Just What Does a Customs Broker Really Do?

Buying and selling across international borders is not as simple as placing an order online and waiting for the post office to deliver it. Cross-border trade involves a litany of complex rules, regulations, duties, tariffs, …

Customs-Broker

Buying and selling across international borders is not as simple as placing an order online and waiting for the post office to deliver it. Cross-border trade involves a litany of complex rules, regulations, duties, tariffs, etc. And with so many countries now involved in international trade, the rules governing imports and exports get more complicated by the day. Enter customs brokers.

As a company looking to import goods, how do you intend to maintain trade compliance? More importantly, do you even know what is expected of you as an importer of record (IOR)? Rest assured that U.S. Customs and Border Protection (CBP) will not accept ignorance as a reasonable excuse for not being compliant.

Vigilant Global Trade Services recommends that importers work with global trade service providers capable of helping them navigate the complex waters of international imports. And if not a company providing full-service, importers should at least consider working with a customs broker.

  1. A Basic Definition

Under U.S. trade law, an IOR is the party ultimately responsible for ensuring that trade compliance is maintained on all imported goods. An IOR can be a buyer, a buyer’s agent, a distributor, or even an individual. IORs can handle compliance issues on their own or contract with customs brokers to work on their behalf.

A customs broker is essentially an agent of the IOR. As an agent, the broker has the legal authority to act on the IOR’s behalf. This includes fulfilling all the duties the IOR would otherwise fulfill on its own. At the end of the day though, it is still on the IOR to make sure that its customs broker has done everything it is supposed to do – and done it correctly.

  1. Daily Customs Broker Tasks

By now you might be wondering what a customs broker does on a daily basis. Fair enough. Let us start with paperwork. There is a tremendous amount of it involved whenever an IOR is bringing goods into the country. A customs broker handles all that paperwork on behalf of the IOR.

A customs broker will complete and submit the necessary cargo control documents. It will obtain any necessary permits. A customs broker will even handle invoicing if necessary. If there is paperwork involved, the customs broker can likely handle it.

Calculating Duties and Tariffs

The primary motivation behind trade compliance is to guarantee that import duties and tariffs are paid. A customs broker will calculate those duties and tariffs, then work with the IOR to ensure they are paid. Shipments can only be released by CBP when all payments are up to date.

Clearing Goods through Customs

Importers are subject to other requirements in order to clear customs. Again, a customs broker will handle those tasks. Whatever CBP requires for a particular shipment is taken care of.

Forwarding Shipments to Their Destinations

Once duties have been paid and customs cleared, shipments must get from warehouse to destination. Customs brokers can prove especially helpful in this regard by working with freight forwarders and carriers. In a nutshell, they make sure goods reach their eventual destinations in a timely manner.

Staying Abreast of Trade Regulations

Last but not least, a customs broker keeps up with changes in trade regulations on behalf of its clients. Customs brokers make modifications to policies and procedures, in accordance with changes, to ensure clients remain in compliance. In that sense, they act as a safeguard.

Trade compliance is a complex issue requiring both experience and knowledge. A good customs broker offers both. Working with a customs broker makes an IOR’s life a lot easier.

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