What is customs inspection? | About Checkpoints, Procedures, and Types

Customs inspection plays a crucial role in import and export clearance. While it is impossible to guarantee that shipments will not be inspected by customs, it is important to have a good understanding of the process. In this post, I will explain the process in 8 points below.

1. Understanding Customs Inspection
2. How Customs Inspections Work
3. Shipments That are Easier to be Inspected by Customs
4. What Are Customs Officers Looking For?
5. China customs inspections (4 methods & process explained)
6. The five most common types of customs exams in the US
7. Fees and Time for Customs Inspections
8. What to do if your cargo is held at customs?

1. Understanding Customs Inspection

Confirming that the goods match the documentation issued

This generally involves checking the export or import declaration form, packing list, etc. For example, customs officers will inspect carton boxes to ensure that the shipment information is consistent with the export declaration form, such as the product name, quantity, and so on.

Checking the real situation to prevent smuggling and tax evasion

There are instances when a certain type of cheap product has a low tax refund rate but uses another HS code to obtain a high tax reimbursement.

Conducting effective administration and supervision

Customs inspection is an important means of supervision to ensure that all export or import businesses are safe, clear, and clean. Relevant data is also useful for compiling statistical information about a country’s foreign trade.

2. How Customs Inspections Work

Customs inspection works in 2 situations:

Situation 1 — Random Control by the Customs System

In the customs computer system, imported and exported goods have been classified and set with risk parameters. The larger the risk parameter, the higher the probability of inspection.

Situation 2 — Manual Control by Customs Officers

The main reason for manual control is that there is something wrong or suspicious with the declaration information submitted to the customs authorities. For instance, if customs officers have doubts about the contents of your declaration form, they will manually issue instructions on the customs computer system. That is, they will examine whether this batch of goods is consistent with the information recorded in the document.

In general, the customs inspection rate is about 5%. Note that this ratio is subject to change from time to time. For instance, during a certain period, U.S. Customs will conduct quick and intensive inspections of some products that are prone to infringement. However, such situations are rare as a whole.

3. Shipments That are Easier to be Inspected by Customs

From the customs perspective, sensitive goods are usually high-risk. The main reason is that such products are easy to produce high export tax refunds or falsely high tax refunds. Therefore, customs would focus on the export prices of these goods. Additionally, for sensitive goods, many freight forwarders choose to mix sensitive goods into general cargo to facilitate customs clearance. Therefore, sensitive goods are more likely to be inspected by customs.

In export and import, common sensitive products include the following 5 types:

Products with Batteries

Items with batteries, such as toys, are hot-selling products. Due to safety concerns about built-in battery shipping, customs authorities conduct stringent examinations of such products.

Branded Products and Luxury Goods

Customs mainly checks whether these products are fake or not. Take the counterfeit products inspected by US customs for example. The most common branded product types include clothing and accessories, consumer electronics, shoes, watches and jewelry, handbags and wallets, etc. Data on fake products seized by U.S. CBP (Customs and Border Protection) shows that over half are these types of brand items.

Liquid, Powder, and Other Unstable Items

Common examples include cosmetics, such as facial masks, perfumes, lipsticks, etc. These items are prone to changes during transportation, resulting in heat generation and explosion.

Optical Disc and CD Products

These products usually come with high political or cultural risks. The risk exists if there is internationally confidential content involved or any coverage of political, economic, cultural, and ethical content.

Food and Medicine

Common examples include meat, seeds, kitchen flavoring, and various drugs, etc. These items may have the risk of biological invasion. So, the import and export customs officers strictly review the quarantine certificate and conduct random checks according to their experience and government policies.

In addition, if there is a tax reimbursement increase for a certain commodity, the customs will step up efforts to inspect this product type during this period. This is because there might be tax fraud.

4. What Are Customs Officers Looking For?

Customs officers primarily focus on the following points:

• Checking if the declared cargo is the same as what is described in the submitted documents.
• Inspecting for contraband or dangerous goods.
• Looking for products that may infringe on intellectual property.
• Checking for false or incomplete customs declarations.

Customs inspections specifically focus on the following 8 aspects:

1. Product Name

Customs carefully examines whether the declared product name matches the actual cargo type. If there is a discrepancy, Customs will further evaluate whether it is an evasion of declaration or false declaration. Two common errors include:

• Confusing the product’s usual name and formal name.
• Combining multiple product names to save time. This can lead to the product price, net weight, and quantity being higher than what they really are.

If Customs detects that the declared product name differs from the actual cargo, they will analyze the case and take measures, which could include imposing a fine or destroying shipments.

2. Weight

Customs examines whether the declared gross and net weight matches the weight of the actual goods. For example, if freight is charged by weight, using the gross weight to calculate the net weight will lead to an inconsistency with the actual net weight and is easy to detect.

The allowable weight error range is 3% up and down. This is because weighed measurements can’t be so accurate. In practice, the error scope is usually at 1%. For example, if the declared container weight is 10 tons, but the actual container weight is 10.1 tons, this is acceptable.

