Navigate common customs clearance challenges with ease and ensure your packages always reach their destination on time!
One of the major issues businesses face is when their shipments arrive at the port and have to go through customs to be cleared.
The waiting period between the “arrived at customs” and “customs clearance completed” notifications can often feel like a very long time. This is because shipments can be delayed for several reasons.
If you’re new to international shipping, this post will help you understand how to avoid delays at the port of entry and enjoy a smooth and stress-free customs-clearing process.
Learn more about how Ship4wd makes customs clearance easier and stress-free.
What Does ‘Customs Clearance Completed’ Mean?
In simple terms, it means that your cargo has successfully passed its screening by the Customs and Border Protection (CBP) agency and you’ve settled all outstanding fees, tariffs, and customs Duty.
Therefore, customs has released your goods to your preferred destination. It’s good to receive a notice that your goods have cleared customs.
Key Benefits of Completing Customs Clearance
Some benefits of your goods being cleared by customs include:
- Your preferred courier can transport the cargo to its next destination.
- You may be able to take delivery of your goods quickly.
- Your shipment won’t be impounded or seized.
- It shows that there’s no problem with your imported goods.
- You have no outstanding import duties or tariffs.
As an importer of goods, you should ensure that your customs broker has the accurate information and documentation they need.
Since most customs delays are caused by errors or missing documents, doing this will help move things along quickly and get your shipments out of customs faster.
Step-by-Step Guide to Customs Clearance
There are five crucial steps to getting your cargo through customs quickly:
1. Accurate Documentation
Submission of the right and complete documentation to the CBP. The documents you’ll submit depend on the shipment’s destination.
However, you must always submit a Bill of Lading (or Airway Bill if you’re using air freight), a packing list, and a commercial invoice (see the FAQ section for a more comprehensive list of required documents).
2. Customs Documents Review
After submission, the CBP will review the documents to determine whether you have the right paperwork and ensure that it matches what’s listed in your cargo.
3. Duty, Tax, and Tariff Calculation
If your documents are in order, the agency will calculate your taxes and duties and wait for you to settle all outstanding charges. If not, you or your customs broker will be notified so that you can either rectify the mistakes, provide valid documentation, or pay any necessary fines.
4. Duty and Tariff Payment
You’ll then proceed to pay all outstanding duties or tariffs.
5. Customs Releases Goods
Once all fees and taxes are settled, customs will release your goods, and you’ll receive the “customs clearance processing complete” notification or something like that.
Even though it seems simple, clearing goods can be a rather tedious process that can easily overwhelm a regular person. Worse, a small error can lead to delays in clearing your shipments and a lot of headaches. You don’t want that.
Our experienced customs brokers can make this rather difficult process easy and stress-free. At Ship4wd, we provide an effective 24/7 customs brokerage service designed to swiftly get your packages through customs. Let us help you today.
4 Common Challenges in Customs Clearance
When goods are delayed at the point of clearing, the most common reason is that the paperwork has errors, such as incorrect product information, missing details in the commercial invoice or packing list, or missing consignee information.
However, there are other issues, including:
1. Consolidated Shipping Issues
In an ideal scenario, most importers who choose ocean freight services would use Full-Container Load freights for their shipment. But that’s not usually the case, as most SMBs don’t need it.
That leaves them with the Less-Than-Container Load freight option. This means they often have to share a container with others. When that container goes through the customs clearance process, all parties may be required to be available to pay their duties and tariffs.
If one or more parties are missing, that could lead to delays.
2. Split Shipments
If an importer needs to ship multiple items urgently but can’t find a slot for everything in one container, they may need to split their shipments into different containers.
This means they would have to wait until the various containers with their shipments are processed before they can clear their goods immediately.
3. Regulatory or Compliance Problems
If your shipment is classified as special imports, it may be subject to antidumping or countervailing duties (AD/CVD). The country imposes these duties to give domestic producers a competitive advantage to compete fairly against imported goods.
An example of special imports would be oil and gas products highly subsidized in the originating country. If those are allowed into the country without AD/CVD regulations, they would be comparably cheaper than local products, meaning domestic oil and gas manufacturers could lose market share.
4. Special or Newly Implemented Regulations
If you were unaware that new tariffs have been implemented on your imported cargo, you may be shocked by sudden high import duties or tariffs. And if you can’t pay, your goods may be delayed.
For example, the United States Trade Representative recently proposed tariff increases in some Section 301 imports from China. Because of this law’s revision, select aluminum and steel products will now attract a 25% increase from 7.5%, semiconductors a 50% tariff rate from 25% in 2025, EVs 100% from 25%, battery parts 25% from 7.5%, and many more.
What Happens After Import Customs Clearance is Completed?
Once the CBP clears your goods, they’ll issue you a release order or customs clearance certificate.
With this document, you can either take delivery of your cargo or have it moved to your preferred destination by your designated courier.
Why Hire a Professional Customs Broker?
The shipment-clearing process is difficult if you don’t have the required expertise. But with a customs broker, you’re less likely to make serious mistakes that lead to delays at the port of entry. But that’s not all.
An experienced customs broker can:
- Ensure the effective compilation and handling of necessary documentation.
- Apply their expertise to ensure regulatory compliance.
- Help lower costs by securing fair quotes, optimizing shipment taxes or duties, and avoiding outcomes leading to demurrage costs or storage fees.
- Provide full pricing or fee transparency and cargo visibility so clients know where their goods are always.
- Resolves unforeseen problems that may arise during customs inspections.
If you want to enjoy these benefits and more, our 24/7 customs broker service can help. At Ship4wd, we’ll handle all your customs-clearing-related problems so you can sleep at night.
Frequently Asked Questions (FAQs)
Some of the common questions we get from customers or prospects include:
What Documents Are Typically Required for Customs Clearance?
The most common documents required for customs clearing are:
- Bill of Lading (for sea freights) or Airway Bill (for air freights)
- Commercial invoice
- Packing list
- Incoterms
- HS Codes
However, depending on factors like the type of cargo or its value, originating country, and intended destination, the customs clearing agency may require additional documentation like:
- Export declaration
- Export license
- Certificate of origin
How Long Does Custom Clearance Processing Take?
It could take anywhere from a few hours to a few weeks. It all depends on the season (holiday seasons are the busiest for customs), supply chain issues (natural disasters affecting ports may lead to backlogs), additional inspections by other agencies, shipment type (regulated/controlled or food items may require extra screening), and documentation (whether it’s complete and accurate).
What Are the Costs Associated with Customs Clearance?
The costs vary by shipment and other factors. But as of July 2024, you’ll pay a Merchandise Processing Fee (MPF) equivalent to 0.3464% of the declared cargo value with rates of $31.67 – $614.35.
Then there are the Single Entry Bond and Importer Security Filing (ISF) fees—$55 minimum. However, if you’re likely to import packages multiple times a year, a Continuous Bond option will save you some money.
This costs $475 annually. Depending on the port or country, you may also need to pay origin and destination charges.
After Customs is Completed, Where Does Your Package Go?
Your package goes to wherever you want. For most people, that’s their preferred destination. Naturally, you or your broker would have to arrange transportation.
Conclusion – What Is Customs Clearance Completed?
Now that you know what it means when you get the “customs clearance completed” notification and what steps to take before and after, let our professional custom broker service help you.
At Ship4wd, our fully digital customs clearance service ensures you enjoy a streamlined and hassle-free customs-clearing process. If you’d like to experience swift cargo clearing at the U.S. ports, sign up with Ship4wd today.