The Key Differences Between Customs Declaration and Customs Clearance: A Must-Know for Foreign Trade Professionals

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2025/01/10

The Key Differences Between Customs Declaration and Customs Clearance: A Must-Know for Foreign Trade

In foreign trade, many people tend to confuse "customs declaration" and "customs clearance," even though these two processes are closely related, they are fundamentally different.

In simple terms, customs declaration is the process of reporting the import and export status of goods to customs, while customs clearance ensures that these goods comply with all regulations and can be freely circulated in or out of a country. Today, we will delve into these two concepts, helping you avoid common misunderstandings in foreign trade operations.

1. Customs Declaration

Customs declaration refers to the process in which an importer or exporter (or their agent) reports the goods they are importing or exporting to customs. This is a crucial step as it is the starting point of the entire trade process. It ensures that the information about the goods (such as product name, quantity, value, etc.) is accurately recorded and that the applicable duties and taxes are calculated.

The materials required for customs declaration include documents such as commercial invoices, packing lists, and bills of lading. A customs declaration form must be filled out, detailing the goods' specifications. In addition to basic product information, the declaration must also comply with the laws and regulations of both the exporting and importing countries. For example, the goods must be classified according to the Harmonized System (HS) Code and may require an origin certificate or other relevant documents. Some products may also require special certifications, such as import licenses or quality certifications.

2. Customs Clearance

Customs clearance refers to the process in which goods pass through customs inspection and complete all necessary procedures before being officially authorized to enter or leave a country. Once customs clearance is completed, goods can legally enter the market or be transported to the final destination.

During the customs clearance process, the goods may undergo a physical inspection to verify that they match the declared information and comply with the importing country’s safety, health, and quality standards. The clearance process involves paying applicable duties and taxes, and all regulatory requirements must be met for the goods to be released.

3. Import Customs Declaration Process

The process of declaring imported goods to customs can be complex. It starts once the goods arrive at the port, and the steps are as follows:

Confirm Shipping Schedule: Determine the shipping schedule, and begin the import process once the goods arrive at the port.

Obtain Required Documents: Provide the arrival notice, original bill of lading, or delivery guarantee to obtain the necessary documents.

Transport Goods to Customs Supervised Warehouse: After the goods arrive, they should be moved to a customs-supervised warehouse while awaiting clearance.

Prepare Documents for Customs Declaration: Required documents include the packing list, invoice, contract, and customs declaration forms. Different countries may require specific documents such as import licenses or certificates for special goods (e.g., plant quarantine certificates for wooden packaging).

Provide Duty Reduction Documents (if applicable): If there are duty reduction or exemption policies, provide the relevant proof or tax exemption documents.

Pay Taxes and Fees: After customs valuation, taxes and fees must be paid within the specified time. Late payments will incur fines.

Customs Inspection and Release: After the goods pass the customs inspection and any required checks, they can be released for delivery.

4. Export Customs Declaration Process

Similar to the import process, the export customs declaration also follows a clear procedure:

Booking with Shipping Company: First, book the shipping space with the shipping company and prepare the necessary export documents.

Prepare Export Declaration Documents: Required documents include packing lists, invoices, contracts, and customs declaration forms. All required paperwork must be submitted to customs at least 24 hours before loading the cargo.

Pre-Inspection Requirements: Some exports require inspection before customs clearance. For example, if the packaging is made of wood, fumigation or heat treatment might be required. In these cases, necessary documents such as fumigation certificates and factory inspection certificates must be provided.

Customs Declaration: Once all required documents are prepared, submit the export declaration to customs for processing.

Pay Export Taxes (if applicable): If there are any applicable taxes, they should be paid promptly.

Customs Review and Release: After customs checks the documents, the goods will be allowed to pass through customs. If required, goods will undergo physical inspection and can be released upon successful clearance.

Shipping Company Submits Manifest: The shipping company submits the export manifest to customs. After the customs clearance process, the exporter can obtain the necessary paperwork, including tax refunds if applicable.

5. Improving Foreign Trade Efficiency: The Power of Data-Driven Customer Development

In foreign trade, the speed and accuracy of information handling are crucial to success. The Tradeindata foreign trade analytics platform can help foreign trade professionals precisely identify global market demand, analyze potential customers, and optimize customer development strategies. By leveraging in-depth data analysis on customs, market trends, and industry movements, you can quickly pinpoint promising customers and reduce ineffective efforts.

Using such data tools, foreign trade professionals can not only increase customer development efficiency but also optimize overall foreign trade decision-making. This ensures that every investment contributes to tangible returns.

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