For which company below will the customs broker be required to obtain documentation establishing the authority of the grantor to execute a power of attorney?
How to get there
19 CFR 141.37: Additional requirements for nonresident corporationsIf a nonresident corporation has not qualified to conduct business under state law in the state in which Customs district the agent is empowered to perform the delegated authority, the power of attorney shall be supported by documentation establishing the authority of the grantor designated to execute the power of attorney on behalf of the corporation.
19 CFR 141.31(d): Resident vs nonresident… “resident” means … a corporation incorporated in any jurisdiction within the Customs territory of the United States or in the Virgin Islands of the United States. A “nonresident” means an individual, partnership, or corporation not meeting the definition of “resident.”
The customs territory includes only the States, D.C. and Puerto Rico (19 CFR 101.1). Checking each company:
- U.S. Virgin Islands corporation: resident (named expressly in § 141.31(d)).
- Delaware corporation: resident (a State).
- Puerto Rico corporation: resident (Puerto Rico is customs territory).
- Costa Rica corporation, registered only there: nonresident, and not qualified under any state's law, so § 141.37 applies.
The answer is C.
Why the other choices are wrong
A) U.S. Virgin Islands corporation: the USVI isn't customs territory, but § 141.31(d) expressly treats USVI corporations as residents.
B) Delaware corporation: incorporated in a State, so a resident.
D) Puerto Rico corporation: Puerto Rico is part of the customs territory, so a resident.
Tip
Resident corporation = incorporated in a State, D.C., Puerto Rico or the USVI. Foreign corporations not qualified to do business in the relevant state need proof that the person signing the POA is authorized.
Sources: 19 CFR 141.31(d), 141.37, 101.1 (“Customs territory of the United States”) (eCFR).
CBP answer key: Answer C · 19 CFR 141.31(d); 19 CFR 141.37; 19 CFR 101.1Source: CBP past exams ↗