No law says you must hire a customs broker to help you clear imports into the US. But a smart importer, whether large or small, usually engages with an expert for customs brokerage services.
Following is a primer on customs brokerage and how a licensed broker can help you clear shipments quickly through Customs, keep you compliant with all regulations, and help you avoid costly mistakes.
As an importer, ultimately you are responsible for completing the necessary documentation, providing accurate information and paying the duties and fees that apply. But your broker does the actual work on your behalf.
And the customs broker has your back. Intimately familiar with import procedures and regulations, a licensed broker makes sure you provide all the data for your filings, double-checks that information for accuracy and meets deadlines for transmitting documentation to Customs and Border Protection (CBP).
When you form a relationship with a customs broker, your first step is to sign a power of attorney, authorizing the broker to act for you in future transactions with CBP. If this is your first import, the broker can also help you register with Customs as an Importer of Record (IOR).
Then, when you bring a shipment into the US, the customs broker does the following:
Yes. Any company, as long as it has a licensed Customs Broker on staff, can assume the duties just described with an in-house team. Large companies are likely to have their own trade compliance teams. But in smaller businesses, trade compliance is often an added responsibility for the logistics director, the CFO, or even the owner – all of whom have full plates already.
As we point out in our Guide to International Shipping for Small Business, the simpler answer may be to source customs brokerage services from an experienced customs broker that you trust.
Handling the Customs aspect of importing and exporting goes well beyond the tactical execution issues we’ve covered. Laws, regulations and Customs requirements are changing constantly. Customs brokers must constantly update their knowledge to stay up to speed on trade agreements, customs procedures and tariff rates. It’s tough to commit to this level of ongoing education in a part-time role.
And remember, your company is legally responsible for all customs declarations. Since incorrect declarations can lead to fines and even sanctions, it’s wise to have declarations verified by a licensed customs broker who is 100% focused on the task.
Perhaps the biggest benefit of outsourcing customs brokerage services is that it lets you focus your time and energy on your core business. By delegating customs clearance tasks to an expert broker, you free up your time for other aspects of your import/export operations, like building stronger relationships with suppliers and customers.
The fee a customs broker charges varies with the size and complexity of the work it performs. For the simplest entry and ISF filing – say, one that includes up to three HS codes or three commercial invoices with one HS code – you’ll pay about $175. If the broker needs to file data for one or more regulatory agencies, that could add $30 or $40 per agency to the bill.
In exchange, you get a professional service that processes a Customs entry in minutes, rather than the hours or even days it might take an inexperienced importer. The broker submits those filings electronically, helping to ensure that Customs will get them on time. Because it knows the process well, a customs broker reduces the risk of errors that could otherwise delay your shipment and increase your costs.
You’ll also have a much easier time securing bonds when you work with a broker. Surety companies prefer to work with customs brokers or freight forwarders. Unless you, as an importer, can offer a great deal of ongoing business, most sureties will refuse to work with you directly.
Customs brokers may charge for services in various ways:
Every company that offers customs brokerage services must have at least one person on staff who holds a customs broker license. Other employees can perform data entry and similar services for clients, but the licensed broker must oversee their work.
If you’re evaluating partners for customs brokerage services, look for people/firms with the following characteristics:
Word of mouth is a good way to locate a reliable customs broker. Your freight forwarder or NVOCC might also provide a referral. In fact, if your forwarder has its own close relationship with a reliable customs clearance agent, as I.C.E. Transport does, you won’t need to search for a broker or worry about the day-to-day details of the import process. The forwarder and its trusted partner will manage the whole process seamlessly.
The pivotal role of a customs broker in facilitating international trade cannot be overstated. By meticulously navigating the labyrinth of customs regulations, overseeing clearance processes, and offering invaluable guidance to businesses, they serve as the linchpin for seamless global trade.
Success in this role demands a unique blend of expertise encompassing customs regulations, keen attention to detail, effective communication, analytical prowess, and adept problem-solving skills. Further, a background steeped in international trade, logistics, or related disciplines, coupled with proficiency in the right software tools, confers a distinct advantage.
Looking for advice on how to arrange for efficient, worry-free customs clearance? Contact I.C.E. Transport to learn more.