By Bernardo Campelo, Forbes Business Council E-Commerce Leader, Amazon SPN Certified provider, Amazon SP-API authorized partner, and Founder of PrepVia.
On September 25, 2026, Exame published a column in its Bússola section urging Brazilian brands that already sell cross-border into the United States to rethink their structure. Its argument is clean. Ship each order straight to an American consumer and duty falls on the full retail price. Open a U.S. subsidiary that buys from the parent at wholesale, and duty falls on that wholesale price.
The mechanism under that argument is real. Transaction value, the first method CBP uses, is the price paid or payable when goods are sold for exportation to the United States, under 19 CFR 152.103, plus a short list of additions. Change who buys at the border and you change which price lands on the entry.
What the column skips is what CBP does next. The price between your parent company and its own subsidiary faces a related-party test. Your subsidiary faces a June 2026 executive order that separates U.S. importers from foreign ones. Its importer number faces the Form 5106 enforcement CBP set to begin on September 18, 2026. A subsidiary changes who imports and which price you declare. It does not, by itself, carry that price, that importer or that address through any of the three.
The 60-second version
A U.S. subsidiary moves your customs value to a price set between related parties, and that price, that importer and that address each face a federal test. Under 19 CFR 152.103(j)(2), CBP accepts a related-party price if the relationship did not influence it or it closely approximates test values. Under Executive Order 14411, a U.S. entity whose controlling beneficial owners are not U.S. citizens or green card holders, and that owns no significant U.S. real property, falls outside the order's definition of a U.S. importer of record, although the measures aimed at foreign importers had been ordered but not implemented as of October 1, 2026. Since September 18, 2026, CBP says it will void an importer number with inaccurate or incomplete Form 5106 data, and the physical address cannot be a registered agent or another entity's address. The structure is a decision for your customs broker, attorney and tax adviser.
What the Column Gets Right, and What It Leaves Out
Two cautions come with the column. It is an opinion piece by the co-founder and CEO of Globalfy, a platform that helps entrepreneurs open and manage U.S. companies, so the author sells the structure he recommends. His observation that demand from Brazilian brands looking to start a U.S. operation fell about 50% in 18 months, while subsidiary requests jumped among existing cross-border sellers, comes from his own pipeline. It is not a published statistic.
The second caution is closer to Amazon. The column's example is a parcel sold directly to a consumer. Bulk cartons you ship to FBA under your own name are not that transaction, so its retail versus wholesale comparison does not describe that entry. Ask your broker which appraisal method your current entries use, in the order set by 19 CFR 152.101(b), before you compare anything.
The tariff pressure is real and layered. The U.S. Trade Representative imposed a Section 301 action of 25% on imports of Brazil, with exemptions, for goods entered from July 22, 2026. A separate Section 301 forced-labor action lists Brazil at 12.5% for goods entered from July 24, 2026. The column folds the two into a single figure that CBP has not published. The rate on any product line is your broker's determination.
Amazon's Brazil global selling page, checked on September 25, 2026, says a Brazilian company does not need a U.S. company to sell on Amazon.com and can register as a foreign importer of record or, in some cases, use a logistics operator acting as importer of record. The subsidiary is a business choice, not an Amazon requirement. For the basics this post skips, see the three routes from Brazil to Amazon US and who the importer of record is when a 3PL takes the container.
Rule One: The Parent-to-Subsidiary Price Has to Pass the Related-Party Test
Start with the relationship. Under 19 CFR 152.102(g), related persons include an organization and anyone owning, controlling or holding power to vote 5% or more of its voting stock, officers or directors of an organization, and persons under common control. Your Brazilian parent and the U.S. company it owns fit that definition.
Related is not the same as rejected. The regulation says CBP shall not disregard a transaction value solely because buyer and seller are related (152.103(l)(1)). Under 152.103(j)(2), which tracks the statute at 19 U.S.C. 1401a(b)(2)(B), your price is acceptable if the circumstances of sale show the relationship did not influence it, or if it closely approximates a test value: the transaction value of identical or similar goods sold to unrelated U.S. buyers, or the deductive or computed value of identical or similar goods. Each test value must relate to goods exported to the United States at or about the same time.
