{"id":720,"date":"2022-12-06T02:08:31","date_gmt":"2022-12-05T17:38:31","guid":{"rendered":"https:\/\/lkylog.com\/?p=720"},"modified":"2024-01-10T16:19:46","modified_gmt":"2024-01-10T07:49:46","slug":"customs-clearance-process","status":"publish","type":"post","link":"https:\/\/lkylog.com\/customs-clearance-process\/","title":{"rendered":"What Is Customs Clearance Process and How to Make It Easier"},"content":{"rendered":"\n<p>As a business person with plans to make international shipments, you&#8217;ll have to familiarize yourself with the customs clearance process. Whenever you have to move goods from one country to another, they must pass through the customs clearance office for approval by a customs officer.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"1000\" height=\"450\" src=\"https:\/\/lkylog.com\/wp-content\/uploads\/2022\/12\/Customs-Clearance-Completed.jpg\" alt=\"Customs Clearance Completed\" class=\"wp-image-1130\"\/><\/figure>\n\n\n\n<p>For international shipments, all goods must go through customs clearance before being allowed into the importing country. In addition, the shipper has to go through the customs clearance in the exporting country before the cargo is allowed to leave.<\/p>\n\n\n\n<p>During the clearance process, you&#8217;ll be required to produce customs documentation that includes the following:<\/p>\n\n\n\n<ul>\n<li>Commercial invoice<\/li>\n\n\n\n<li>Packing list<\/li>\n<\/ul>\n\n\n\n<p>All the documents mentioned must be produced, as are any other documents that the customs officers might request.<\/p>\n\n\n\n<p>In addition, every country imposes import duties and taxes based on their policies and international trade laws. The customs duties and taxes are essential for the economic stability and growth of the country.&nbsp;<\/p>\n\n\n\n<p>As an international shipper, you must familiarize yourself with the customs duties and regulations of importation of the countries you&#8217;ll be shipping from.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What&#8217;s Customs Clearance?<\/strong><\/h2>\n\n\n\n<p>Shippers undertake this process in international shipments to enable products to move from one country to another through its borders. When preparing to leave, the freight forwarder or shipper has to go to the customs authorities with all documentation. The requirements and process can be different from one country to another because of differences in policies.<\/p>\n\n\n\n<p>In addition, customs clearance is a document presented to the freight forwarder or shipper by the customs officer indicating that the freight has been approved. The customs clearance document should indicate that the freight forwarder has paid all the customs duties and taxes and the cargo has been approved for shipping.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Customs Clearance Fees<\/strong><\/h2>\n\n\n\n<p>Customs authorities require you to pay some fees to get customs clearance. The prices are different in all countries, and you can research the possible charges imposed by the countries you&#8217;ll be exporting and importing to. The customs clearance fees include the following:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Import Duties<\/strong><\/h3>\n\n\n\n<p>The importing country imposes import duties and taxes based on their internal policies on importation. The import duties and taxes can differ depending on the cargo type, the value of goods, and the shipment size.<\/p>\n\n\n\n<p>The purpose of imposing import duties during the clearance process is to control the goods getting into a country from other countries and maintain competitiveness.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Export Duties<\/strong><\/h3>\n\n\n\n<p>Export duties and taxes are rare in most countries because they can be counter-productive. This is because shippers would rather stay away from countries that charge them a fee to purchase their products.<\/p>\n\n\n\n<p>An exporting country can still charge duties and taxes to increase its profits or make the products scarce. If a product is deficient in the market, the demand will increase, and the exporting country can raise the price.<\/p>\n\n\n\n<p>Therefore, you must research whether the exporting countries charge duties and taxes on the products you&#8217;re about to ship.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Tariffs<\/strong><\/h3>\n\n\n\n<p>As a shipper, you might also be required to pay tariffs before being cleared by a customs officer. Some of the tariffs include the following:<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Ad valorem<\/strong><\/h4>\n\n\n\n<p>The government can impose a tax percentage on an international shipment that depends on the value of the cargo. This means that the value of the goods determines how much you get charged in tariffs.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Compound tariffs<\/strong><\/h4>\n\n\n\n<p>The government agency can create a minimum and maximum limit on tariffs where the charges are specific for a certain category. For instance, the tariff may be set at 4% for $USD10\/lb.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Specific tariffs<\/strong><\/h4>\n\n\n\n<p>The government agency can also fix a monetary charge on the quantity or weight of cargo. For example, the specific tariff can be $USD 1\/LB.<\/p>\n\n\n\n<p>For smooth customs clearance, ensure that your cargo is in the correct cargo classification and all documents have been efficiently filed.