|Physically and legally transmitting goods from a the boundaries of a country or national territory.|
|Physically and legally transmitting goods into the boundary of a country or national territory.|
|Exportation from a customs territory of goods previously imported into that territory|
|A method of storing or transporting goods that have either already been exported from an national territory, or have yet to be imported. The warehouse or truck are "international grounds."|
|The act of lawfully importing goods through a recognized recognised import authority.|
|Any third party who works on behalf of a contracting party. Most common in customs clearance are "clearing agents" and "forwarding agents."|
|Cargo that is held up and unable to be imported to a country or territory for whatever reason.|
|Fees that accrue from cargo behind held pre-customs. Frustrated cargo can greatly increase demurrage fees.|
|The physical edge when entering or leaving a country or national territory.|
|The actual physical crossing point of a boundary.|
|Port of Entry||Port through which goods are imported.|
|The legally required fees charged by governments to import goods. Each country has vastly different regulations.|
|Exemption||When part or all of the import fees and / or process are exempted for specific goods or organizations, usually in response to extraordinary circumstances.|
Humanitarian organisations are sometimes at an advantage for the facilitation of customs clearance in emergencies; not only are registered non-profits frequently able to apply for some forms of tax or duty exemption in non-emergency settings, during emergency responses many import regulations on humanitarian responders are waived or loosened by the countries affected by disaster, or adjacent countries to the disaster. The United Nations often assumes the lead role in making appropriate arrangements with governments regarding quick access to emergency supplies as the physical flow of emergency relief is supplies is essential in the early days of response. The United Nations through the Office for the Coordination of Humanitarian Affairs (OCHA) has also developed a “Model Agreement” (approved by the Permanent Technical Committee in 1996) with the World Customs Organization Organisation (WCO). The Model Agreement can be adopted by any country, and lay the foundation for the process of exemptions, streamlining paperwork, pre-identification and expedited clearance of certain relief items, and overall smoothing of the import and export process. The Logistics Clusters on behalf of the UN Resident Coordinator (UNRC)/ UN Humanitarian Coordinator (UNHC) may try to leverage these advantages for all humanitarian organisations in an emergency.
Customs relates to both the import and export of material goods. Import and export were classically limited to the transmission of physical goods across a legally recognized recognised international boundary, however advances in technology and changes to trade policy have also grown to include – in some cases - the electronic transmission of electronic information such as proprietary software and even intellectual property such as manufacturing processes. Import is the transport of physical goods into the incorporated territory country, state, autonomous region, whereas export is the movement and shipment of goods out of said territory. To manage and oversee the legal and controlled import and export process, national authorities can and will identify and establish one or a limited few numbers of customs authorities which operate in the territory of the country in question and enforce national regulations. Depending on the country, customs authorities can have different names, and exercise different levels of both scrutiny and control.
- Protects the environment, and public safety, health and morality by barring international trade in illegal substances and materials e.g. narcotic substances, arms and ammunitionsammunition, endangered animal species, hazardous wastes, and expired, counterfeit or sub-standard goods.
- Represents the political, economic and security interests of and takes legal direction from the central authority of the country, state or semi-autonomous region into and out of which goods flow.
- Generates revenue through collection and enforcement of trade tariffs.
- Liaises with other law enforcement agencies nationally and internationally to prevent trans-border crimes e.g. movement of drugs, stolen motor vehicles and smuggled goods.
- Enhances voluntary trader compliance through quality client service.
- Facilitates legitimate trade.
It is essential that donors and decision-making organizations organisations at origin are aware about the implication of taxes on operating costs as they develop their response strategies.
The customs authorities might not qualify every single entity as “of public interest” or “charitable” and grant the duty waived privilege associated with it. Humanitarian organizations organisations dealing with local counterparts, must make sure that the local counterpart receiving the goods is a registered duty-free entity, and if local exemption is required, that their counterpart is the one taking care of the application for duty exemption and supplying all required documentation. For that purpose, the local counterpart must have the capacity to know the procedures, focal points and regulations within their administration, in order to lodge the application correctly. If they have not got this specific knowledge (what commodities are prohibited or restricted, quotas, etc.) or are just not familiarised with the requirements and paperwork, it is useful to ask advice at local ministries, other NGOs already operating, customs brokers, and tax experts. There are certain items globally that tend to cause more scrutiny than others, and may require special certification. Though regulations are country specific, exporters and importers should pay close attention to the following categories when planning response activities:
Other respective governmental authorities and departments – Many government agencies might play a part in the import and export process, depending on the item, the circumstance or the parties involved, these entities might include the Ministries of Health, Agriculture, Ministry of Foreign Affairs, Ministry of Finance, Disaster Mitigation unit/office, Ministry of Communication, Military and Civil defense, or other involved parties.
Harmonized Customs Harmonised Customs Procedures - Though regulations vary from country to country, there has been an effort to develop a standard nomenclature and numbering convention led by the World Customs Organization the (WCO). The more than 200 member states of the WCO have agreed on what is called a Harmonized Harmonised Commodity Description and Coding Systems, or frequently referred to as the Harmonized Harmonised System (HS) for short. The HS process has also been adopted and backed by the United Nations, through the Kyoto Convention or International Convention on the Simplification and Harmonization Harmonisation of Customs Procedures (Annex J, Chapter 5, specifically deals with relief consignments). Last updated in 2017, the HS codes allow customs authorities and exporters/importers support clearance of goods through simplified and harmonized harmonised customs procedures, thus facilitating international trade. Shippers can learn more about the HS process and look up HS codes for specific products on the WCO’s online system.
