Summary of this article：Customs clearance converts a shipment into a recognized imported product by a government authority. Usually, any customs issue is preventable if the appropriate documentation is readily available and if the overall process is understood.
Customs clearance
Customs clearance is the presentation of documents to customs authorities for checking and verifying whether classifications of HS codes, value of customs, origin and the duties and taxes applicable to import are correct or not. Bill of lading or airway bill, packing list and commercial invoice are some of the major documents that require checking.
Customs clearance step-by-step procedure
1. Verify whether the goods can be imported into the country - verify required permits, certificates, testing and labelling information before shipping.
2. Identify HS codes - it determines the rates of duties and necessary checks and documents. The codes are made of six digits worldwide (plus additional digits as in specific country codes, like HTS in the U.S.).
3. Assemble documents - product description, unit and total values, quantity, currency, country of origin, Incoterms and HS code should all be declared on the commercial invoice.
4. Enter declaration - an importer or agent should file this declaration electronically; an entry summary must be filed and duties deposited within 10 working days after the shipment enters the U.S.
5. Customs inspection/examination - you will either have your shipment released immediately, an examination of the documentation, or a physical examination of the goods.
6. Pay duties/taxes - once paid, you can receive your release.
Who is liable? (Incoterms and the importer of record)
Incoterms will determine which of the importer and exporter takes on duties and responsibilities and associated costs. Exports fall from the exporter in most of the Incoterms whereas imports fall from the importer (apart from DDP, where import duties and taxes are the seller's responsibility). Always confirm the importer of record and what is being declared, even in case of DDP.
Necessary documentation
•Commercial invoice, packing list, bill of landing or airway bill, the required licenses or permits when regulated, certificates if any, certificate of insurance if it applies. Discrepancies in documents cause delays.
•Landed cost, duties and taxes
•The customs value, classification, country of origin and trade policy affect duty rates, therefore always take landed cost (and not just the product cost) into consideration.
Reasons for shipments being delayed
Incorrect HS code classification, inaccurate product description on the invoice, understatement of product value, misleading country of origin declaration, missed/incorrect certifications and licenses/permits (when regulated), discrepancies between or missing documents, and Random checks.
The U.S. Specific Requirements
•ISF Submission - all data must be submitted to customs 24 hours before the ocean carrier departure.
• Formal Entry - for all goods valued $2,500 or more.
•De minimis suspended - On August 29, 2025, the duty free de minimis treatment was suspended and formal entry must be done for all the small parcels.
Best practices
Product description should be detailed (model, function and material), HS codes and valuations should be the same from one shipment to the next, hire customs brokers for regulated goods, and do not undervalue. The cost of penalties would be more than it.
Conclusion
A customs clearance is a regulated process where classification, customs value, country of origin and regulatory compliance dictates customs clearance. This creates a repeatable customs documentation and clearance process.
