UK Parcel/Goods Forwarding Service. Is it Legal, What are the Responsibilities...

[blobert]

Hello,

I'm thinking about setting up a service that forwards parcels from the UK to other EU countries. The idea being that one can order goods within the UK from companies that don't deliver abroad and have them forwarded on to their home address.

I know such companies exist already but they all seem to be perhaps less than legitimate, ie some guy using his home address so send parcels on. There are also US versions of this.

Is this a legitimate and legal business? If so can someone point me in the direction of companies that do this?

It seems a very simple business model. Lets imagine a person living in France orders some shopping from the ASDA website. They pay with their credit card and put down my forwarding company as the delivery address (I know not all retailers will let you use a different address than your home one). They then go to my website and separately pay me £20 to forward their shopping to them in France. My Forwarding company forwards them on their shopping by courier at a cost of £5 and makes a decent profit.

This is an example, I'm aware that French people don't want to do their shopping in a UK ASDA but I don't want to give away too much about my actual plan.

If a company were to do this I'm also interested with what their legal responsibilities are. As the customer is buying direct from the company selling the goods I'm assuming their contract of goods/service is still with them if there are problems? Similarly, because my company is not selling the goods I would not be paying VAT etc on the goods sold, the only money we would be handling is the delivey fee. Does this sound about right?

Assuming that such a business is legitimate I foresee a couple of problems.

(1) Finding companies that allow delivery to addresses other than cardholders. I'll have to check up on what companies allow this.

(2) Is it my companies responsibility to check all goods before sending them? For instance if my French customer orders alcohol/tobacco/other goods subject to excise duties is it my companies responsibility to pay these duties as I am sending them to another country? Similarly, as the company forwarding the products is my company responsible for the contents (if the French person ordered a gun for instance).

(3) This service may be prone to credit card fraud, ie someone could steal a credit card and use this service to buy goods and have them delivered anywhere they want. I suppose I could get proof of address (fax bill or check electoral register) for new customers or for larger orders.

(4) I'm guessing I would need fairly strict terms and conditions. Let's say ASDA fail to deliver the ketchup as part of the French person's order, my company should not be responsible for this but rather only forward on what we have received. Would this be a legitimate clause?

I know a lot of this sounds very abstract, as I say I am using obscure examples but I think I have a very sound business idea based on the above.

Any advice on the legalities of this or of who to contact to check up on this would be much appreciated.

Thanks in advance.

[sysops]

Is this a legitimate and legal business? If so can someone point me in the direction of companies that do this?

Yes it is, but read on.


It seems a very simple business model. Lets imagine a person living in France orders some shopping from the ASDA website. They pay with their credit card and put down my forwarding company as the delivery address (I know not all retailers will let you use a different address than your home one). They then go to my website and separately pay me £20 to forward their shopping to them in France. My Forwarding company forwards them on their shopping by courier at a cost of £5 and makes a decent profit.

This is an example, I'm aware that French people don't want to do their shopping in a UK ASDA but I don't want to give away too much about my actual plan.


Taking this example, how much do you think it will cost me (as someone living in France) to get my Asda order through you? Bear in mind that you have to pay to ship it, and still make some money.

And what happens when my order turns up and includes two pots of Ben and Jerrys and an 18 pound turkey?


If a company were to do this I'm also interested with what their legal responsibilities are. As the customer is buying direct from the company selling the goods I'm assuming their contract of goods/service is still with them if there are problems? Similarly, because my company is not selling the goods I would not be paying VAT etc on the goods sold, the only money we would be handling is the delivey fee. Does this sound about right?

I'll leave this one for the legals, but I think you are basically correct.



(2) Is it my companies responsibility to check all goods before sending them? For instance if my French customer orders alcohol/tobacco/other goods subject to excise duties is it my companies responsibility to pay these duties as I am sending them to another country? Similarly, as the company forwarding the products is my company responsible for the contents (if the French person ordered a gun for instance).

I think this will be one of your biggest problems.