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Customs Clearance Documents<\/strong><\/h2>\n\n\n\n<p>When going to the customs office, you should ensure that the customs declaration documents are available and duly filled. The customs declaration form should contain a list of all the products in the cargo. The following documents should also be present:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Commercial Invoice<\/strong><\/h3>\n\n\n\n<p>A commercial invoice indicates that a seller and buyer transaction is complete. You should ensure that the invoice has all the crucial information and that the products have been properly serialized. Further, you can replace the invoice with a customs invoice.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh6.googleusercontent.com\/oo_L7XTZ0XLm8AR61IkYxvEXN8FHOk5_N5a7HdheRj6lttNbq2wdOO3DgZHPvlncKnxPvWM5fJ_tULvuO5k5-ODsEOj22jxG5BCq47rW2preOJGuql52f764ls3yFfnbbQ2HuQDQ76-U2s7WSSMOUOsB7_8E40Yr5f91bOzlfIaZf-dgGlDR6X3rng6qHA\" alt=\"tax office, accounting, invoice\"\/><\/figure>\n\n\n\n<p>Some of the information contained in a commercial invoice includes the following:<\/p>\n\n\n\n<ul>\n<li>Your details, including name and address<\/li>\n\n\n\n<li>The details of the person receiving the shipment<\/li>\n\n\n\n<li>Location of shipment destination<\/li>\n\n\n\n<li>Shipper&#8217;s reference number<\/li>\n\n\n\n<li>The unit price of the cargo<\/li>\n\n\n\n<li>Measurement unit<\/li>\n\n\n\n<li>A detailed description of the cargo<\/li>\n\n\n\n<li>The cargo volume and weight<\/li>\n\n\n\n<li>Conditions of sale of goods<\/li>\n\n\n\n<li>Payment terms for the goods<\/li>\n\n\n\n<li>The serial number and date of the invoice<\/li>\n\n\n\n<li>The preferred currency for the transaction<\/li>\n\n\n\n<li>The commercial value of the invoice<\/li>\n\n\n\n<li>The overall cost of the cargo<\/li>\n\n\n\n<li>The total shipping costs<\/li>\n\n\n\n<li>Details of cargo insurance<\/li>\n\n\n\n<li>Information on any taxation made and receipts, where possible<\/li>\n\n\n\n<li>The incoterms agreed on by both parties<\/li>\n\n\n\n<li>The method of shipping the cargo<\/li>\n\n\n\n<li>The necessary certifications<\/li>\n\n\n\n<li>Any extra charges imposed on the cargo shipment<\/li>\n\n\n\n<li>Package marks<\/li>\n<\/ul>\n\n\n\n<p>During customs document inspection, the customs officials ensure that all the details in the commercial invoice match the contents of the cargo before issuing the clearance.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Export And Import License<\/strong><\/h3>\n\n\n\n<p>You&#8217;ll need an export and import license to move cargo from one country to another successfully. In some cases, the license might not be mandatory. You can talk to a customs broker to determine whether your cargo needs an export and import license. One of the ways for you to know if the cargo requires a permit to be exported or imported is by checking if it&#8217;s prohibited.&nbsp;<\/p>\n\n\n\n<p>In addition, you&#8217;ll have to pay a fee for the license. The fee payable depends on customs regulations. Further, you must get a license from both countries before starting the shipping process.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Packing List<\/strong><\/h3>\n\n\n\n<p>If you want a smooth customs process, it&#8217;s best to have a detailed packing list that provides all the items in a shipment. The shipping company should list everything on the load and stick the list on the cargo. This makes it easy for the customs agent to check the list while comparing the items with what&#8217;s in the shipment. Furthermore, the list must be with the cargo up to the destination country to keep track of everything.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Country Of Origin<\/strong><\/h3>\n\n\n\n<p>To ship internationally, you might be required to produce this document at the customs office. The country of origin document is issued by the exporting country and indicates that they manufacture the product or goods.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Proforma Invoice<\/strong><\/h3>\n\n\n\n<p>As a seller, once you&#8217;ve confirmed a transaction with the buyer, you&#8217;ll send them a proforma invoice. Ideally, the proforma invoice acts as an agreement between the parties and is used in some countries in place of a commercial invoice. In such cases, the customs agents can use the proforma invoice for tax and duty calculation. Nonetheless, ensure that you&#8217;ve spoken to a customs broker to decide if the proforma invoice is necessary and if the target countries would accept it as a substitute for the commercial invoice.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Shipping Bill<\/strong><\/h3>\n\n\n\n<p>During the customs clearance process, customs officials must assess the value of the exported cargo. The assessment is made using the shipping bill. Once your ship gets customs clearance to leave the exporting country, a customs officer files the shipping bill.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Consular Invoice<\/strong><\/h3>\n\n\n\n<p>You can get this invoice from the consulate in the importing country. The purpose of a consular invoice is the same as that of a commercial invoice. The downside to using a consular invoice is the customs charges which are higher than the commercial invoice.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>CN22 And CN23 Forms<\/strong><\/h3>\n\n\n\n<p>If you&#8217;re exporting cargo from a country in the European Union (EU) region, you must produce the CN22 and CN23 forms. The specific form you have to fill out depends on the value and weight of the cargo.