A Customs agent may be defined as “one who is licensed by the Customs and authorized to act on behalf of importers and exporters in the clearing of goods in and out of the country”. It is not right to describe a customs agent as anybody that is licensed by the Customs to act on its behalf in the collection of duties and taxes from importers. Such a description is wrong because it tends to portray the agent as someone who works for the Customs.
Customs brokers, as agents are sometimes called, act on behalf of exporters and importers to clear goods through Customs, either for export or for home use(import). They obtain a license from the Customs Service, which gives them the right to act as agents. The role of customs agents is also very important in international trade. Their work involves preparation and submission of documentation required to facilitate the clearance of imports and exports, including assessment and payment of duties and taxes, attending to customs examinations and obtaining a release.
Agents work closely with the Customs to achieve goals and objectives set for Customs authorities. They are, generally, seen as the foremost partners of Customs authorities in the area of trade facilitation and supply chain security. A well-trained customs broker thoroughly understands the customs tariff and is able to classify goods accurately, using the Harmonized System (HS) code. A good customs agent would normally have an up-to-date database with information that meets the compliance demand of the Customs and the various regulatory authorities.
Countries are constantly entering into trade agreements and there is a growing demand for trade facilitation. These together with Customs modernization initiatives are resulting in changes in regulatory policies which customs agents have to meet. In Nigeria, professionals in the freight and shipping industry are predominantly customs agents while the core freight forwarders tend to also engage in customs brokerage. Similarly, customs agents are also expanding their roles into freight forwarding. It is usually not mandatory for forwarders act as customs agents, as they can hire the services of a broker.
Freight forwarders as I already noted, do not need to obtain a Customs license to function even though it may be desirable. This is because the freight forwarder can hire a customs agent to carry out the job of customs clearance in the process of moving goods from origin to destination. Notwithstanding, customs brokerage is an integral part of freight forwarding. Freight forwarders and customs brokers both represent importers and exporters in the handling of goods, but their roles are clearly defined with some interrelated activities.
While the customs agent’s role is confined to the country within which he operates, the freight forwarders partnering with customs agents to offer services to their clients. For example, a freight forwarding company in the UK may require the services of a customs broker in Nigeria to clear and deliver goods on its behalf. Customs agents, therefore, need to be reliable, knowledgeable and have the resources to provide efficient services.
Mistakes in customs declarations can be costly and can affect the integrity of the agent. Where a partnership exists between a freight forwarder and customs agent, the work processes should be clearly stated in order to streamline operations for effective and efficient performance.
Below are some basic difference between Freight Forwarding and Customs Brokerage
Customs Brokerage Freight Forwarding
||Can cover several countries|
|2. In-depth knowledge of Customs regulations and practice required||Good knowledge of customs regulations and practise acceptable|
|3. Little or no logistics function involved||Predominantly a logistics service|
|4. Very little transport planning (if any)||Involves complex transport analysis and planning covering all modes of transport|
|5. Fair knowledge of international trade required||In-depth knowledge of international trade required|
|6. Little knowledge of supply chain management acceptable||Good knowledge of supply chain management required|
|7. Knowledge of laws relating to international transportation of goods not required||Must have a good knowledge of the laws covering international transportation of goods|
|8. Affiliated to the International Federation of Customs Brokers Associations (IFCBA) set up in 1989 with headquarters in Ontario, Canada||The profession is under the aegis of The International Federation of Freight Forwarders Associations (FIATA) which was founded in Vienna, Austria on May 31st 1926|
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