As of November 2023, reports from Trading Economics have stated that exports from Cambodia have increased to 8053.70 KHR Billion from their previous 7192.40 KHR Billion in October of the same year. Among the various goods that Cambodia exports, car parts are notably one of the top commodities. As per the Ministry of Commerce, Cambodia exported US$11.272 million worth of vehicle parts in the first quarter of 2023, which is an increase of 43.52% compared to last year.
In an interview with the Phnom Penh Post on May 3, Hong Vanak, the director of International Economics at the Royal Academy of Cambodia, informed The Post that the country's overall export capacity has seen significant growth. He attributed this success to appealing changes in the legal framework for investment, preferential tariff benefits from key markets, and a consistent increase in investment across various sectors.
One of Cambodia’s largest single-country export destinations is the United States, which approximately takes 40% of the country’s exports, as per the International Trade Administration. And while the USA is not particularly the major recipient of Cambodia’s motor vehicle export, there is still potential for car parts manufacturers to expand their market there.
To guide businesses on how to ship their car parts for sale internationally, particularly in the US, we give you insight into the regulatory requirements and documents necessary.
1. Regulatory Compliances For Exporting Car Parts From Cambodia to the US
Shipping car parts from Cambodia to the USA requires adherence to specific regulatory compliances to ensure a smooth process. These regulations and customs laws are critical to understanding for any car parts manufacturer in Cambodia looking to tap into the vast US market.
a. Regulations For Exporting Car Parts From Cambodia
According to the Cambodia National Trade Repository, car parts that will be exported from Cambodia must be officially declared. Additionally, duties and taxes must be paid on these items unless they qualify for an exemption or the duties and taxes are waived.
The declaration process involves electronically submitting a fully completed and signed Customs Declaration form, also referred to as the Single Administrative Document (SAD), via ASYCUDA World. A hard copy of the document must be submitted at the Customs clearance office. This must be accompanied by a minimum set of supporting documents, which include:
- A commercial invoice or a contract of sale document provided by the goods' supplier
- Transportation documents, like a Bill of Lading or a Way Bill
- A Packing List
- Original Purchase invoice
- Passport Copy.
- A copy of the passport must be true certified by the Government Agency
- ID Card Copy (For Cambodian only).
- Power of Attorney.
- Application Letter.
- Copy of Purchasing Invoice.
- Copy of Import Document.
Learn more about the customs clearance process in Cambodia.
b. Regulations For Importing Car Parts to the US
When importing car parts into the United States, compliance with the Environmental Protection Agency (EPA) and Department of Transportation (DOT) regulations is crucial.
With the Department of Transportation, you must file an HS-7 Declaration form at the time the vehicle is imported to identify the basis of entry. The HS-7 form is a declaration requirement subject to federal motor vehicle safety, bumper, and theft protection standards. It’s essential that Cambodian businesses that want to import to the US comply with this document accordingly to prevent penalties or importation issues.
When shipping vehicle engines into the United States, they must conform to the EPA emission standards and requirements. For all heavy-duty engines and nonroad engines being imported, they must submit the EPA Form 3520-21 and proof of purchase to the US Customs and Border Protection (CBP).
Know that customs will only allow your vehicle parts to enter if they meet the conditional admission criteria for emissions (EPA) and safety (DOT), in addition to all other Federal mandates. Vehicle parts not originally made for the U.S. market to be admitted into the U.S. must be imported either by an individual possessing a written exemption letter from the EPA or by an Independent Commercial Importer (ICI).
2. Tips On Packing Car Parts For International Shipping
Car components vary greatly in size and shape, necessitating proper packaging to guarantee their safe and secure delivery. Here are some optimal methods for packing car parts, whether they're small or large, for shipping:
- Ensure all fluids and lubricants within the parts are drained to prevent leaks and comply with shipping regulations.
- Where possible, disassemble automotive parts, as this makes them safer and easier to package.
- Use durable corrugated cardboard boxes for packing heavy metal components, and consider double-boxing for extra security.
- Wrap all pieces in bubble wrap to provide additional protection before placing them in larger containers. Foam wrapping or polystyrene can also be utilized to cushion the package effectively.
- Select boxes that match the shape of the items to provide adequate cushioning and support during transit.
- After the box is packed and the items are securely cushioned, seal the package with strong adhesive tape.
- Properly label the package, including warnings or fragile stickers as needed, to ensure careful handling during shipping.