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Bill Of Lading<\/strong><\/h3>\n\n\n\n<p>This is a receipt issued by the vessel owner or captain responsible for your cargo freight. The documents list all shipped items and are presented to a customs agent for inspection and clearance.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Bill Of Entry<\/strong><\/h3>\n\n\n\n<p>Once you&#8217;ve hired a customs broker, they&#8217;re responsible for filing a bill of entry before the shipments arrive at the port. Ideally, the bill of entry is essential to the clearance process and must be presented before the customs office can evaluate your shipment.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Cargo Insurance<\/strong><\/h3>\n\n\n\n<p>If you&#8217;ve bought cargo insurance, you&#8217;ll have to present the documentation to the customs office during the clearance process. The insurance receipts are crucial in determining the import duty due. Nonetheless, the cargo insurance documents wouldn&#8217;t be required if you&#8217;ve opted not to cover your cargo from loss and damage.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Customs Clearance Process<\/strong><\/h2>\n\n\n\n<p>There are several steps in the customs clearance process. While most steps can remain the same for most cargo types, there can be disparities depending on the type of goods you&#8217;re shipping. In addition, the process can be affected by the mode of shipping you select for your cargo. Here are the common steps in the customs clearance process:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Document Inspection<\/strong><\/h3>\n\n\n\n<p>The customs officer shall request that you produce all the above documents at this stage. The customs agent then checks the documents and verifies the information provided. In addition, the customs officer will check if the documents are complete and accurate. To avoid any setbacks during the customs document inspection, you can hire a customs broker to review the documents before presenting them to the customs office.&nbsp;<\/p>\n\n\n\n<p>The commercial invoice is the most important document you must ensure is available and properly filled. This document provides the details of the shipper, buyer, vessel number, and export date. These details are critical in getting approval to export. The customs clearance process can only begin if the documents are in order.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Tax And Duty Calculation<\/strong><\/h3>\n\n\n\n<p>The customs officer shall use the documents you&#8217;ve provided, such as invoices, to calculate duties and tax. The duties and taxes imposed on goods differ depending on the type, weight, volume, value, and customs laws. The calculations are made based on the established standards for import duties. The assessment and calculation of taxes can be a hectic process, and it&#8217;d help if you sought the services of a customs brokerage firm.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Taxes And Duties Payment And Incoterms Choice<\/strong><\/h3>\n\n\n\n<p>Once the tax and duty calculation has been done, you&#8217;re presented with the total fee you&#8217;re expected to pay. The customs officer shall refer and verify the payment if you&#8217;ve already paid the taxes and duties. In addition, if you&#8217;re shipping restricted goods, you might incur extra charges. You can choose between the following payment methods for duties and taxes:<\/p>\n\n\n\n<ul>\n<li>Deliver Duty Unpaid (DDU): This is where you have unpaid duties and taxes. The customs agent forwards your shipment details to an independent customs broker who&#8217;ll collect the amount owed.<\/li>\n\n\n\n<li>Delivered Duty Paid (DDP): The duties and taxes, in this case, are paid. This is a preferred payment method by most express courier service providers. In this payment method, the duties and taxes are collected by customs brokers on behalf of the customs department. This means that the shipping fees include import duties and taxes. If you want a smooth shipping experience, it might be best to use the DDP method.&nbsp;&nbsp;<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Customs Clearance<\/strong><\/h3>\n\n\n\n<p>This is the final step once everything is cleared, including taxes. The customs office releases the shipment for delivery to the indicated destination. It&#8217;s easy to get cleared if you have all the documentation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Time Taken During Customs Clearance Process<\/strong><\/h2>\n\n\n\n<p>The customs clearance process should take a little time if your documents are accurate and complete. In addition, the time taken for customs clearance also depends on the countries involved. Therefore, you can take days, weeks, or months to go through the customs clearance process.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Cost Of Customs Clearance Process<\/strong><\/h2>\n\n\n\n<p>The customs clearance charge isn&#8217;t fixed and depends on several factors, such as modality and the speed of customs clearance. You can ask the customs officer about the average customs fees you&#8217;re required to pay. You can then pay customs charges and collect the receipt for documentation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How To Make The Clearance Process Easy<\/strong><\/h2>\n\n\n\n<p>Though there are four steps in the customs clearance process, it can be complex and stressful, especially if it&#8217;s your first time shipping. Here&#8217;s how you can make the process easier:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Ensure Your Paperwork Is Complete And Accurate<\/strong><\/h3>\n\n\n\n<p>Indiscrepancies in your paperwork can delay your customs clearance process. This is because the first step is document inspection, and the customs official focuses on ensuring that all the details are accurate. If the customs officers find the documents incomplete or inaccurate, the shipment won&#8217;t be cleared. This can be expensive to you as a shipper.