Beyond the border: Understanding the role of a customs broker in freight shipping

International shipping is complex and typically involves navigating numerous regulations, paperwork, and potential pitfalls. From ensuring compliance with trade laws to calculating duties and taxes, the customs clearance process can be overwhelming for the non-expert.

Enter the customs broker — a trusted expert who ensures your freight clears customs efficiently and legally. This article explores the essential role of customs brokers in international shipping, the services they offer, and what to look for when choosing a customs broker.

What is a customs broker?

A customs broker is your partner for exporting and importing goods legally.

They are licensed intermediaries who facilitate the movement of goods across international borders by managing the customs clearance process. They ensure your shipment complies with all applicable laws, tariffs, and taxes and clears the borders without any disruptions.

• Licensed customs brokers act as a bridge between shippers and customs authorities, helping businesses avoid costly delays, penalties, or legal issues. Each country maintains its own customs jurisdiction, enforcing specific trade rules, duties, and procedures aligned with national policies.
• For example, US customs brokers are regulated and licensed by US Customs and Border Protection (CBP). They can represent individuals, businesses, or freight forwarders to streamline international trade operations.
• Likewise, in the European Union (EU), there is a network of national customs administrations working together within the EU Customs framework, operating under unified rules, including common tariffs for goods imported from outside the EU.

What does a customs broker do, and what services do they offer?

While customs documentation and declaration are core to their work, customs brokers offer additional services geared to ensuring smooth, compliant, and efficient customs clearance. These typically include:

• Customs declaration and clearance: Handling all documentation and procedures required to clear goods through customs for both imports and exports.
• Goods valuation and classification: Ensuring goods are classified correctly with the appropriate HS codes for accurate tax and compliance.
• Trade compliance audits: Reviewing shipping and trade documentation to identify and rectify compliance issues and provide updates on emerging regulations.
• Freight coordination: Working with third-party logistics providers to ensure end-to-end movement of goods.
• Customs bonds: Assisting with securing this crucial financial document, which acts as a guarantee between the importer, customer authorities, and a surety company. This ensures the importer meets their obligations, such as paying applicable duties, taxes, and penalties. For example, in the US, customs bonds are mandatory for commercial imports valued over $2,500 or those subject to additional regulations like FDA clearance. In the EU, customs bonds are often required for goods placed under customs warehousing or those subject to specific excise duties.
• Specialised handling: Providing customs expertise for transporting high-value, perishable, or regulated goods like pharmaceuticals, food, and electronics.
• Tariff and duty calculations: Accurately determining applicable duties, taxes, and tariffs, as well as leveraging applicable trade agreements and programmes eliminating duties on products imported from designated beneficiary countries (such as the duty preference programs in the US and the Generalised Scheme of Preferences in the EU).

As an example, Maersk Customs Services can check if your goods qualify for special tariff reductions, potentially lowering your overall costs.

What is the role of a customs broker in international trade?

Global trade isn’t merely about getting goods from Point A to Point B. Every country enforces its own import and export rules to be followed. Some require specific health certificates for food; others have strict safety standards for electronics. Moreover, tariff rates change frequently. Seemingly insignificant errors, like using the wrong HS code for a product, can mean expensive fines or long delays at the border.

Customs brokers excel at cutting through these dynamic, cross-border complexities of customs clearance. Their expertise is essential for businesses that want to focus on core operations rather than getting bogged down by regulatory and trade compliance burdens.

Can a customs broker help if regulations suddenly change?

Most definitely. Customs brokers track shifts in trade policies, tariff rates, and documentation rules in real time. If a new rule appears tomorrow, your broker will guide you through it, ensuring your shipments continue moving smoothly.

Do I need a customs broker?

If your business involves importing or exporting goods, hiring a customs broker can be a game-changer. Here’s why:

Managing customs clearance in-house is unpredictable and potentially expensive.

Without a customs broker, you’re responsible for researching complex regulations, classifying products correctly, and staying current on every new regulation.

