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Determining Responsibilities of the U.S. Principal Party in Interest (USPPI)
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Determining Responsibilities of the U.S. Principal Party in Interest (USPPI)
The USPPI is the individual or legal entity in the United States that receives the primary benefit, financial or otherwise, from an export transaction. The following parties can be the USPPI: U.S. seller (wholesaler or distributor) of goods for export. U.S. producer (if selling the goods for export). Questions about who the U.S. Principal Party in Interest (USPPI) is frequently come up when reporting exports. The USPPI is the individual or legal entity in the United States that receives the main benefit, financial or otherwise, from an export transaction.
Who is the USPPI?
In 2000, the U.S. Census Bureau updated the Foreign Trade Regulations (FTR) and replaced the term exporter with the new term USPPI. There are the three major motives the regulations had been changed:
1. To clarify and specify the documentation and documentation-sharing responsibilities of all parties in an export transaction.
2. To identify the data the USPPI is responsible for reporting, including name, Employer’s Identification Number (EIN), and basic commodity information, to the U.S. agent of the Foreign Principal Party in Interest (FPPI) in a routed export transaction.
3. To create conformity in document issuance. For purposes of providing the electronic export information (EEI) that must be submitted to the Automated Export System (AES) for most exports, the exporter is always designated as the USPPI, which the Foreign Trade Regulations clearly specifies.
What is the difference between USPPI and Exporter?
The distinction between a USPPI and exporter was created for a few reasons. First of all, it helps in determining who is responsible for documentation and documentation-sharing between all parties involved in the export process. Secondly, it indicates the specific data that the USPPI is responsible for sharing (EIN number, basic commodity information, U.S. agent of the FPPI, etc.) Lastly, it creates conformity in the issuance of documentation to AES. All things considered, the distinction between the USPPI and exporter can be important to understand – especially if you are playing a role in either end of the exporting transaction.
Who Can be a USPPI?
Any of the following entities can be a USPPI:
- Manufacturer in the US selling products for export
- Distributor of the products
- Third party in the US that negotiates between the foreign buyer and seller, and receives a purchase order for the export of goods
Who Cannot be a USPPI?
A consolidator or a forwarding agent cannot be a US Principal Party of Interest USPPI. There is only one exception to this case. A forwarding agent who acts as a customs broker or has arranged the clearance list can apply to be listed as a USPPI. The only requirement is that the product should be exported without any modification or upgrade.
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