Power of Attorney in Shipping: Quick Guide for Importers and Exporters
October 28, 2022 Documentation
In general terms, a Power of Attorney is a legal document that transfers certain powers from one person to another person. Powers of Attorneys are often used if Person A needs Person B to make a financial, health, or other personal/commercial decision on their behalf.
In shipping, Powers of Attorney (POA) are important when an importer or an exporter appoints an agent – namely, a freight forwarder – to act on their behalf to handle all aspects of their shipment.
What Is A Power Of Attorney For?
A Power of Attorney is used when a buyer or a supplier seeks to engage an agent, whether they be domestic or foreign, to undertake business on their behalf. They are commonly used in the USA to allow a forwarder to obtain control of the cargo. In Australia, we use a Customs Clearance Authority (or CCA) in place of a POA.
In the USA, the Power of Attorney will transfer decision-making power, including the power to sign and arrange the relevant shipping documentation, from the importer/exporter to the freight forwarder. This is so the freight forwarder can properly and lawfully act in its role as an intermediary between a supplier and a purchaser.
Powers of Attorney will last until a specified time, at which point the power is revoked. This may occur at the completion of a shipment, for example.
What Does It Include?
Powers of attorney will typically include:
- The importers business name and address
- The business IRS (Internal Revenue Service Number) Equivalent to Australian ABN
- A declaration that the nominated forwarder can act on behalf of the importer; and
- the witnessed signature of the importer/exporter;
Note that a Power of Attorney does not operate as a contract between an importer, exporter or freight forwarder. It is simply an assignment of legal powers from one entity to another.
It is important that a Power of Attorney is worded appropriately to allow a forwarder to act on your behalf in the USA, as it is this document that will facilitate a freight forwarder’s completion of your shipment.
It is therefore vital that you select a freight forwarder that you trust prior to signature, as they will obtain authority to handle and clear your cargo.
If you have any queries or talk to one of our friendly freight experts at ICE.Request A Quote
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