BY ANDREW M. DANAS
WHAT TO KNOW WHEN WORKING WITH CUSTOMS BROKERS
any parcel shippers find that using a licensed customs broker is essential when making international shipments, since every cross-border shipment is both an import and export transaction involving two different governments. Many parcel shippers, especially those just venturing into international trade, may also engage the services of a customs broker without a full understanding of the legal role of the customs broker and the parcel shipper’s legal obligations to the government as the party actually responsible for the import or export transaction. Customs brokers are licensed by US Customs and Border Protection (CBP) to transact “customs business” on behalf of others (19 U.S.C. §1641). Their licensing and performance of services are subject to CBP regulation (19 CFR Part 111). A licensed customs broker can provide advice on what documents are required to clear merchandise through
customs; how to determine the country of origin and the proper classification of the merchandise under the Harmonized Tariff System (HTS); and how to calculate the valuation and amount of taxes and duties owed on the import. They can advise on other laws and regulations that may apply to the importation and exportation of the shippers’ goods. They can also assist in the preparation and filing of required documents and engage in communications with government agencies on behalf of their client as the entry is processed. However, the fact that the customs broker can and does provide such advice and services does not mean that using a customs broker is an alternative to the parcel shipper’s own legal obligations to know and comply with the laws governing its international shipment. Understanding the legal framework that governs both the importer and the customs broker is essential to effectively working with a customs broker. US import-export regulations set the legal framework for the relationship, but the relationship will
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also usually be supplemented by the contractual terms and conditions that customs brokers frequently include in their Power of Attorney (POA). US customs law is based on a shared responsibility regulatory compliance system imposing a duty of “Reasonable Care” upon the importer, 19 U.S.C. §1484, combined with an obligation of CBP to provide information to the trade community to assist importers in complying with the laws. “Reasonable Care,” combined with “Informed Compliance,” imposes on the importer of record a legal obligation to file an entry of merchandise with accurate information to determine its classification and the amount of duties, taxes, and fees to be paid by the importer and to thus allow Customs to admit and release the merchandise into the United States. While consulting with a customs broker may be one factor that Customs will consider in determining whether an importer has exercised reasonable care, it is not the only factor.