For the non-expert, this can easily lead to costly mistakes, like using the wrong tariff code or forgetting a required certificate. It can also have significant financial consequences, including fines for non-compliance, paying extra duties that could have been avoided, or even potential legal action in severe cases. Beyond immediate costs, such oversights can topple your supply chain efficiency, damage your reputation, and disrupt critical delivery timelines

For example, in the US, customs non-compliance can result in penalties starting at $10,000 per violation, depending on the severity. In the EU, improperly declaring goods or failing to meet customs requirements can lead to fines — calculated as a percentage of the goods’ value, additional import duties, and seizure of shipments in extreme cases.

Over time, the involved risks and cumulative implications can far outweigh what you’d pay a licensed customs broker to avoid such pitfalls.

Benefits of using a customs broker

Here’s when and why you might need a customs broker:

• Navigating complex regulations and ensuring compliance: Customs laws and trade regulations are difficult to understand and constantly changing. If you’re unfamiliar with the requirements, a customs broker will ensure accuracy and compliance every step of the way.
• Expertise in HS classification: Incorrect freight classification can result in hefty penalties. Brokers ensure proper classification of goods using Harmonized System (HS) codes, thus optimising costs.
• Minimising delays: Brokers handle documentation, submissions, and communication with customs authorities to expedite clearance – thereby preventing potentially costly delays at customs.
• Optimising costs: Managing customs paperwork can be time-consuming, which means extra cost. Customs brokers also help you identify potential cost savings by ensuring accurate classification of goods, proper valuation, and appropriate duty/tax calculations. What’s more, they enable businesses to leverage trade agreements and duty exemptions, as well as avoid penalties for misfiled paperwork or missed deadlines.
• Managing and reducing risk: Mistakes in customs compliance can disrupt your supply chain and damage your reputation. A licensed customs broker minimises risks by proactively identifying and addressing compliance issues.
• Handling specialised shipments: If you’re shipping regulated, high-value, or time-sensitive goods, like pharmaceuticals or perishable food, brokers provide the necessary expertise to handle the added complexities of such shipments.

Most importantly, working with a customs broker gives you confidence and peace of mind. Instead of worrying whether you’ve missed a crucial update or misinterpreted a regulation, you can rest assured that a professional is handling the task.

How to choose a customs broker?

Not all customs brokers are created equal. Choosing the right partner involves several factors that align with your business’s goals and operational footprint. Here’s what to consider when selecting a customs broker:

1. Certifications and credentials: Look for brokers accredited by recognised authorities in your target markets. For example, the Customs-Trade Partnership Against Terrorism (C-TPAT) certification in the US indicates a commitment to secure and compliant trade operations. Similarly, in the EU, the Authorised Economic Operator (AEO) programme is a key certification, offering customs simplifications and security-related benefits.
2. Experience in specific regions or industries: Expertise is often geographical or sector specific. A broker with a proven track record in Asian markets might be best suited for import/exports from China, while another focusing on perishable goods might be ideal for agribusiness exporters.
3. Digital tools and technology: Whether it’s real-time tracking, predictive analytics for duty optimisation, or direct integrations with national customs systems, a broker’s technological capabilities can significantly improve efficiency and transparency and streamline your clearance process.
4. Global network with local presence: International brokers with extensive global reach and local expertise can promptly address unexpected issues or local policy changes. They understand unique local customs procedures, cultural nuances, and language barriers that can derail a well-planned shipment.
5. Proactive guidance and thought leadership: The best customs brokers don’t just react to changes; they anticipate them. They keep you updated on emerging trade policies, alert you to upcoming HS code revisions, and provide strategic advice to optimise your supply chain well before you face a bottleneck at customs.

Take the time to evaluate brokers based on their expertise, technology, and global presence to ensure they align with your business needs. Look for experienced, trusted, long-term partners who can simplify your import-export operations.

With its global footprint, deep industry expertise, and a commitment to staying on top of every regulatory change, Maersk Customs Services can assist with your customs procedures and help optimise cross-border trade.