The Different Types Of Customs Clearance Processes: A Focus On The Eu And Usa

General Customs Clearance Process:

The general customs clearance process involves a series of steps that need to be followed for importing or exporting goods. These steps typically include:

a) Documentation: Importers and exporters must prepare and submit necessary documents such as commercial invoices, packing lists, bills of lading/airway bills, and customs declarations. These documents provide details about the goods being shipped, their value, origin, and other relevant information.

b) Customs Declaration: The customs declaration form is a key document that provides comprehensive information about the imported or exported goods. It includes details like the description of goods, quantity, value, country of origin, and harmonized system (HS) codes, which classify products for customs purposes.

c) Duties and Taxes: Customs authorities assess duties and taxes based on the declared value and applicable tariff rates. Importers are required to pay these fees to clear their goods through customs.

d) Inspection and Examination: Customs officials may conduct physical inspections or document-based examinations to verify the accuracy of the declared information. This step aims to prevent smuggling, and counterfeit goods, and ensure compliance with regulations.

e) Release and Delivery: Upon successful completion of customs clearance, the goods are released to the importer or exporter for further transportation or delivery.

EU Customs Clearance Process:

In the EU, customs clearance is facilitated by the Union Customs Code (UCC), which governs the movement of goods within the EU member states. The key features of the EU customs clearance process include:

a) Single Market: The EU operates as a single market, enabling the free movement of goods within its member states. Customs duties and most internal border controls have been eliminated, streamlining the customs clearance process.

b) Import Control System (ICS): The ICS requires importers to submit electronic entry summary declarations prior to the arrival of goods. This system enables customs authorities to perform risk assessments and target high-risk shipments for inspection.

c) Authorized Economic Operator (AEO): AEO status is granted to businesses that meet certain criteria, such as having a strong compliance record and adequate security measures. AEO-certified companies receive benefits, such as simplified customs procedures and reduced customs controls.

d) VAT and Intrastat Reporting: In addition to customs duties, importers and exporters must comply with value-added tax (VAT) regulations. Intrastat reporting is also mandatory for businesses exceeding certain thresholds in intra-EU trade, providing statistical information on goods traded between EU member states.

US Customs Clearance Process:

In the USA, customs clearance is overseen by the U.S. Customs and Border Protection (CBP) agency. Key aspects of the US customs clearance process include:

a) Automated Commercial Environment (ACE): ACE is the electronic system used by importers, exporters, and customs brokers to submit required documentation, such as the electronic manifest and entry summaries. This system streamlines data processing and enhances transparency.

b) Harmonized Tariff Schedule (HTS): The HTS is used to classify imported goods and determine applicable duty rates. Importers must correctly classify their goods based on the HTS to ensure an accurate assessment of duties and taxes.

c) Customs-Trade Partnership Against Terrorism (C-TPAT): C-TPAT is a voluntary program that promotes supply chain security. Companies that meet specific security criteria are granted C-TPAT certification, which expedites customs clearance and reduces inspections.

d) Automated Commercial System (ACS): The ACS is a legacy system being phased out in favor of ACE. It handles various processes related to customs clearance, including entry processing, duty calculations, and post-entry amendments.

Useful Sites

European Union:

European Commission - Taxation and Customs Union:

Website: https://ec.europa.eu/taxation_customs/index_en

European Union Customs Code (UCC):

Website: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32013R0952

Import Control System (ICS):

Website: https://ec.europa.eu/taxation_customs/business/customs-controls/import-control-system-ics_en

United States:

U.S. Customs and Border Protection (CBP):

Website: https://www.cbp.gov/

Automated Commercial Environment (ACE):

Website: https://www.cbp.gov/trade/automated

Harmonized Tariff Schedule (HTS):

Website: https://hts.usitc.gov/current

Customs-Trade Partnership Against Terrorism (C-TPAT):

Website: https://www.cbp.gov/trade/programs-administration/customs-trade-partnership-against-terrorism