February 06, 2022
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Customs (trade) compliance

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What is customs compliance?

Customs compliance means compliance with legal rules and procedures applicable to goods brought into or taken out of the customs territory. 

Do customs compliance and trade compliance mean the same?

Customs supervise cross-border trade; therefore, the terms ‘customs compliance’ and ‘trade compliance’ may be used interchangeably, meaning compliance with the legal rules and procedures applicable to goods brought into or taken out of the customs territory. 

What is governed by the legal rules?

Customs supervises trade contributing to fair and open trade, to the implementation of policies having a bearing on trade, and to overall supply chain security. Taking this into account, customs control:

  • duties and taxes to be paid, and the correct classification of goods, their value and origin;
  • application of product health requirements, veterinary, phytosanitary and quality regulations;
  • compliance with environmental legislation (hazardous chemicals and pesticides, substances that deplete the ozone layer, waste, etc.); 
  • application of product safety requirements and other market regulations (marking, labelling, certificates, etc.);
  • compliance with security and safety regulations (fight against terrorism, trade in dual-use and military goods, sanctions, embargoes, etc.);
  • compliance with intellectual property rights (counterfeited goods), etc.

Where are the legal rules set out?

The legal rules are enshrined in international conventions, bilateral and multilateral trade agreements, customs union legislation, and countries’ national legislation. 

The primary source of the rules of a customs territory is its customs-related legislation. For example, the Union Customs Code in the EU, and the Taxation (Cross-border Trade) Act 2018 in the UK. 

How complex is it to comply with the rules?

The legal rules cover broad regulatory areas and are constantly changing. Therefore, management of customs compliance might become a very complex task for business, depending on the type and number of goods traded, and the target markets.

Comments ()

image en
Customs clearance in the EU: basics for the container shipping and logistics industry
07-05-2022

Customs Knowledge Institute

compliance and risk management
image en
Customs clearance in the EU: basics for the container shipping and logistics industry
07-05-2022

Customs Knowledge Institute

compliance and risk management
en, lt
Who is responsible for customs compliance? or When everyone is responsible - no one is!
30-04-2022

Reader‘s question: We are a medium-sized EU manufacturing company. We import and export goods, and customs clearance is handled by customs agents. We are going to set up our own customs warehouse, apply for the AEO status and obtain authorisations for customs simplifications. We have also faced restrictions in regard to the sanctions imposed on Russia and Belarus. The question is, who in the company should be responsible for fulfilling the customs requirements and complying with them so that customs-related processes run smoothly?

Enrika Naujokė

compliance and risk management
en, lt
Who is responsible for customs compliance? or When everyone is responsible - no one is!
30-04-2022

Reader‘s question: We are a medium-sized EU manufacturing company. We import and export goods, and customs clearance is handled by customs agents. We are going to set up our own customs warehouse, apply for the AEO status and obtain authorisations for customs simplifications. We have also faced restrictions in regard to the sanctions imposed on Russia and Belarus. The question is, who in the company should be responsible for fulfilling the customs requirements and complying with them so that customs-related processes run smoothly?

Enrika Naujokė

compliance and risk management
image en
Customs risk and the business: risk by functions
25-02-2022

Catherine A. C. Truel

compliance and risk management
image en
Customs risk and the business: risk by functions
25-02-2022

Catherine A. C. Truel

compliance and risk management
en
Customs clearance in UK in 2022: what could possibly go wrong?
06-02-2022

Being aware of the many things that could go wrong with customs in 2022 will make you think about how to minimise risks.

Jessica Yang

compliance and risk management
en
Customs clearance in UK in 2022: what could possibly go wrong?
06-02-2022

Being aware of the many things that could go wrong with customs in 2022 will make you think about how to minimise risks.

Jessica Yang

compliance and risk management
en, lt
Customs risk
06-02-2022

Businesses manage two types of risk: the risk of non-compliance with legal requirements; and the risk to miss out to acquire competitive advantage (by not utilising legal possibilities).

compliance and risk management
en, lt
Customs risk
06-02-2022

Businesses manage two types of risk: the risk of non-compliance with legal requirements; and the risk to miss out to acquire competitive advantage (by not utilising legal possibilities).

compliance and risk management
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