If you have any question about power of attorney, you will find the answer right here.
So, keep reading to learn more.
What Is Power Of Attorney (POA) In Freight Forwarding?
Power of Attorney
Power of Attorney is a legal document which assigns/transfers legal power from one person to another.
In Freight forwarding, Power of attorney is a grant of authority, where the importer/exporter appoints an agent called freight forwarder.
POA enables the freight forwarder to handle various or all aspects of shipment on behalf of the importer or exporter.
When Do You Need A Power Of Attorney?
When you are assigning responsibility to another entity, then a validated POA is obligatory.
With the aid of this document, the forwarder or customs broker has the capacity to perform customs clearance for your shipment.
Your appointed organization will need a signed POA to clear your cargo with the respective customs authority. The involved entities must finish all the power of attorney formalities before the cargo is shipped.
Is It Mandatory To Get Power Of Attorney?
No. You only require Power of Attorney if you are delegating power to another party to act on your behalf during a shipment process.
How Does The Power Of Attorney Work?
At times referred to as “letter of empowerment”, POA grants the custom broker or forwarding agent management of the shipment so they can:
- Draw up, sign and file applicable shipping documents on your behalf
- Serve as a middleman between you and the supplier of the goods.
- Handle the cargo
- Obtain customs clearance for the cargo
You will need to draft POA if you intend to grant authority to freight forwarder to process customs clearance documentations on your behalf.
The document must specify the powers you are granting and must accompany the freight for customs inspections at the destination port.
The power of attorney must be prepared prior to shipment of the cargo.
The documentation makes sure that all communications relating to the freight are done through the appointed agent rather than yourself.
This is especially crucial if working with a forwarding agent to ensure no details missed during the customs filing process.
Similar to all shipping documentations, you should word the POA content precisely so that the terms of power transfer are clear.
Of course, the agent you are giving the power of attorney should be trustworthy.
What Is Information Should A Power Of Attorney Include?
There are certain important information which you must provide fully when you are completing the power of attorney:
- Type of business you operate
- Sole Proprietorship
- Limited Liability Company.
- Full legal name of business
- Where the business is registered
- Place of business of the entity
- Designation of the forwarder or broker who will be managing the customs process on your behalf
- Date Signature, designation of the signor
In case of a foreign importer, person signing the POA must give supporting documents authorizing them to transact on behalf of the business.
The provided documentation needs to be wholly accepted by the regulations of the country where the business is registered.
However, remember that power of attorney doesn’t serve as an agreement between an importer, exporter or freight forwarding agent.
Basically, it is an allocation of legal capacity from one organization to another.
Who Is Allowed To Sign The Power Of Attorney?
Power of Attorney in Shopping
The owner of the business/company doing the shipment must sign the Power of attorney. It is also possible for someone from the company sign the POA.
Authority to sign sometimes depends on the structure of the company/business (individual, corporation, etc.). Moreover, some authorities require a secondary witness signature from another officer of the company/business making the shipment is very important.
How Do You Acquire A Power Of Attorney?
Your freight forwarding agent or customs broker will take you through the process of obtaining the power of attorney.
Furthermore, they will assist you in procuring the necessary documentation.
Nonetheless, when shipping without the aid of forwarder or broker, you can download POA templates from the internet.
What Is The Cost Of Getting Power Of Attorney?
This is subject to your freight forwarder or customs broker, but in most cases the fee is not more than $200.
How Many Types Of Power Of Attorney Are There?
There are four types of Power of Attorney namely:-
Export Power Of Attorney
This POA is signed by the exporter. The exporter authorizes the freight forwarder to manage the shipment and deal with customs clearance documentation.
Import Power Of Attorney
The buyer or seller of a consignment will appoint an agent and permit them to handle their consignment. The permitted agent/freight forwarder will handle customs and other entry requirements on behalf of his client.
Customs laws in some countries require that an import POA be signed by the freight forwarder or customs broker.
General Power Of Attorney
This is an authorization from a merchant giving their forwarder or agent authority to handle all issues relating to the shipment on their behalf.
Durable Power Of Attorney
This is an authorization from a shipper giving their forwarder or agent authority to handle specific issues relating to the shipment on their behalf.
The Power of attorney document must clearly and explicitly state the issues concerned.
When Does The Power Of Attorney Expire?
The Power of attorney document is valid until the specified date at which the POA ends. In most cases, this is when the shipment is completed.
Often the Power of attorney is labeled ‘UNTIL REVOKED’. This means that the business/company and their appointed agent/forwarder can revoke the power of the Power of Attorney at any time.
How Does The Power Of Attorney Benefit You When Shipping From China?
Power of attorney helps businesses/companies/individuals shipping from China to avoid unnecessary delays that may affect shipment.
The power of attorney also ensures that customs, rule and regulations are adhered to.
The Power of Attorney document legalizes the transfer of responsibilities for consignment handling from the importer/exporter to their freight forwarder.
This enables authorized forwarder to manage customs clearance complexities at the port of China and other issues that may arise.
Importance of Power of Attorney in Freight Forwarding