Demurrage – Demurrage is the accrual of fees on any cargo items that are left in the holding of a customs authority or air/port side operation after a pre-defined time. Cargo that arrives via air/sea/land border is usually given a specific period of time to undergo clearance without additional charge. The duration of the free of charge period and the daily/hourly rates varies location to location, and is negotiated between the national authorities, the company/authority authorized authorised to run the air/sea port, handling agents, and the transport companies. Demurrage accrued from air and railway shipping typically begins with 1-3 days, while demurrage accrued sea shipping can start as late as two weeks after arrival. Importers should be aware of what their demurrage rates can be, as long-term delays can lead to significant costs.
As the need for international shipments develop, there are key steps that any organization organisation or entity initiating shipping will need to undergo. Exporters/shippers will need to coordinate with the requestorrequester/receiver for key data:
- Receive specific information about the required shipment – Quantities, specific item types, required dates, etc.
- Clarify import/export regulations into and out of the countries relating to the shipment.
- Identify delivery terms, Incoterms and which parties are responsible for what stage of the customs process.
- Identify all documentation needs with the receiver and provide advanced copies to the consignee or customs agent before the shipment.
- If budgets are signed off by either or both parties, communicate potential costs for clearance and shipping.
- Establish transport method (air, sea, road, rail) and identify delivery locations and dates.
Exporters/shippers will also need to properly prepare and organize organise shipment prior to sending:
- Work with vendors to properly identify HS codes, and fulfill fulfil all documentation, packaging and labeling labelling needs.
- Understand national and international regulations surrounding both regulated or banned goods, and legalities around countries of origin/destination.
- Include physical copies of all required customs clearance documentation with the shipment.
- Ensure all required documentation is available, and (where available) double check physical cargo so that items, quantities, and dimensions match documentation.
- Solicit, identify and contract with a transporter, freight forwarder or other certified entity familiar with customs.
For emergency response organizationsorganisations:
- Work with respective program and operations teams to identify routine response activities and pre-define cargo that will likely be used in response activities.
- For prepositioned propositioned stock, it is possible to pre-identify HS codes, shipping documentation needs, and screen against country level import regulations (example – WHO approved medicines list).
- Solicit and identify third party vendors who can rapidly provide the specific products required for response, and make agreements that include documentation and labeling labelling needs.
An organization organisation or an entity intending to receive a shipment should also take steps to properly prepare and identify needs.
Importers/consignees should work establish and work out the legal mechanics for importation:
- Any organization organisation used as a consignee for any shipment must be legally registered in the country of importation. The registration process varies from country to country.
- Wherever possible consignees should avoid listing single individuals as consignee, or using abbreviated or acronyms for agencies as consignee names.
- If necessary, solicit and enlist the services of a clearing agent/company that is duly registered and licensed by the customs authorities to process the import documentation through customs.
- Work with national authorities (customs, health, bureau of standards, border security) and/or contracted clearing agent to identify import regulations and requirements and share with the exporter/shipper.
- Work with national authorities and/or contracted clearing agent to understand all tariffs, duties, fees and possible exemptions.
- Define with the exporter/shipper the Incoterms and limits of responsibilities with the forwarder and/or contracted transporter.
- If the importer/consignee is also the requestorrequester, the importer/consignee should endeavour to provide as much information on the required cargo to the exporter/shipper as possible.
- Prepare for receipt, storage and inspection of the consignments in country.
- Understand the entry points and bottle necks associated with customs clearance.
- Have all documentation ready before consignment arrives.
- Expedite clearances where possible by pre-clearing using advanced copies of documentation.
- Track shipment and know when it arrives in country to avoid demurrage or lost cargo.
- Pre-identify transport to remove cargo from customs, ideally planned around the size of the shipment. Have adequate storage or down-stream deliveries planned as well.
- As soon as consignment arrives, arrange for inspection and clear the consignments through customs.
- Liaise with programming and operational teams to assess needs, and use assessment outcomes to validate needs.
- If possible, apply for authorities and waivers for the exports and the imports.
- Expedite exemptions: where exemptions are already given, immediately authorize authorise shipment of consignments ensuring all the correct paperwork is in place and that the shipping instructions are appropriate.
For arriving by sea:
- In the case of containerized containerised cargo, containers may be unstuffed in the port area before the cargo is presented for examination by Customs. Alternatively, containers may be taken to an inland container depot, or warehouse, or factory of the consignee where they are unstuffed and delivered to the consignee after completing Customs formalities.
- Carting or transporting of export cargo, if it is Break Bulk, is permitted at the berth where the ship is ready to load. In the case of containerized containerised cargo, carting is permitted to the location assigned to the shipping line by the port authority.
- Like imports, exports attract demurrage after the expiry of free time but port authorities sometimes waive this charge in the case of special cargo. Ports may defer acceptance of export cargo if there is a delay in the arrival of the vessel.
- When export cargo is taken to an inland clearance depot, Customs formalities are completed there and the cargo is stuffed into containers, which are then brought to the port for direct loading onto the ship. The same procedure may also be followed if containers are stuffed at the factory or warehouse of the shipper.
Cash Payment - In very rare circumstances, customs authorities will request cash payments. Though it is becoming less common, cash based payments can occur, especially in the aftermath of rapid onset natural disasters. Wherever possible, cash payments customs clearance should be avoided as they are hard to trace and may lead to fraud. If a cash payment for customs is required, organizations organisations should request a receipt in full, detailing what each individual fee was for and the official within the customs authority with whom the transaction occurred.