PROCUREMENT OF CONUS MATERIALS
1. A s a general rule, procedure used by the local construction
contractor who must procure CONUS materials for the NAVY project
i s as follows:
Contractor contacts local trading company (many Japanese
l o c a l trading. companies do business for limited kinds of
B e c a u s e quantity normally associated with our
p r o j e c t s i s s m a l l , large Japanese trading companies do not get
b. A f t e r research, local trading company places an order to a
counterpart supply company in the United States. I f a v a i l a b l e
i n f o r m a t i o n is not sufficient for an order, request is made to
M a t e r i a l Supplier in the United States to look for an item meeting
t h e project requirements.
c . T h e material supplier in the united States contacts
various manufacturers for quotation and places an order on the
The amount requested by the material supplier in the United States
f o r the CONUS material includes followings:
( 1 ) Material cost negotiated with manufacturer
( 2 ) Air/ocean freight charge including currency adjustment
(3) Yard handling charge
(4) His handling charge
I n this case, the Japanese trading company cannot know the actual
p r i c e n e g o t i a t e d , b e c a u s e the material supplier does not show
actual price on his bill.
d Once off-loaded, the Japanese local trading company
r e c e i v e s material at Haneda/Narita/Yokohama and delivers to the
c o n s t r u c t i o n contractor at the construction site after completion
o f regal paperwork for custom office.
The amount requested by the Japanese local trading company to the
c o n s t r u c t i o n contractor for the CONUS material includes the
( 1 ) All costs described in paragraph c.
( 2 ) Yard handling charge including storage (in Japan)
( 3 ) Custom charge including miscellaneous legal paperwork.
There is no custom duty on imported property for use on
o u r projects but there will likely be some fees for
c u s t o m s processing, enclosure (7).
( 4 ) Transportation cost from yard to the job site
(5) His handling charge
E n c l o s u r e (2)