3. Total Quantity

When examining goods, customs officers often do not count packages one by one but instead check the carton box number according to the data written on the declaration form. This is to prevent the concealment of certain products.

The most common issue is that the actual total quantity of goods is larger than the declared number. This is because the customs declaration form is usually prepared before the goods are packed and shipped. If there is an increase or decrease in the number of cartons actually loaded into the container, the declared number needs updating, which is easy to forget. For example, the last packed carton, samples, and free gifts need to be counted in the declaration form.

4. Intellectual Property Infringement

Customs strictly checks for intellectual property infringement. If products have brands, trademarks, or copyrights, Customs will examine the brand authorization file. If not, Customs will judge whether this batch of shipments involves infringement.

5. HS Code of Products

Customs checks whether the product’s HS code declared to them is accurate or not. This is because the HS code relates to the product tariff rate. Using the wrong HS code for declaration can lead to paying less or more tax than required.

It is error-prone to classify multi-function products. For example, a tablet with a call function should be classified as a mobile phone rather than a tablet. The key is to use the customs HS code to declare your product, avoiding punishments from customs.

6. Product Price

For each item, the Customs system has recorded its HS code and price range into the database. The Customs system has set an early warning function. Once the declared value is lower or higher than the set range, the system will immediately inform the officer that there is a problem with the price. So, it is not possible to declare the product value as much as you want, which can easily be caught by customs.

7. Samples for Testing

This is rare and usually only applied to chemicals that can’t be judged by eyes and need testing. For example, dangerous and corrosive products.

8. Container Inspection

Customs checks the container carefully. Without a thorough inspection, it is hard to find any problems. Generally, Customs will carefully check special types of containers.

Onestopimport Supports Your Import Business in China

• Ensures the completeness and accuracy of customs declaration information.
• Helps you prepare all the necessary documents and certificates.

5. China customs inspections (4 methods & process explained)

When transporting LCL and FCL shipments from China, there are some differences in customs inspections that you should be aware of. Keep reading for more information.

LCL shipments

At the departure port in China, Customs carries out random inspections. If your cargo is correctly declared to customs and does not contain sensitive goods, Customs clearance usually takes 1-3 days.

The packages randomly picked for inspection will be taken to the customs exam area for a manual inspection.

Manual inspection method — This involves taking out goods from containers and unpacking carton boxes. Then, a customs inspector checks the actual shipment conditions. Bulk cargo inspection is done before loading into the container, so there is no need to open containers.

In most cases, customs officers conduct a partial inspection.

Partial inspection method — This involves inspecting some packages of your shipment according to a certain ratio. This proportion is subject to the inspection requirements that can determine the product name, specification, quantity, and weight of shipments.

For example, suppose a batch of shipments is 50 carton boxes in total. The inspector randomly unpacks 5 boxes. If there is something suspicious with 4 cartons, there will be a complete inspection. This takes more time.

Complete inspection method — This involves opening all your packaging boxes, and then the inspector will carefully check the product classification, specification, quantity, weight, and other details.

FCL shipments

For FCL shipments, the container has been sealed and will be carried by trailer to the customs inspection area for machine inspection.

Machine inspection method — This method uses high-tech means such as a weighing machine and an X-ray scanning machine to analyze and judge the actual conditions of goods. Usually, there is no need to open the container or unpack carton boxes.

If customs officers detect suspected items, they will require opening the container and unloading packages inside. Then, they will conduct a practical inspection. Once it’s confirmed that there is a problem, they will examine the entire container, i.e., complete inspection.

Helpful Tip

What is the process for customs inspection?

Once customs inspection has been decided, customs authorities will take the following steps:

1. Issue the “Letter of Notice of Inspection”

The notice letter informs that Customs will inspect your goods in a legal manner. The forwarder or customs broker will receive it.

2. Arrange the inspection plan

Customs officers usually make the schedule, as numerous goods require inspections. The inspection may take place the day after the decision-making date or a week later. Your cargo may not be able to ship on the original date and may have to wait for the next shipping date. Your freight forwarder will apprise you.

3. Inspection on the spot

Your Chinese suppliers or their clearance agent will arrive at the inspection area and move the goods to the designated site. Then, inspectors will conduct on-site examinations.

4. Signature after inspection

After the inspection, customs officers will issue a report. Your agent will sign it.

Onestopimport has long-term reliable customs brokers to facilitate the inspection process

You may think that goods will not encounter import customs inspections after export customs exams. However, the two do not affect each other. There is a chance that your shipment may be chosen for inspection by the import customs. I will use the US customs examination as an example.

