• 05-04-2022

Custom Clearance: 7 things to do

Customs clearance is a required procedure before goods can be imported or exported internationally. If a shipment is cleared, then the shipper will provide documentation confirming customs duties that are paid and the cargo can be processed. Before shipping various goods, a shipper may wonder what customs clearance means and how it’s relevant to their shipping options. Every international ocean freight forwarding company that makes its shipment must meet the quota of customs clearance in each country. Within this process, there’s also information concerning freight with imports and exports with parties involved in the process.

What are the major things that are considered in custom clearance? Let's take a look!

Pick a Customs Broker

A customs broker is an agent for importers who aid importers with the marketing of their customs business. These agents are licensed by tariff laws. A customs broker is either a private individual or firm that are licensed by the U.S. Customs and Border Protection to manage custom entries, payment of duties, and how this process may be affected by CBP discharges goods from custody.

A customs broker can help with HTS codes, which are based on product classification codes between 8-10 digits. HS codes mean the first six digits and countries of import include proceeding digits that are provided for additional classification. All codes are administered by the U.S. International Trade Commission. In addition, choosing the country of origin can be challenging to determine for Customs. Country of origin is critical for marking. It is defined by the country that which goods were assembled or the most work was put into the product.

Check for Import and Export Restrictions in Specific Countries

Before you ship your goods on their way, you have to confirm that your freight is allowed to be exported from the country of origin and allowed to enter the country of arrival.

Countries prohibit certain goods from being exported or imported. If you export or import prohibited goods without the relevant written permission or license, your cargo may be taken and you could face penalties.Countries also impose restrictions on the export and import of specific goods for various reasons. Before you ship your cargo, you need to be aware of any restrictions that apply to you. Here are a few examples:

  • Age restrictions
  • Quantity restriction
  • Packaging restrictions
  • Licensing restrictions

Verify Your Compliance With Trade Agreements

Trade agreements impact global trade and determine the tariffs and duties that countries impose on imports and exports. Certain trade agreements can be to your advantage, such as a free trade agreement, but they can also restrict your opportunities.

Verify Any Trademarks and Copyrights

When importing your goods to a foreign country, you have to protect your intellectual property (IP) when exporting and ensure that you are not infringing anybody else’s IP. When you export, you typically don’t get the benefit of patents, trademarks, registrations, and copyright protection in your home country.

Research Your Supplier and Buyer

You must check all parties involved in your supply chain, like suppliers and buyers, against restricted party lists. Restricted parties, also called denied parties, are organizations, companies, or individuals that governments have identified as entities that one must not do business with.

Prepare All Required Documents

To start the customs process, your customs broker will need the required paperwork. These are the documents that are usually a must for most customs officers:

  • Commercial Invoice
  • Packing List
  • Certificate of Origin
  • Letter of Credit or other payment terms
  • Airway Bill for air shipping and Bill of Lading for ocean shipping

Comply With Packing Requirements

The right packaging is important to ensure that your products arrive safely and without damage. However, you also have to watch out for detailed packing requirements that apply for certain goods (e.g., aerosol, sprays, medicines) in the country of origin or destination. Sometimes, the authorities will instruct a customs inspection or a customs-intensive exam of your cargo. If your packaging is not up to standard, you can face a delay and additional customs costs.