Customs Clearance
Customs clearance is the authorization granted by a government’s customs department to a shipment to enter or exit the country’s borders.
Customs clearance is a vital procedure for the international shipping of goods. Once customs have cleared a shipment, shippers must produce the necessary documentation showing what duties and other expenses they have paid before the shipment can be released.
This applies to all international shipments, with different countries applying different duties and fees. Shippers can either research and calculate all relevant regulations and fees independently or work with a customs broker with local knowledge and expertise.
Customs clearance can be broadly broken into four sections:
- Paperwork – A customs officer must verify that all completed paperwork for the shipment has been completed correctly and that relevant information, such as commercial invoices, shipper and receiver contact information, and more, is included.
- Customs Officer Check – Customs officers determine which fees apply to the shipment based on cargo type, value, and the importing country’s laws. At this point, they will also check if duties and other fees have been paid.
- Taxes, Duties, and Other Payments – When Customs asks a shipper to pay the duties on a shipment, a shipper can choose either Delivery Duty Unpaid (DDU) or Delivery Duty Paid (DDP). DDP shows that all duties have been paid by the shipper, while DDU indicates that the duties must be paid by the buyer/importer.
- Release of Shipment – If all paperwork has been completed and all fees, taxes, and relevant duties paid, customs can release the shipment for transport to its final destination.