Exporter of Record vs Shipper – The Key Differences

The success of any trade relies on a clear understanding of each related role in the process, such as the difference between the exporter of record vs shipper. While both are integral to the global supply chain, their responsibilities are often misunderstood. Understanding these distinctions is essential for businesses engaged in cross-border operations to ensure compliance, mitigate risks, and optimize operations.

In this article, we explain the unique functions of shippers and EORs, highlighting their legal obligations and distinct duties. By the end, you will have a solid grasp of these roles and the insights needed to confidently manage the complexities of trade compliance.

What is The Shipper Meaning?

The term “shipper,” also known as the “consignor,” plays a vital role in logistics and the supply chain process. A shipper is an individual or company responsible for consigning or sending goods to another party, such as a customer, retailer, or other business. Typically, shippers are manufacturers, suppliers, or distributors who need to transport their products to fulfill orders or ensure the smooth flow of goods within the supply chain.

The shipper’s responsibilities can include packaging the goods, selecting the mode of transportation, preparing shipping documentation, and ensuring compliance with relevant regulations. Understanding the role of the shipper is crucial for businesses involved in trade, as it directly impacts the efficiency and compliance of the overall shipping process.

Shipper’s responsibilities

The responsibilities of a shipper extend far beyond simply handing over goods for transport. Shippers ensure products reach their destinations on time and in optimal condition. Their involvement is key throughout the shipping process, beginning with preparing the goods for shipment and continuing through the actual transport. Key responsibilities of a shipper include:

• Inventory Management: Ensuring products are properly tracked and available for shipment when required.
• Storage Management: Responsible for properly storing goods before shipment and maintaining them in optimal conditions to avoid damage.
• Product Selection: Responsible for carefully choosing the right products for shipment and ensuring they are accurately delivered to the designated recipients
• Maintaining Accounting and Record-Keeping Systems: This involves keeping accurate records of shipments, including invoices, receipts, and other documentation needed for financial tracking and compliance.
• Understanding Shipping Policies: Being knowledgeable about shipping regulations, insurance, customs requirements, and any other legalities related to transporting goods.
• Filling Out Required Forms: Completing necessary shipping documents such as the Bill of Lading (BOL), export declarations, and any customs forms required for international shipments.

What is meant by the exporter of record?

An Exporter of Record (EOR) is a critical legal entity in international trade. It ensures that goods leaving the country adhere to all relevant export regulations. The EOR is the legal entity designated as the exporter in official customs documentation and is accountable for complying with all legal and regulatory requirements governing the exportation of goods.

EOR’s responsibilities

The Exporter of Record has many crucial responsibilities that ensure smooth and compliant international trade operations. The EOR is accountable for managing the export process from start to finish and ensuring that all legal and efficient goods transportation requirements are met. Key responsibilities of the EOR include:

• Adhering to Customs Processes: Ensuring compliance with all customs procedures and regulations for the export of goods, including the correct classification of goods and submitting proper documentation to customs authorities.
• Obtaining Necessary Documentation: This involves acquiring and managing all required export licenses, permits, and other certifications needed for the shipment, especially when exporting controlled or restricted items.
• Ensuring Accurate Description and Valuation: Providing a correct and complete description of the goods being exported, including their valuation, to ensure proper classification and duty assessments by customs.
• Complying with Export Regulations: Ensuring that the shipment complies with all relevant local and international export regulations, including sanctions, trade restrictions, and product-specific controls.
• Assuming Responsibility for Shipments: Taking responsibility for the shipment’s successful delivery to the destination. If goods fail to reach their destination, the EOR is legally responsible for resolving the issue.
• Bearing Financial Consequences: Assuming financial liability for any delays, fines, or costs arising from late or undelivered shipments, which can include penalties for non-compliance or misclassification.
• Providing Shipment Information to Forwarding Agents: If involved, provide forwarding agents with all necessary shipment details to ensure the logistics process is executed smoothly and in line with all compliance requirements.

The key Distinctions of exporter of record vs shipper

While the roles of the exporter of record and shipper often overlap, key distinctions exist between the two. Understanding these differences is essential for businesses engaged in international trade. A company can serve as both the shipper and the EOR, but each role comes with its own set of responsibilities and potential liabilities. Below is a table that outlines the key distinctions between the exporter of record and the shipper:

Can the shipper be the importer of record?

In the previous sections, we discussed the roles of the Exporter of Record vs Shipper. Now, we will address the question: Can the Shipper Be the Importer of Record? While the shipper and the Importer of Record are distinct roles, each with its specific duties and responsibilities, it is indeed possible for the shipper to also be the IOR. It’s important to note that these roles come with different legal, regulatory, and compliance obligations.

The shipper is responsible for preparing goods for export, ensuring they are properly packaged, labeled, and ready for transport. This includes managing logistics and working with carriers to deliver goods from the origin country to the destination safely. In contrast, the IOR ensures that goods comply with import regulations upon arrival in the destination country. The IOR handles customs documentation, pays import duties and taxes, and ensures compliance with local regulatory requirements for entry.

When can the shipper be the importer of record?

In some cases, the shipper can also fulfill the role of the Importer of Record, particularly in situations where the same entity is responsible for both the export and import of the goods.

This might happen in the following scenarios:

• Same Entity Handling Both Export and Import: If the shipper is also the entity receiving the goods at the destination, they may take on the IOR responsibilities. This is common when a company manages both the shipping and receiving processes or operates in both the origin and destination countries.
• Legal and Regulatory Expertise: The shipper can assume the IOR role if they have the necessary legal capacity and expertise to comply with import regulations in the destination country. This includes knowledge of customs procedures, tariffs, duties, and any specific import permits or certifications that might be required.
• Control Over the Supply Chain: If the shipper owns the goods and controls both the export and import processes, it is feasible for them to take on the IOR responsibilities, especially if they are handling customs clearance, payment of import duties, and managing other import compliance requirements.

Simplify Your Trade Compliance with Egypt IOR

At Egypt IOR, we specialize in providing seamless Exporter of Record solutions for your global trade needs. We ensure your business operates smoothly and efficiently from IOR and EOR services to reverse logistics, RMA, NTRA-compliant processes, and Delivered Duties Paid (DDP) services.

Partner with us to simplify your logistics and compliance challenges while focusing on what matters most. Take the first step toward hassle-free global trade today. Fill out the form now to connect with our experts and get a customized solution for your business needs.