(3) This service may be prone to credit card fraud, ie someone could steal a credit card and use this service to buy goods and have them delivered anywhere they want.

And this.



(4) I'm guessing I would need fairly strict terms and conditions. Let's say ASDA fail to deliver the ketchup as part of the French person's order, my company should not be responsible for this but rather only forward on what we have received. Would this be a legitimate clause?

And you'll have endless fun with this one.


Ok, companies like this exist, and some of them are quite reputable. The one we come across regularly is called Aramex. We don't ship to the Gulf states, but there are a lot of people there with a lot of money. This company allows rich Gulf state residents to order stuff which they can't otherwise get.

We occasionally get problems, because Aramex will remove any products which they can't legally ship out. Because we're shipping to a UK address, we don't screen those orders, they get what they order. But when the customer receives the order, and its missing some items (lighters, food items etc), they are understandably unhappy.

Typical charges are something like £20-£40 per kg. That's a lot of money, but as long as you have a sufficiently wealthy client base, it can work.

The trick is to match up customers who have money with products which they can't otherwise buy. This means abandonning the Asda and France example altogether.

Having said all that, and despite having a big warehouse, spare staff capacity, and fantastic shipping deals with parcel carriers, I wouldn't touch this one with a 20' bargepole.

[tom111]

How would you prevent someone using your company to ship illegal drugs in and out of the country?

If you chose "search the package", what happens if someone accuses you or a staff member of losing the property / theft?

[blobert]

Thanks a lot for the advice, I appreciate it.

As I said I have no intention of sending ASDA food to France, it was just an example, I know it wouldn't work.

But I do have a plan to forward goods that are 30%+ cheaper in the UK than elsewhere to other parts of the EU with extremely minimal courier costs (my figure of £5 is about accurate) whereas for the customer to get the goods otherwise would cost about £80+

I just don't want to go into too much detail as to what it involves.

Does anyone have any example of forwarding companies within the UK? My Google searching is producing nothing

Would I have a legal obligation to inspect the good I was forwarding? I'm assuming courier companies do not inspect everything they deliver, rather they just have a list of what they do and do not ship.

With regards to shipping drugs, I believe people do use courier companies to send drugs around. My company would be accepting deliveries from reputable UK retailers and sending them on, I don't see how this would help transporting illegal goods. if I wanted to send drugs to another part of Europe I would just walk into my local courier drop shop (GLS for example) and send them anonymously that way.

With regards to customers accusing me of stealing goods, I'm guessing any forwarding company would be vulnerable to this. I'd have to make sure that everything that was delivered to my company was forwarded. Unfortunately that does mean relying on the original company sending the right products and the courier company in turn delivering the goods on but I think it should work.

I'd really appreciate any other advice on this.

Thanks

[sysops]

But I do have a plan to forward goods that are 30%+ cheaper in the UK than elsewhere to other parts of the EU with extremely minimal courier costs (my figure of £5 is about accurate) whereas for the customer to get the goods otherwise would cost about £80+



It sounds like you have a very specific set of products you are looking at forwarding. This isn't how a forwarding company works - you can't be that selective.


Would I have a legal obligation to inspect the good I was forwarding? I'm assuming courier companies do not inspect everything they deliver, rather they just have a list of what they do and do not ship.

You are legally responsible for what you ship, so yes, you have a legal obligation to inspect it. You also have a contractual obligation with yoru shipping company to do so. And finally, you will need to complete and sign customs declarations.

And I don't know where your £5 figure comes from, but you need to look into that before spending any more time on this.

[blobert]

Thanks again,

I'd be looking at forwarding goods from a number of fairly major UK retailers, I'd have a list of companies that customers could have goods forwarded from so it wouldn't be a forwarding company in the strictest sense but rather a forwarder of specific goods.

The £5 figure is accurate, if I was forwarding enough goods it could even be less than this. This is the mean reason I think this business model is viable, I can get goods to people for far less than they cost in their country with minimal delivery costs.