6. The five most common types of customs exams in the US

Typically, imported goods are inspected by the U.S. Customs and Border Protection (CBP). Depending on the method of inspection, CBP customs exams can be divided into three types:

X-RAY Exam (VACIS/NII)

This is the most common inspection method, also known as the VACIS (Vehicle and Cargo Inspection System) or NII (Non-Intrusive Inspection) method. When containers arrive at the port of destination, they are scanned by an X-ray machine. Customs officers then review the images to determine the condition of the shipment. This is similar to having your backpack scanned when entering a subway. If there are no issues, the officer will release the container. This type of inspection usually does not affect the normal transportation of goods.

Tail Gate Exam

If customs officers still have questions about your container after the X-RAY Exam, they may open it and simply check the packages inside. Usually, this is not a complete inspection. If everything is normal, they will release your container.

Intensive Customs Exam

If there is a problem, officers will conduct the most stringent inspection: the Intensive Inspection Exam. The entire container will be delivered to a Centralized Examination Station (CES), which is a private firm authorized by US Customs. CES is responsible for opening containers, loading and unloading packages, and unpacking each carton. This facilitates a complete physical examination by customs officers. In case of suspicious items, officers take samples for testing. This is the type of inspection that buyers and suppliers fear the most. It can take anywhere from a week to 30 days, depending on how many other shipments are in the inspection queue.

In addition, CBP inspections can be divided into the following two types, based on the type of CBP team conducting the examination:

CET (Contraband Enforcement Team) Exam

This type of exam mainly checks for contraband items such as weapons and drugs.

MET (Manifest Examination Team) Exam

• This type of exam mainly checks whether the cargo matches the submitted paperwork, such as the manifest or packing list. After opening the container and unpacking the cartons inside, officers will examine the number of boxes, the product name and HS code, the declared value, and other details. Smuggling and infringement issues are also included in the officers’ checks.
• Apart from CBP inspections, some American functional departments have the right to inspect imported goods. For example, the FDA mainly inspects items related to the human body, such as cosmetics. The CPSC mainly checks products related to children’s safety, like toys. The FCC mainly checks communication-related items, such as wireless earphones. These departments can conduct inspections after CBP releases your cargo. If there is a problem, they will hold your goods.

7. Fees and Time for Customs Inspections

It is a common misunderstanding that Customs charges an inspection fee. In reality, Customs itself does not charge any fees. Rather, the fees are generated during the inspection process and include venue, equipment, and labor costs. Some examples of these charges are:

• Crane fees and weighing fees.
• All logistics fees from the point of shipment to the customs inspection site.
• Storage and/or demurrage/detention charges incurred while your goods await customs inspections.
• Any labor costs associated with sorting goods, unpacking, unloading, and reloading packages, as well as opening or re-sealing the container.

Labor costs tend to be the most significant portion of the fees, and the complexity of the inspection can also impact prices. In China, for instance, a customs inspection of one 40’GP or HQ is approximately $140, while one 20’GP is cheaper. It’s important to note that labor costs vary by country, so inspection fees will vary accordingly. For precise inspection fees, it’s best to ask your customs broker or freight forwarder. Your agent will pay first and collect this sum of money from you. Before paying, you can ask for the invoice to ensure that it is legitimate. Oftentimes, the port or transportation company will issue the official invoice for relevant charges.

Customs Inspection Time

Customs inspection time generally ranges from 2-15 days, though for more complicated inspections, it may take up to 20 days to a month, or even longer. In China, customs inspections are typically faster than in other countries.

8. What to do if your cargo is held at customs?

If your cargo is held at customs after inspection, Customs will issue a notice. It’s necessary to carefully read it and find out why the goods were detained. Then, take action to address the issue.

For example, if the HS code is incorrect, Customs will ask for a statement explaining why your product is misclassified and whether it constitutes tax evasion. Sometimes it may only be necessary to reclassify the item, revise the document, and pay a fine. Then, your goods will be released. If Customs officers don’t accept your explanation and think your freight involves major problems, they will hand it over to the anti-smuggling department for treatment.

If you lack certificates, you need to supplement relevant documents as required by Customs and submit them within the fixed time. For example, children’s toys imported into the US must have CPC, CPSIA, and ASTM F963 test reports.

If the declared value is lower than the range set by Customs and officers demand an additional tax payment, you must repay it to Customs within the specified time, then pick up your goods. If this time limit is exceeded, your cargo will be returned to the place of origin.

It is difficult to list all cases, so it is recommended that you find professional customs brokers to deal with cargo hold issues. Customs will determine whether to release your goods or not.

For detained and confiscated goods, Customs usually deals with them in one of two ways:

• Auction — target goods that are not specified by national laws and regulations.
• Destruction processing — destroy contraband items on the spot. For pirated CDs, illegal publicity materials, etc., there will be harmless destruction.

Conclusion

We hope this blog has given you a rough idea of customs inspections. If you have any further questions, please leave a comment below.

As a leading Chinese sourcing agent, Onestopimport has rich experience in helping clients source and ship products from China. We offer competitive product prices and, more importantly, the goods we export are rarely held by customs after inspections. For support with your import business, please contact us.