Intellectual Property Rights (“IPR”)

Another critical area in trade compliance in international competitiveness is the enforcement of intellectual property rights (IPR), which primarily affects IPR holders, but also poses significant risks for importers, especially those unknowingly involved in the distribution of counterfeit goods. In fiscal year 2024, CBP reported seizures of counterfeit products valued at over $5.4 billion, with top categories including jewelry, watches, handbags, pharmaceuticals, footwear, and consumer electronics (U.S. Customs and Border Protection, 2025-b). Without digitized tracking, even with considerable training, identifying counterfeit products are becoming increasingly more difficult. Blockchain traceability can assist both IPR holders and importers by enabling verification of the product’s origin and legitimacy through encryption tags embedded in packaging. In doing so, blockchain systems can support automated compliance checks, maintain IPR, and minimize the risk of mistakenly importing counterfeit goods.

Drawback

A potential concern for importers and exporters is the hassle of correctly compiling documents for drawback claims. Currently, under 19 CFR § 190.72, Federal regulations mandate export records, product identification codes, country of origin certificates, and declarations from individuals with direct knowledge of the merchandise’s condition. In addition, the various forms of drawback (manufacturing, unused, and rejected) may create a need for additional document compilation.

CBP has acknowledged the complexity of verifying drawback claims – especially for high-volume or commingled goods – due to the need for detailed documentation and approved accounting methods. Ultimately, this places a huge burden on importers to maintain reliable documentation across multiple systems, often using spreadsheets, emails, and paper records.

True Tag Tracker offers a system that allows all participants to record, track, and verify transactions in a time-stamped format, ensuring that entered data cannot be altered retroactively and generating a reliable data source for drawback claims.

Chapter 98 Partial Duty Exemption

Chapter 98 of the Harmonized Tariff Schedule of the United States provides businesses and individuals with the opportunity to claim partial or full duty exemptions. However, each form of Chapter  98 requires a unique set of documents to be compiled in order for the claim to be properly processed. For example, certain items exported for repair, made pursuant to a warranty (9802.00.40), may be reimported into the United States without additional duties but also require documentation, such as an assembler’s declaration and the commercial invoice generated for the item when it was initially purchased.

As such, True Tag Tracker simplifies the document compilation process. Specifically, any item exported for repair or alteration will carry the documentation required for re-entry into the United States, along with any documentation required by those performing the repair or alteration.

Foreign Trade Zone Inventory Controls 

A Foreign Trade Zone (FTZ) is a designated area within the U.S., but considered outside of U.S. Customs territory, where goods can be stored, processed, or manufactured without immediate payment of customs duties. FTZs are crucial for trade compliance because they allow businesses to legally defer, reduce, or eliminate duties under strict Customs supervision, ensuring adherence to complex trade regulations while optimizing costs and supply chain efficiency.

Importantly, all zone operators must either maintain a manual or automated inventory control and recordkeeping systems capable of:

• Accounting for all merchandise admitted into a zone 
• Producing accurate and timely reports and documents as required 
• Identifying shortages and overages of merchandise in a zone to determine the quantity, description, tariff classification, zone status , and value of missing or excess merchandise
• Providing all the information necessary to make entry for merchandise being transferred to the Customs Territory, and
• Providing an audit to Customs forms from admission through manipulation, manufacture, destruction or transfer of merchandise. See 19 C.F.R. § 146.21.

As such, the physical NFC tag and blockchain-backed content management system technology enable zone operators to maintain comprehensive automated inventory control using a smartphone.  A simple scan of the physical NFC tag will allow zone operators to fulfill the previously listed requirements, as content management can be customized to fit each zone operator’s admitted merchandise and subsequent activities.   

Ultimate Consignee Tracking 

The ultimate consignee is the person, party, or designee located abroad who actually receives the export shipment and may be the end user or another entity such as a distributor. Accurately identifying and reporting the ultimate consignee is critical; failure to do so can expose exporters to risks such as fines, shipment delays, or seizure, especially if goods end up with sanctioned or unauthorized parties.

The capabilities of our blockchain technology and physical NFC tags staves off such risks. Through contract terms negotiated between parties, end-users are required to routinely scan the NFC tag, ensuring that the ultimate consignee has not diverted and/or re-exported products to unwarranted destinations. In addition, the blockchain technology embedded in the NFC tag encrypts sensitive data and documentation that must travel with the export. As such, the release of technology to unverified end-users is never left to chance, and only the ultimate consignee intended to receive the technology will have access.