Perhaps the most daunting part of the export process is customs clearance. From ensuring your exports are classified correctly and having the right documentation, to complying with physical and legal requirements, the clearance process can be infuriatingly burdensome. The devil is in the details, after all.
Thankfully, there are intermediary professionals whose talents lie in supervising the clearance process by helping businesses comply with customs restrictions. These individuals are known as Customs Brokers.
“Moving Parts” is back with its fifth installment! This series from the NDTO discusses the many individuals and organizations that make international trade possible. When it comes to perhaps the most frustrating part of exporting, Customs Brokers do most of the heavy lifting.
Customs Brokers: What They Do1
The role customs brokers play in the export process can sound quite similar to that of freight forwarders. However, their expertise differs in that freight forwarders focus on the logistics of transporting goods from one country to another while customs brokers focus on compliance. Freight forwarders can’t do their jobs until customs brokers give them the go-ahead.
What does customs compliance look like?
- Correct Classification of Goods
Classifying your goods with the right HS code doesn’t sound difficult, but revisions and regulations are constantly being made. Customs brokers have a wealth of knowledge regarding classification and stay informed on re-classification statuses.
- Tariff Calculation
Customs brokers are responsible for ensuring all fees, taxes, and regulatory transactions have been budgeted and paid for during the export process. They also know how to minimize the financial burden of tariffs through negotiation and legal alternatives.
- Documentation and Record-Keeping
Those pesky, long, technical documents that are necessary for approval can get in the way of a seamless export plan. Thankfully, customs brokers take care of them. From bills of lading to certificates or origin, they have an acute understanding of the information that must be provided. Documentation also includes record-keeping and managing potential audit materials.
- Valuation Assistance
Customs brokers can aid in determining the net value of a business’s goods after factoring in all the various expenses and profits. This prevents financial losses or inaccuracies amongst accounting records.
Common Mistakes
There are a multitude of errors customs brokers prevent to save your business time, money, and guarantee your product arrives at its final destination without issue.
These include:
- Missing, Incomplete, or Inaccurate Documentation: Being unprepared with the paperwork necessary for compliance, customs clearance, and proper service.
- Incorrect Tariff Classification: Falsely or inaccurately labelling goods being exported and delaying their delivery.
- Under or Overvaluation: Incorrectly valuing your goods. The value of your goods affects your “duties”—fees and taxes imposed by customs, world governments, and more.
North Dakota Resources
There are a number of custom broker agencies in Fargo, ND that you can contact for help with documentation, valuation, and more. There are also online agencies that can handle a lot of the work remotely. If you’re curious about our state’s customs regulations and processes, you can contact the U.S. Customs and Border Protection (CBP) offices located throughout ND.
The NDTO is always here if you have any lingering questions or concerns. Never hesitate to give us a call!