 23-A99	LN23-A99-01	1
		Concept vehicle 23-A99	LN23-A99-02	1
		Concept vehicle 23-A99	LN23-A99-03	1
US Export	9/1/2022	Concept vehicle 23-A99	LN23-A99-02	1

 

Process Steps

Here are the steps to be followed:

1. Configure GTM as described in the topic Trade Incentive Program Configuration.
   
   Note: The product-specific discharge periods defined under the Trade Incentive Program Rule will enable GTM to apply the appropriate discharge period for the given item.
2. Run the action Record Entries into Programs on the import declaration. This creates three Trade Incentive Program Inventory records from the entry declaration. 
   
   In this example, for each serial number, the Quantity field displays 1 unit, and the Balance Quantity field displays 1 unit.
3. Run the action Match Exits to Entries on the export declarations. GTM matches entry and exit declarations based on the period of discharge and serial number. 
   
   In this case, the inventory record of the item with serial number LN23-A99-02 is matched with the exit. Hence, for this item, the Entered Quantity field displays 1 unit, and the Balance Quantity field displays 0 unit.
   
   Since the other 2 vehicles (LN23-A99-01 and LN23-A99-03) still remain in the US, their Entered Quantity field displays 1 unit, and the Balance Quantity field also displays 1 unit.
   
   Trade Incentive Program Inventory:

   Item	Serial Number	Entered Quantity	Balance Quantity
   Concept vehicle 23-A99	LN23-A99-01	1	1
   Concept vehicle 23-A99	LN23-A99-02	1	0
   Concept vehicle 23-A99	LN23-A99-03	1	1

   
   
   Trade Incentive Program Inventory Movement:

   Item	Serial Number	Movement Date	Movement Type	Quantity
   Concept vehicle 23-A99	LN23-A99-01	6/1/2022	Receipt	1
   Concept vehicle 23-A99	LN23-A99-02	6/1/2022	Receipt	1
   Concept vehicle 23-A99	LN23-A99-03	6/1/2022	Receipt	1
   Concept vehicle 23-A99	LN23-A99-02	9/1/2022	Issue	1

   
    

Scenario 4: Unused Merchandise Drawback

Vision Hardware uses the US Duty Drawback on all their import and export items. There are 2 types of items:

1. Mineral sorting machines: There are 2 types of this machine – "stationary" and "portable" with HTS codes 8474.10.00.10 and 8474.10.00.90. Their 8-digit HTS codes are the same and hence, they are eligible for 8-digit level substitution matching. For example, 8474.10.00.10 and 8474.10.00.90 match interchangeably under 8474.10.00.
2. Power adapters: There are 2 types of power adapters:
   • 8504.40.70.01 – the 8-digit HTS code starts with "Other"; so, matching has to be at 10-digit level.
   • 8504.40.70.18 – the 10-digit HTS code also starts with "Other"; so, matching has to be at item ID level.

Here are the details of the program eligible items:

Item ID	Classification Code	Note
Power adapter-18-A	8504407018	Item level matching only. No substitution.
Power adapter-18-B	8504407018	Item level matching only. No substitution.
Power adapter-01-A	8504407001	10-digit level matching. Can be matched interchangeably.
Power adapter-01-B	8504407001
Power adapter-01-C	8504407001
Mineral sorting machine-portable	8474100010	8-digit level matching. Can be matched interchangeably.
Mineral sorting machine-stationary	8474100090

   

Process Steps

Configure GTM as described in the topic Trade Incentive Program Configuration.

Note: The product-specific discharge periods and matching constraints can be defined in the Trade Incentive Program Rule page. In this example, three Product Specific Rules can be configured – each rule corresponds to one matching constraint set (e.g., "8-DIGIT MATCHING", "10-DIGIT MATCHING", "ITEM ID MATCHING"). The system assigns each matching constraint set to the corresponding range of classification codes on the rule.

Case 1: Item ID Level Matching

Details of the items and the quantities imported and exported:

Declaration Type	Date	Item	Classification Code	Quantity
US Import	1/1/2020	Power adapter-18-A	8504407018	200
US Import	9/1/2022	Power adapter-18-A	8504407018	900
US Export	2/1/2023	Power adapter-18-A	8504407018	1000
US Export	2/1/2023	Power adapter-18-B	8504407018	5

 

1. Run the action Record Entries into Programs on the import declarations. In this case, two Trade Incentive Program Inventory records are created for "Power adapter-18-A", with Entered Quantity as 200 and 900, and Available Quantity of 200 and 900. So, the total quantity available is 1100.
2. Run the action Match Exits to Entries on the export declarations. GTM matches entry and exit declarations based on the item ID.
   
   Items with ID "Power adapter-18-A" are matched and the export quantity is deducted from multiple inventories of the same item. Hence, on the Trade Incentive Program Inventory page, the Available Quantity field now displays 100.
   
   Item with ID "Power adapter-18-B" is found as not a match.

Case 2: 10-Digit Classification Code Level Matching

Details of the items and the quantities imported and exported:

Declaration Type	Date	Item	Classification Code	Quantity
US Import	1/1/2020	Power adapter-18-A	8504407001	2000
US Import	9/1/2020	Power adapter-18-B	8504407001	1000
US Export	2/1/2023	Power adapter-18-C	8504407001	1500

 

1. Run the action Record Entries into Programs on the import declarations. In this case, two Trade Incentive Program Inventory records are created for two items both having the same 10-digit classification code "8504407001". One item has Item ID as "Power adapter-01-A", Entered Quantity as 2000, and Balance Quantity as 2000. The other item has Item ID as "Power adapter-01-B", Entered Quantity as 1000, and Balance Quantity as 1000.
2. Run the action Match Exits to Entries on the export declarations. GTM matches entry and exit declarations based on the 10-digit classification code "8504407001". In this case, exported item "Power adapter-01-C" (with quantity 1500) is matched with item "Power adapter-01-A" when Accounting Method is set to "First In First Out". On the Trade Incentive Program Inventory page, the Available Quantity field for item "Power adapter-01-A" now displays 500.
   
   Along with other information, the Trade Incentive Program Inventory Movement page displays:
    

   Item	Movement Type (Receipt/Issue)	Quantity
   Power adapter-01-C	Issue	1500
   Power adapter-01-B	Receipt	1000
   Power adapter-01-A	Receipt	2000

Case 3: 8-Digit Classification Code Level Matching

Details of the items and the quantities imported and exported:

Declaration Type	Date	Item	Classification Code	Quantity
US Import	1/1/2020	Mineral sorting machine-portable	8474100010	5
US Export	9/1/2020	Mineral sorting machine-stationary	8474100090	3

 

1. Run the action Record Entries into Programs on the import declaration. In this case, one Trade Incentive Program Inventory record is created for the item with classification code "8474100010". The Entered Quantity is 5, and Balance Quantity is 5.
2. Run the action Match Exits to Entries on the export declaration for the item with classification code "8474100090". GTM matches entry and exit declarations based on the first eight digits of the classification codes, i.e., match is based on the digits "84741000".
   
   In this case, exported item "Mineral sorting machine-stationary" (with quantity 3) is matched with item "Mineral sorting machine-portable". On the Trade Incentive Program Inventory page, the Available Quantity field for item "Mineral sorting machine-portable" now displays 2.