Benefits of broker integration and centralised clearance under the Union Customs Code

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Dutch customs agent Portmade is offering customs brokerage, advisory services, and a comprehensive portfolio of logistics services for the global movement of goods.

And they are leading by example in taking advantage of simplifications under the Union Customs Code (UCC): In April 2017, Portmade received a “centralised clearance license” - the first ever in the European Union under the UCC, which has been in effect since May 2016.

Centralised clearance (CC) is amongst the simplifications linked with the placement of goods under UCC customs procedures. A CC license authorises its holder to electronically submit customs declarations to the local customs office, even if the actual goods are presented to another customs office within the EU customs territory. An important condition is certification as Authorised Economic Operator (AEO).

This simplification applies to all customs procedures, except for goods in transit or under temporary storage. At the moment, Portmade’s license only applies to the cargo of one customer going from Rotterdam to Belgium, but Portmade is considering extending it. Going forward, an increase of CC applications is expected, both from service providers and shippers. Centralised clearance allows economic operators to centralise and integrate logistics, accounting, and distribution functions. It offers great benefits: reduced costs for administration and transactions, as well as simplification and process acceleration. But it isn’t just brokers who can benefit from this new EU license – shippers can take advantage as well. And there is more shippers should do to truly optimise their customs processes and reap the benefits.

For example, many shippers work with different software-based customs solutions in every country they operate in, or they outsource customs handling to customs brokers, who then use their own IT systems without any integration with the shippers’ systems, leading to a scattered customs IT landscape within a company’s network. Such a set-up also increases costs, e.g. for specialist staff and system maintenance. It’s also more error-prone and results in a lack of transparency. Regardless of whether companies handle their customs strategy in-house or outsource it, system integration is crucial. And it delivers even better benefits to manage customs processes across borders within a single customs solution.

If you are looking for more efficiency, less hassle, and full regulatory compliance in customs management, you need an IT system that’s both smart and powerful. It should be capable of managing standard import and export processes as well as specific procedures, such as bonded warehousing, NCTS, and IPR/OPR. And of course, it should also be able to manage customs procedures in different countries, in line with respective, local requirements.

In an international environment, outsourcing customs management to a customs broker can be a cost-effective solution, e.g. if a subsidiary doesn’t have enough trained staff or can only handle small volumes. In many countries outside the EU, brokers are practically a necessity for legal reasons alone. So if your company’s strategy is outsourcing, it should be a key priority to integrate your customs brokers in your overall IT landscape. Because without system integration, working with customs brokers can cause more errors and more work than necessary.

Sending documents such as pro forma invoices to customs brokers by e-mail and forcing them to re-enter data manually is a costly interim step that can be easily eliminated by integrating brokers in a multi-country customs platform. Brokers then import the data they require directly from such a platform and vice versa and send customs notices, proofs of exit, etc. directly back via this channel. This bi-directional integration considerably accelerates the process, lowers costs, and ensures transparency – for your company, your customs broker, and for customs inspectors.

Iqubal Singh Pannu

Iqubal Singh Pannu is Senior Solutions Consultant at AEB in the UK and has been with the company since 2006. With considerable consultancy and project management experience, spanning several areas of the supply chain, Iqubal is advising companies on solutions for optimising supply chain performance and generating value through automated global trade and logistics processes.

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