The Two Ways a Transfer Price Gets Defended
The circumstances route is about how the price was set. The interpretive notes in 152.103(l) point to a price settled in line with the industry's normal pricing practices, or with the way the seller settles prices for buyers not related to it. A price adequate to recover all costs plus a profit equivalent to the firm's overall profit over a representative period, in sales of goods of the same class or kind, also shows the relationship did not influence it. The test-value route is a comparison, and CBP applies no fixed percentage to decide what closely approximates means (152.103(l)(2)(ii)).
If you pick a transfer price because it shrinks the duty base, with no written method behind it, you have built exactly the case the related-party rule exists to examine. When CBP has grounds to reject a declared transaction value and the rejection would raise the duty, 152.103(m) requires CBP to tell the importer the grounds, and the importer has 20 days to respond in writing if it disagrees. That is not the moment to start building your file.
If the Price Fails, the Regulation Moves Down a List
| Order | Method | What it starts from | Source |
|---|---|---|---|
| 1 | Transaction value | Price paid or payable when sold for exportation to the U.S., plus listed additions | 19 CFR 152.103 |
| 2 and 3 | Identical, then similar goods | Accepted transaction values of identical or similar goods exported at or about the same time | 19 CFR 152.104 |
| 4 | Deductive value | U.S. price to unrelated buyers after importation, minus commissions or usual profit and general expenses, freight, insurance and duties | 19 CFR 152.105 |
| 5 | Computed value | Producer's materials and fabrication cost, plus usual profit and general expenses, assists and packing | 19 CFR 152.106 |
| 6 | Fallback | The earlier methods, reasonably adjusted, using information available in the U.S. | 19 CFR 152.107 |
Read the deductive row with an Amazon subsidiary in mind. Under 152.102(k), its starting price is the sale to unrelated persons at the first commercial level after importation, and if your subsidiary sells its own inventory on Amazon, that is the sale to the Amazon customer. As the importer, you may ask for computed value before deductive value (152.101(c)). This predicts no case, and the method is your broker's call.
Additions, Adjustments and the Tax File
Under 152.103(b)(1), transaction value adds packing and selling commissions incurred by the buyer, assists, royalties or license fees owed as a condition of the sale, and resale proceeds that accrue to the seller. A trademark royalty or a per-unit profit share paid back to your parent belongs in front of your broker before the first entry. Dividends that do not relate directly to the imported goods are not added (152.103(g)).
Two lines belong to the finance team. A rebate or other decrease in price made after importation is disregarded under 152.103(a)(4), so settle with your broker how a year-end transfer pricing adjustment will be treated before the first entry, not after the books close. And 26 U.S.C. 1059A provides that, for goods imported from a related person, costs counted in both the inventory cost and the customs value cannot sit in the inventory cost above the customs amount. Your broker and your tax adviser should be reading the same transfer pricing file.
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Rule Two: Executive Order 14411 Draws a Line Around Foreign-Owned Importers
Executive Order 14411, Strengthening Customs Enforcement, signed June 3, 2026 and published June 10, 2026 at 91 FR 35125, draws the line the column never mentions. Under Section 10, an entity is a U.S. IOR if it is organized under U.S. law, located in the United States and has at all times controlling beneficial owners who are U.S. citizens or lawful permanent residents. An entity that owns a significant amount of U.S. real property, as determined by the Secretary of Homeland Security, also qualifies. An importer outside that definition is a foreign IOR.
Now apply it to your structure. If your subsidiary's controlling owners are Brazilian, none of them a U.S. citizen or green card holder, and it owns no significant U.S. real property, it falls outside the order's definition of a U.S. importer of record. Forming it does not, by itself, settle your foreign importer question.
Section 10(c) sharpens a second screen already inside that definition. DHS is to issue guidance on what located in the United States means, with shell companies and artificial structuring in view. At a minimum, the entity needs its principal place of business in the United States, a physical presence where significant business activity is conducted, and sufficient tangible U.S. assets, considering whether it is an instrumentality of a foreign manufacturer without a substantial U.S. presence. If your subsidiary's main job is buying from your parent, read that clause with your attorney. A Federal Register search on October 1, 2026 found no such guidance.
