We often hear the term, “subject to customs clearance and inspection”, and we are left with a shadow of uncertainty to the outcome of our shipment. When we ship internationally, we want to be assured that our shipments will reach the destination hassle-free, delay-free, but, most importantly, we want visibility and a definitive resolution.
The customs and immigration department is the regulatory authority run by the country’s government.
Here are 5 reasons why customs clearance is important:
1. For regulation & control
A fundamental purpose of a customs department is to ensure all items going in and out of their country is compliant with their mode of transportation, legal and not dangerous.
2. Protect and support domestic businesses
For example, the government would tariff or tax foreign products entering their country at a higher rate, so that the local business in the same industry would benefit by being able to sell their similar product at a lower rate.
3. Protect agriculture and wildlife
A prime example would be exporting live plants into Australia, it is strictly prohibited as the Australian government wants to safeguard their environment.
Source: https://www.abf.gov.au/entering-and-leaving-australia/can-you-bring-it-in/categories/plants-flowers-and-seeds
4. Collate statistical data
We constantly emphasize that the description of your shipment on the waybill and invoice has to be accurate, and for good reason. Each item being shipped will be categorised by a Harmonized System (HS) code – an internationally recognised coding system for all commodities. After classification, they can be categorised easily to understand what are the top imports and exports for the country, and which industries the government can focus on, to build on their international trade.
5. Collect duties and taxes
Understandably, all customs will have a different duty and tax structure, based on what we have read above. It is important to understand the rates before shipping to a country, because for certain commodities, the duties or taxes may be very costly, causing your overall costs to increase drastically. This is where it is important to indicate the correct mode of payment for duties and taxes on your waybill prior to shipping, to ensure a smooth clearance and billing process.
Read more on how our in-house customs teams at DHL Express can help mitigate the uncertainty of customs clearance.
