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A Customs Broker helps companies and individuals import goods into the US in a variety of ways. Much like a lawyer represents a client in a court of law, a Customs Broker works with Customs and all Partner Government Agencies on your behalf, the Importer of Record. The rules that these government agencies have in place are complex and change often. An experienced Customs Broker stays on top of the rules, and assures you all the work they conduct on your behalf with the government agencies are in accordance with Customs Law.
What Does A Customs Broker Do?
The initial service offering of a Customs Broker was to file an entry declaration on behalf of their clients. Nowadays our service offerings can include:
Possibly. It depends on what you are importing and the value of the goods. Let’s start with the value of the goods.
For goods with a value of $2500 USD or less, you can self declare the goods on a section 321B entry type if you are accompanying the goods across the border. This type of entry does not require a customs broker.
For goods with a value greater than $2500 USD, a customs broker is required to submit a formal entry to US Customs and Border Protection on your behalf.
Some commodities, regardless of value, require a formal entry into the US. For example, goods with anti-dumping, countervailing or permit requirements require a Customs Broker to file the formal entry with US Customs on your behalf.
Working with a Customs Broker benefits importers in the following ways:
It is important to remember that importing into the US is a privilege that can be revoked based on the importer’s level of compliance. Working with a knowledgeable party that can help you avoid monetary penalty, delay and revocation of importing privileges will help your trade endeavors in the long run.
Ready to create an account with us? Get started here. How Much Does A Customs Broker Charge?Each Customs Broker has its own set of service rates.
If you were to import with us, our rates depend on the specifics of your import.
The price you will pay is determined by the:
Yes, there are some. Every commodity imported into the US is regulated by US Customs and Border Protection and possibly a Partner Government Agency (PGA) that specializes in that commodity type. For example, if you want to import seafood, CBP and the FDA would review your import declaration to determine their ‘release decision.’ Specific details about your seafood are required to be included in your import declaration. These elements are used to make the release decision as to whether the seafood will be allowed in the country or not.
Very few commodities are outright banned from entering the US. Some examples of banned goods are those sanctioned from Iraq. Other common examples are drugs such as marijuana, even though they may be legal in some states, they are still illegal federally.
It is very important to ensure that you understand what data is required for your specific commodity, what documents and interfaces that data needs to be reported in and the timeframes for reporting in order to provide Customs and PGA the data they need to make a release decision.
Here is how you calculate duty rate payable to Customs:
Value of goods (USD)
x Duty rate associated with tariff classification (commodity specific)
- Any preferential tariff treatments
= Duty payable to Customs
To determine your rate of duty, you will need to analyze three things:
If you need help with any of these three topics an experienced Trade Advisor can help you.
Work With A Trade Advisor To Calculate Your Duty Rate How Do I Value My Goods For Customs Purposes?There are six methods of valuation Customs allows to value goods.
How Do I Determine My Tariff Classification?You determine your tariff classification by seeking help or referencing the tariff book yourself. Since an HS Tariff Classification code is required on your import declaration to identify the goods being imported, it is important that you know the tariff code for each of your commodities.
Tariff classification is seemingly easy but in reality can be quite difficult depending on the commodity. Many new importers think it is as easy as looking up their commodity and using the corresponding duty rate. However, without using the explanatory notes from each chapter, importers could assign an incorrect tariff, and therefore use an incorrect rate of duty to potentially and unintentionally be underpaying or overpaying duty. If this goes uncaught, it could result in hefty monetary penalties.
Using the expertise of a Trade Advisor To Determine Your Tariff or Taking A Course on how to assign one is beneficial for you to stay compliant with Customs.