In Force, Ordered, and on a Clock
Section 2(b) tells DHS to promptly bar foreign IORs from filing informal entries. Section 2(c) tells DHS to require that a foreign IOR on formal entry not rely on a continuous bond unless CBP permits it. The same foreign IOR would have to be CTPAT-validated if eligible, or use a CTPAT-validated licensed broker. As of October 1, 2026, a Federal Register search found no CBP rule implementing either measure.
Other parts run on a clock. Section 2(a) gives DHS 180 days from June 3, 2026, which lands on November 30, 2026 by count, to take steps to revise importer eligibility rules, including minimum domestic assets or bonding and disclosures of ownership, beneficial ownership and business affiliations. CBP also opened an advance notice of proposed rulemaking on heightened import disclosures on September 2, 2026, with comments due December 1, 2026.
The order also names its targets. Section 1 lists undervaluing imports among its examples of noncompliance, and Section 4(b) puts enforcement priority on importations involving forced labor, misclassification, undervaluation and illegal transshipment. A structure sold on a lower declared value sits right next to that conduct. That alone does not make it improper. It does mean you should document the price before your first container sails.
Rule Three: Form 5106 Wants the Subsidiary's Own Address, Email and Phone
Your subsidiary needs its own importer number, and that starts with CBP Form 5106. CBP's general notice of August 19, 2026, Accuracy of Importer of Record Data Submitted to CBP, at 91 FR 53627, says that from September 18, 2026, if CBP finds Form 5106 data inaccurate or incomplete, it will void the importer number, making it invalid for any purpose, including entering merchandise.
The physical address must be the actual physical location of the business or individual. It cannot be a registered agent, a customs broker, a freight forwarder, a P.O. box, a business service center, or an address of another person or entity, although a footnote allows the principal's home address. Email and phone must be valid and belong to the importer, and brokers or third parties may not substitute their own.
Picture your subsidiary on day one: a registered agent address from your formation service, your broker's contact details on the form, and your inventory in a third-party warehouse. The notice names the first two directly. It does not name 3PLs or prep centers, but read against its text, a warehouse operated by another company is an address of another entity. Settle the address with your broker before filing, not after a voiding notice arrives. Seller Central asks for addresses too, for other reasons, as the guide to which address goes where in FBA explains.
The notice also cites 18 U.S.C. 1001 for intentional false statements, possible False Claims Act exposure for inaccurate data, and broker penalties under 19 U.S.C. 1641. A broker needs a power of attorney executed directly with the importer, not through a forwarder.
The Three Rules Side by Side
The three rules test different things, run on different clocks and belong to different advisers.
| Rule | Federal text | What it tests | Status on October 1, 2026 | What to bring |
|---|---|---|---|---|
| Related-party value | 19 CFR 152.102(g) and 152.103(j), (l) | Whether the relationship influenced the parent-to-subsidiary price, or the price closely approximates a test value | In force | Pricing method, prices to unrelated buyers, cost build-up, royalties and profit shares |
| U.S. or foreign importer | Executive Order 14411, Sections 2 and 10 | Controlling beneficial owners, significant U.S. real property, whether the entity is located in the United States | Definitions published; foreign IOR measures ordered, not implemented; steps to revise eligibility due within 180 days (November 30, 2026 by count) | Ownership chart, U.S. assets, where the business is run |
| Form 5106 accuracy | CBP notice, 91 FR 53627 | Whether address, email, phone and identifiers belong to the subsidiary | Enforcement date of September 18, 2026, per the CBP notice | The address you will declare, and a power of attorney signed directly with your broker |
Rows one and three apply now. Recheck row two before each new entry.
Ten Questions to Settle Before the First Entry
Work through these in order. Each has an owner, and none of them is the prep center.
