The role of a Customs Broker in international business

A Customs Broker is a person licensed by the country’s Customs to act on behalf of an importer or exporter to clear goods through customs. In the USA, the US Customs and Border Protection is the licensing entity and activity is named Customs House Broker (CHB).

The acting universe of a customs broker can be vast and variable. Aside from being an intermediary between an exporter or importer and a government entity, he or she executes tasks of preparation, signing and submission of documents, classification or valuation of goods, calculation and payment of duties and fees, export registration, import permits, preparation and issuing of certificates, explanation of customs laws and regulations, transactions revision to ensure compliance, among others.

The activities of a customs broker demand great qualification and knowledge: brokers may be responsible for compliance with trade laws and regulations; about trade agreements or programs; classification codes; temporary imports or exports; drawback eligibility; cross border transactions; deal with abandoned cargoes; cargo loss and damage; record keeping of documents and powers of attorney; participate on surveys; report violations and penalties all on behalf of the party represented.

In many situations the professional customs broker advises exporters and importers on various matters as he/she has enough knowledge and experience accumulated to do so. Among those are: product classification, guidance about rules and procedures to export or import, price or cost composition to export and import, suggestion of transport mode to be used or its contracting, demurrage control, shipment follow up, insurance contracting, etc, etc.

The customs broker activity has different names in different countries. In some countries the license or the professional activity is mandatory and in others not.  What is noted is the knowledge and specialization of the customs broker is very important as they generate speed and assertiveness to the export and import processes. With profound knowledge, he or she is able to perform the required activities, guide the exporter or importer to fulfill the process correctly to get access to fiscal or tax benefits and avoid incurring in penalties or costs due to procedural errors.

Many logistics and foreign trade service providers offer a range of services to the importer and exporter advising them from start to finish of a process with cross-functional teams where the customs broker is just one of them. With the exception of representation before government agencies, other activities may also be exercised by other professionals.

In that regard, are widely spread the Freight Forwarders and NVOCC’s (Non Vessel Operating Common Carriers). In general terms, Freight forwarders, take care of the logistics, packaging, to move the cargo from origin to destination handling the documents of the process within a given country or cross borders. Different from the NVOCC, the freight forwarder does not issue transport documents. Therefore it is said the NVOCC is a carrier for a shipper and a shipper for a carrier. Issuing its own transport document, the House Bill of Lading or House Airway Bill, the NVOCC takes on liability for losses and damages within the same rules set forth by his contracted carrier.

Freight Forwarders and NVOCC’s are a theme for yet another text.

Clara Rejane Scholes, Intradebook.

7 Responses to “The role of a Customs Broker in international business

  • Your informative article about customs brokers is rather interesting, especially at the part where they should not only know of the legalities of trading but also of the laws about trading certain products. If I were to have an item delivered through barge, I will enlist a professional to have the legal documents ready beforehand. Doing so will show professionalism and respect to the government my business is under.

  • Thank you for your comments, Mr. Tim Yaotome. Your observation is very important. We hope to have you always accompanying us here. Kind regards. Alfredo Kleper Lavor

  • Thank you for explaining how a customs broker’s roles can be vast and variable. My friend was telling me about some of the things he does as a customs broker and I was curious about what else they do. It is interesting to think how much they can do to make importing and exporting effective.

  • Thanks, Mr. Gift.

  • Excellent share! Thank you! Your insights are very valuable

  • Thank you very much, Gumruk.
    Our purpose is to facilitate the international business in the world.
    Try to know our platform:
    Best Regards,
    Alfredo Kleper Lavor

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