Why are my goods stuck in customs?
Mouse & Bear regularly receives calls from companies around the world that have unexpectedly had goods held or seized by Customs. The reason their shipment has got stuck in Customs is often not clear, but the rejection of the import has to be resolved. Unfortunately, many companies aren't sure what to do or how to get their goods released and cleared through the local processes.
One thing, however, is certain: having a shipment held up in a complex Customs situation can cause severe disruption to your customers’ buying experience, damaging your reputation and incurring extra costs and lost revenue.
So why are your goods stuck in Customs, and what should you do about it?
Top reasons why your equipment has been rejected by a Customs authority
1. Commercial Invoice (CI) is missing information
Inaccurate paperwork is often the reason Customs have put your import on hold. It’s important that the paperwork that ships with the consignment contains everything Customs departments need to know about the goods in order to avoid customs clearance issues. A CI should contain the following:
- Shipper name, full address, telephone number and contact name
- Full Consignee name and address, telephone number and contact name
- Part Code(s), Description of Goods, and Quantities
- Value of the goods, ensuring you note the currency
- Weights (in kg), dimensions (cm) per package and package quantities for the shipment
- Shipping IncoTerms - DDP etc
- ECCN and HTS codes: Full ECCN including sub ECCN if applicable and full HTS code which should contain 10 digits
- Product(s) Country of Origin
- Any Export and/or Import numbers if required
Without this key information, Customs won’t be clear on what you are trying to Import and will therefore automatically stop the shipment. When information is missing, they will inform the shipper and / or the Freight Forwarder until it is resolved. This may include re-submitting a revised version.
2. HTS Code or ECCN Numbers are incorrect
The ECCN (Export Control Classification Number) and HS Code (Harmonized Commodity Description and Coding System) are key to helping Customs decipher the categories that the goods fall under.
The ECCN number exists to help identify dual use items for export control. The HS Code is a classification system which enables participating countries to deem what type of goods are, and how they should be taxed – we’ve written a helpful guide to classifications for controlled and dual use goods if you need more information.
If these all-important numbers are incorrect, the rest of the paperwork becomes unbalanced and Customs will hold the goods until this information is corrected to their satisfaction.
Codes can be found here: https://www.findhs.codes/
3. Valuation of the Consignment
Your shipment could be held pending clarification of your goods' valuation. "Customs Value" refers to the value of the imported goods as evaluated by Customs. It’s used as the foundation for assessing the amount of import duty and other taxes that need to be paid.
If you attempt to import goods at a value the Customs department don’t feel is correct, your shipment could be held pending clarification. Customs will revalue the goods based on their own research – often this is by way of multiple Google searches to see where they can buy the goods, and for how much – an online reseller for instance.
If Customs conclude that the shipment's true value is higher than declared, they will then request an additional payment in taxes and duties. It is important that goods are not purposefully undervalued for this reason.
Read more about the implications of imported goods that are revalued by Customs.
4. The Consignee refuses to be listed as the Importer
An Importer of Record (IoR) is an individual or legal entity that is responsible for ensuring that goods are imported in accordance with the local customs legislation of a given destination.
An IoR is responsible for the completion of all the required documentation to meet import requirements, in addition to paying duties and taxes. Typically, to act as an Importer of Record, the company must have a registered entity within the country they want to import into. If the consignee refuses to be the importer, the kit will be rejected and held by customs.
The consignee may refuse to act as the importer because they do not want to be involved in the process, or they may not understand the process. Depending on the country, if consignee refuses to act as the importer the kit will either be sent back to the shipper or Customs will seize the shipment and re-sell it to put the funds towards the import costs.
Read more about why the end user may not want to be the Importer of Record.
5. There are more (or less) physical packages than described on the Commercial Invoice
Customs officials will always check the number of physical packages compared with the information on the Commercial Invoice – if there is an inconsistency between the two, they will seize the shipment and request clarification from the Shipper as to why there is a differential. At the very least, they will hold the goods until they are satisfied, or they may return the entire shipment. It’s important if this happens that it is explained how this error occurred.
If the goods being imported fall under a controlled ECCN number, or the in-country import process requires document submission and pre-approval prior to the goods being shipped, then it’s very important this is done.
If any of these documents are missing, Customs will either immediately reject the consignment and ask it to be sent back to source or hold the shipment for a set period of time to allow the Shipper to submit the documents. Storage charges will be charged during this period. It is incredibly important to check the import requirement of the country you are importing to, to avoid this serious situation.
What to do if a shipment is stuck in customs
If you’ve encountered a problem with Customs clearance for your shipment of IT equipment and you can’t resolve the situation yourself, it may be time to ask for professional help. Our global network of partners is extremely experienced in working with their local customs departments to help get shipments released.
Mouse & Bear Solutions offer a specific service designed to help companies that have customer clearance issues with shipments of IT equipment, no matter the reason.
Still need help? Please get in touch for expert assistance.