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’ are often 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 ()

en, lt
Customs-competent staff: nice to have or a must?
02-10-2022

Customs compliance is full of challenges and ‘surprises’ from counterparties, customs brokers, carriers and other persons involved. Unpredictable risks and conditions are the inevitable companions of international trade. However, there are many areas where companies might keep most of the risks under their control. What are these areas? What should companies do to mitigate such risks and meet the related challenges?

Assoc Prof Dr Momchil Antov

compliance and risk management
en, lt
Customs-competent staff: nice to have or a must?
02-10-2022

Customs compliance is full of challenges and ‘surprises’ from counterparties, customs brokers, carriers and other persons involved. Unpredictable risks and conditions are the inevitable companions of international trade. However, there are many areas where companies might keep most of the risks under their control. What are these areas? What should companies do to mitigate such risks and meet the related challenges?

Assoc Prof Dr Momchil Antov

compliance and risk management
image en
Non-compliance with customs laws: who is liable?
25-09-2022

Anthony Buckley

compliance and risk management
image en
Non-compliance with customs laws: who is liable?
25-09-2022

Anthony Buckley

compliance and risk management
en, lt
Targeting compliance in the minefield of customs (trade) rules
23-08-2022

‘I would recommend trade compliance to anyone with the ability to distil complex, rigid structures down to a practical reality. Trade compliance rules are a minefield that even the most seasoned professionals cannot confidently claim they have a complete grasp of. If you're willing to constantly be challenged and willing to continuously learn you'll probably fit in well.’– says Samuel Draginich, Senior Trade Compliance Manager, EMEA (Europe, Middle East, and Africa), Amazon EU and Member of the Editorial Board of CCRM journal.

Samuel Draginich

compliance and risk management
en, lt
Targeting compliance in the minefield of customs (trade) rules
23-08-2022

‘I would recommend trade compliance to anyone with the ability to distil complex, rigid structures down to a practical reality. Trade compliance rules are a minefield that even the most seasoned professionals cannot confidently claim they have a complete grasp of. If you're willing to constantly be challenged and willing to continuously learn you'll probably fit in well.’– says Samuel Draginich, Senior Trade Compliance Manager, EMEA (Europe, Middle East, and Africa), Amazon EU and Member of the Editorial Board of CCRM journal.

Samuel Draginich

compliance and risk management
en
Some thoughts on Customs role in sustainable development
01-07-2022

This article looks at how Singapore Customs strives to bring efficiency in the management of trade operations to lower their impact on the environment as well as at the initiatives it has taken to support environmental policies.

compliance and risk management
en
Some thoughts on Customs role in sustainable development
01-07-2022

This article looks at how Singapore Customs strives to bring efficiency in the management of trade operations to lower their impact on the environment as well as at the initiatives it has taken to support environmental policies.

compliance and risk management
en
Four common misconceptions in the relationship between importers and customs brokers
16-06-2022

Importers often try to avoid customs clearance processes, relying entirely on the customs broker. On the one hand, the broker is a customs expert, possesses relevant experience and, ultimately, receives a commission for his/her work. It seems that the importer should not be involved in the processes managed by the customs broker. On the other hand, such self-exclusion can result in very unpleasant financial and reputational consequences. This article considers the most common misconceptions of importers in cooperation with customs brokers, which cause losses for both sides.

Peter Mitchell

compliance and risk management
en
Four common misconceptions in the relationship between importers and customs brokers
16-06-2022

Importers often try to avoid customs clearance processes, relying entirely on the customs broker. On the one hand, the broker is a customs expert, possesses relevant experience and, ultimately, receives a commission for his/her work. It seems that the importer should not be involved in the processes managed by the customs broker. On the other hand, such self-exclusion can result in very unpleasant financial and reputational consequences. This article considers the most common misconceptions of importers in cooperation with customs brokers, which cause losses for both sides.

Peter Mitchell

compliance and risk management
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