The inspecting of goods would add a time consuming element to this alright but I suppose it could be done quick enough. In terms of customs declarations I would be forwarding goods that can be freely moved within the EU (I'll have to double check on this of course).

Does anyone have any example of forwarding companies within the UK? My Google searching is producing nothing

[sysops]

The £5 figure is accurate, if I was forwarding enough goods it could even be less than this. This is the mean reason I think this business model is viable, I can get goods to people for far less than they cost in their country with minimal delivery costs.

I'm still very dubious about this - even RM ISF goes above £5 when you hit 200g.


Does anyone have any example of forwarding companies within the UK? My Google searching is producing nothing

http://www.aramex.com/

[blobert]

Thanks, the cost is correct, as I said I don't want to go into too much detail.

I've had a look at the aramex website, is there any other ones out there in the UK shipping to the EU as opposed to the middle east?

Something along the lines of:

bongous.com

But UK based?

[Officebird]

I would have thought your proposed business would be governed by the same regs as my forwarding address service is. Notably the new anti money laundering regulations. You should check out the HMRC website and will probably have to register with them to offer this service and jump through a ton of hoops for each client.

Just to forward a letter in the UK requires registration, passing a fit and proper test, obtaining proof of ID and address, a successful AML check, booking in and out of every letter as well as scanning the front to prove it didn't look dodgy. I have insured T&C's and strict rules on what I do and do not accept. I have turned down clients on nothing more than a hunch as the new laws would class me as an accessory to money laundering or terrorist activity if someone used my service for such an act.

There is an article on accountingweb about employees of a firm being fined personally for not conducting due dilligence on clients, even though no ML occurred.

From the questions you are asking I feel as though you have a lot more research to do. You need to speak to HMRC (although won't get a definitive answer from them!), you need to find out if you can get insurance for this, you need to study the new AML regs and you need to work out what measures you will put in place to cover your bum if all goes wrong.

I wouldn't dismiss people using the service for shipping drugs but would also consider how easy it would be to pack up a whole host of child porn DVD's to make it look like it comes form Amazon, or how easily a package could contain anything it's not suppossed to. These things happen and if you forward parcels on you are responsible for the content. There will also be laws in the country you are shipping to which you would need to know inside out.

There is a demand for this, my brother lives in brunei and has issues getting things shipped out so my parents order online and then post out to them. This is mainly kids clothes from next and the like so I don't know how comparable this is.

I hope you look into this more than you have so far and are crystal clear on your obligations before you move forward.

I also hope this helps in your research even though it may not be what you want to hear.

[blobert]

Thanks for your reply, I'm going to get in touch with HMRC to see what they say.

As IU say I will only be accepting deliveries from a few known sources so unless someone gets a fake Argos truck etc I will know where the goods are coming from which should eliminate the possiblity of dodgy dealings.

If anyone else knows who I should contact about the legalities of this please let me know.

Thanks again for all the continued help.

[sysops]

As IU say I will only be accepting deliveries from a few known sources so unless someone gets a fake Argos truck etc I will know where the goods are coming from which should eliminate the possiblity of dodgy dealings.

Most online retailers do not use their own vehicles, they use Royal Mail and/or parcel carriers. It would be trivial to send a parcel though the Royal Mail which for all intents and purposes looks like it came from Amazon.

[blobert]

Thanks again for the replies, I don't want to get bogged down discussing how my business could be used to forward drugs etc, as I have said already there are much easier, more anonymous ways to do this if one wanted to rather than going to the trouble of faking Amazon boxes etc, besides if I fully explained my plan it would be clear this is not a likely scenario.

What I was hoping was that people might have some more ideas of who I need to contact about opening a business such as this, is their anyone other than customs that I need to speak to?

Thanks again for all the advice

[YarinTasneem]

Hi friends,
I'm new here.
Hi blobert,

I've read your all these post. I agree with you and I also want to know the legalities of this.

Thanks wise man