What Shipment Documentation Do I Need To Send To Customs?When importing goods into the US, there are specific forms that are required by US Customs and Border Protection (CBP) when presenting the entry information. These forms are intended to provide all necessary information to various Partner Government Agencies (PGAs). The forms are as follows:
US Customs Invoice (USCI)
Every shipment needs to be accompanied by an invoice that has specific data about the goods. This invoice is provided to the customs broker, so they can pull the information off of it in order to make the declaration to Customs, and your carrier, to make an eManifest and to present to a Customs office at the first port of entry.
At minimum, goods not regulated by a Partner Government Agency need to include the information listed in this guide.
For goods regulated by any of the Partner Government Agencies, the information listed in the guide linked above is required along with additional data elements specifically for the PGA.
Free Trade Agreement Certificate of Origin (FTA Certificate)
Goods meeting the eligibility rules of the USMCA and documented on the Certification of Origin, receive a reduced (free) rate of duty. This certification can be completed for each shipment or once each calendar year. For further information on this topic, contact our Client Services Team or our learning center for upcoming and on-demand sessions.
An entry is a term used for the declaration process required for goods that an Importer of Record is requesting to import into the US. There is a specific entry type for each import circumstance.
Entry For Consumption
Consumption entries are for goods entering the country that are not intended to leave again, but rather be consumed entirely. A good example of this is food.
A consumption entry follows a two-part process:
Both of these processes can be accomplished electronically.
Examples of consumption entry types are:
Entry For Warehouse
As an importer of record, if you wish to postpone the release of goods, you may place them in a CBP bonded warehouse under a warehouse entry. The goods may remain in the bonded warehouse up to five years from the date of importation. At any time during that period, warehoused goods may be re-exported without paying duty, or they may be withdrawn from the warehouse for consumption upon paying duty at the duty rate in effect on the date of withdrawal. If the goods are destroyed under CBP supervision, no duty is payable.
While the goods are in the bonded warehouse, they may, under CBP supervision, be manipulated by cleaning, sorting, repacking, or otherwise changing their condition by processes that do not amount to manufacturing. After manipulation, and within the warehousing period, the goods may be exported without the payment of duty, or they may be withdrawn for consumption upon payment of duty at the rate applicable to the goods in their manipulated condition at the time of withdrawal. Perishable goods, explosive substances, or prohibited importations may not be placed in a bonded warehouse. Certain restricted articles, though not allowed release from custody, may be warehoused.
Temporary Importation Under Bond (TIB)
Goods of the types, when not imported for sale or for sale on approval, may be admitted into the US under bond without the payment of duty for exportation within one year from the date of importation. Generally, the amount of the bond is double the estimated duties. The one year period for exportation may, upon application to the port director, be extended for one or more further periods which when added to the initial one year shall not exceed a total of three years. There is an exception in the case of articles covered in item 14: the period of the bond may not exceed six months and may not be extended.
Merchandise entered under TIB must be exported or destroyed before expiration of the bond period or any extension to avoid assessment of liquidated damages in the amount of the bond. All goods entered under TIB are subject to quota compliance.
What Is Customs Compliance?Due to recent world events, international trade has been subject to a host of threats and hazards such as natural disasters, accidents, or even malicious attacks. The growing risks and complexities of global trade have caused governments around the world to place stronger emphasis on cross-border security.
While new regulations and a focus on security has helped create a safer trade environment, it has also resulted in tighter processing times, increased audits, compliance activity, and greater costs to importing goods.
In recent years, US Customs and Border Protection has shifted much of their emphasis from import inspections to post-audit verifications. The responsibilities put upon Importers of Record has steadily increased as all members of the supply chain endure higher scrutiny from customs officials. Now more than ever it is imperative that the Importer of Record maintain a high level of sophistication, demonstrate due diligence, ensure their responsibilities are understood, implement internal sets of controls and procedures for best practices as well as understand the consequences of non-compliance.
The consequences of failing to comply with customs regulations include:
The current regulatory environment demands active participation by every member of the international trade community. The laws governing cross-border trade continue to become increasingly complex, and this requires ongoing, continuous improvement in voluntary compliance through awareness and education.