<\/p>\n\n\n\n<p>Subsequently, if customs hold your goods as you await clearance, it&#8217;ll be costly because you have to pay holding charges. In addition, the delay can be expensive for your business. To be certain that your documents are up to the task, you can have a freight forwarder go through them before going to customs.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Hire A Professional Freight Forwarder<\/strong><\/h3>\n\n\n\n<p>There&#8217;s no doubt that the shipping process is complex, especially in a cross border shipment. To have an easy shipping experience, you can hire a freight forwarding company to handle the customs clearance process. The primary purpose of freight forwarders is to assist importers.<\/p>\n\n\n\n<p>Additionally, ensure that you enlist experienced freight forwarders because they know everything about customs procedures. Moreover, a professional can help reduce the overall shipping costs.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Be Aware That The Customs Clearance Process Occurs At Every Stopover<\/strong><\/h3>\n\n\n\n<p>In an international shipment where the vessel has to make several stopovers, it must go through customs clearance. You need to be aware of this to choose a convenient shipping method. For example, while a ship has to go through several customs departments, air freight only goes through customs in the destination country.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Understand International Laws And Customs Regulations<\/strong><\/h3>\n\n\n\n<p>As an international shipper, it&#8217;s essential to have basic knowledge of international laws and customs regulations. In addition, you must understand that these can change at any moment and affect your customs clearance process. Therefore, it&#8217;ll be best to stay ahead of any changes in laws and regulations to avoid inconveniences.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Attach Documents To The Cargo<\/strong><\/h3>\n\n\n\n<p>Ensure that the packing list, bill of lading, and invoices are attached to the cargo for accessibility during inspections. The customs official checking your shipment would easily verify and check your load if all the essential documents are attached. In addition, the documents can help with tracking the goods throughout the shipping process.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Pack The Cargo Correctly<\/strong><\/h3>\n\n\n\n<p>The customs clearance process will be hectic if the cargo is packed incorrectly. This is because inspecting and clearing the shipment will take a long time. Thus, incorrectly packing the load for shipping would delay shipping and likely be costly. Moreover, properly packing your cargo ensures it&#8217;s safe during the freight.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Types Of Customs Clearance Process<\/strong><\/h2>\n\n\n\n<p>There are several types of customs clearance processes, including the following:<\/p>\n\n\n\n<p><strong>General customs clearance: <\/strong>This is the process explained above in this article, and the documents and cargo are assessed normally.<\/p>\n\n\n\n<p><strong>Anticipated (pre-arrival) customs clearance: <\/strong>The customs clearance process can begin before the shipment arrives at the customs office. In this case, you can send physical or digital documents ahead for approval before the cargo arrives. However, in this case, the documents must be accurate, and any information must be availed when requested.<\/p>\n\n\n\n<p><strong>Express customs clearance: <\/strong>This is the process made for the clearance of shipments that require immediate releases, such as perishable goods, cargo needed to save a life, high-value cargo such as precious stones, hazardous products, and live load.<\/p>\n\n\n\n<p><strong>Deferred clearance:<\/strong> This happens when the downloading date has already passed.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Conclusion<\/strong><\/h2>\n\n\n\n<p>Though the customs clearance process is hectic and sometimes complex, it&#8217;s mandatory in international shipping. If you aren&#8217;t familiar with the shipping process, hire a freight forwarding company to help with the customs clearance process. Ensure you&#8217;ve familiarized yourself with the customs clearance process and all the requirements for smooth sailing.&nbsp;<\/p>\n\n\n\n<p>Most importantly, make sure you have all the customs documents before starting the process. However, if you&#8217;re comfortable handling the process alone, we hope this article has been helpful.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>As a business person with plans to make international shipments, you&#8217;ll have to familiarize yourself with the customs clearance process. Whenever you have to move goods from one country to another, they must pass through the customs clearance office for approval by a customs officer. For international shipments, all goods must go through customs clearance [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":1129,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"Understanding the Customs Clearance Process for International Shipments","_seopress_titles_desc":"Navigate international shipments with ease by understanding the customs clearance process. 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