- Does a subsidiary change your current flow? If you ship bulk to FBA as a foreign importer today, ask which appraisal method applies now. (Broker)
- Who is related to whom? Map every 5% owner, shared officer or director and entity under common control against 152.102(g). (Attorney)
- How was the transfer price set? Write down the method in the terms 152.103(l) uses: industry practice, the way prices are set for unrelated buyers, or costs plus the firm's overall profit. (Tax adviser and broker)
- Is there a comparison point? Give your broker the parent's prices to unrelated U.S. buyers for identical or similar goods. (Broker)
- What flows back to the parent? List royalties, license fees, commissions, packing and profit shares tied to resales. (Broker)
- Do the customs file and the tax file agree? 26 U.S.C. 1059A ties inventory cost to customs value. (Tax adviser)
- How will year-end adjustments be handled? A decrease after importation is disregarded under 152.103(a)(4). (Broker)
- Where does the subsidiary fall under Executive Order 14411? Map owners, U.S. real property and U.S. presence against Section 10. (Attorney)
- What address, email and phone go on Form 5106? Each must belong to the subsidiary: not the registered agent, not the broker and, by the notice's text, not a warehouse operated by another company. (Broker and attorney)
- Who signs the power of attorney? It has to be executed directly with the subsidiary, not through a forwarder. (Broker)
Where the Inventory Sits, and What a Prep Center Does Not Do
The column's model ends with your inventory inside the United States, and it has to live somewhere between the port and Amazon. That is the prep center's part. After customs release, PrepVia unloads the container at its Miami dock, counts it against the packing list, takes condition photos, preps and labels the goods in a 24-36 hour prep window and sends the inbound to the fulfillment center, as the import and export page lays out. The company facts page lists unloading from $400 per palletized container, with floor-loaded containers quoted by carton count.
Everything upstream belongs to someone else. PrepVia is not an importer of record, a customs broker or a freight forwarder, does not operate a foreign trade zone, does not file entries and gives no customs, tax or legal advice. Whether inventory held at a third-party warehouse helps a subsidiary show it is located in the United States cannot be answered before DHS publishes its guidance, and then it is your attorney's question. The guide to who does what between broker, forwarder and 3PL draws those lines in detail.
Frequently Asked Questions
Does a U.S. subsidiary lower the duty on Amazon inventory?
It changes which price is declared. Whether a related-party price is accepted depends on 19 CFR 152.103(j)(2), and what a product line pays depends on its classification and the actions in force for it. Both are questions for your customs broker, and accepting the price is CBP's decision.
Are a Brazilian parent and its U.S. subsidiary related parties for customs purposes?
Under 19 CFR 152.102(g), related persons include an organization and anyone holding 5% or more of its voting stock, officers or directors, and persons under common control, so a parent and the subsidiary it owns fit. Being related does not disqualify the price, but the price has to pass the test in 152.103(j)(2).
Does my U.S. LLC count as a U.S. importer of record under Executive Order 14411?
Under Section 10, a U.S.-organized entity whose controlling beneficial owners are not U.S. citizens or green card holders, and that owns no significant U.S. real property, falls outside the definition of a U.S. IOR. The foreign IOR measures had not been implemented by CBP as of October 1, 2026. How your entity is treated is a question for your attorney and broker.
Can my subsidiary use its warehouse address on Form 5106?
CBP's August 19, 2026 notice says the physical address must be the actual location of the business and cannot be a registered agent, broker, forwarder, P.O. box, business service center or another entity's address. It does not name prep centers, but by its text a warehouse operated by another company is another entity's address. Your broker makes the call on your filing.
What happens if CBP voids the subsidiary's importer number?
Since September 18, 2026, CBP says a voided number is invalid for any purpose, including entering merchandise. CBP sends written notice to the email the importer most recently submitted, copies the last filing broker where applicable, and explains how to request reestablishment.
Does PrepVia set up subsidiaries, file entries or act as importer of record?
No. PrepVia is a 3PL and prep center in Miami that receives, counts, prepares, stores and ships inventory to Amazon after it clears customs. It is not an importer of record, a customs broker or a freight forwarder, and it gives no customs, tax or legal advice.
Final Take
The column is right that a subsidiary changes which price reaches CBP. It leaves out that CBP's valuation rules are written to question a price between related parties, that a June 2026 executive order draws a line around foreign-owned importers, and that Form 5106 enforcement now checks whether a new entity is really where it says it is.
None of that makes the subsidiary right or wrong for your brand. That call belongs to your attorney, your tax adviser and your broker. What the three rules change is the order of work: price method, ownership map and address first, company formation second, first container third.
If you go ahead, your inventory still has to land, get counted and reach Amazon on time. That is where a prep center's part begins, and only there.
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