Understanding the customs clearance process is essential for anyone exporting or selling goods internationally. Before reaching their final destination, products must pass through the customs clearance process of the importing country.
Many factors can cause delays during customs clearance, including country-specific paperwork requirements, duties, taxes, and product restrictions. Familiarising yourself with the process helps ensure smoother importation.
What is customs clearance?
When a package arrives at a country's border for importation, it undergoes customs clearance. For low-value shipments, clearance can occur remotely in transit — known as express clearance — when the air waybill (AWB) and commercial invoice meet all import requirements.
Customs officials inspect shipments entering and leaving the country to verify documentation, assess costs, and check for applicable import licences and prohibited goods. The outcome is one of three results: cleared for delivery, held for further inspection, or rejected.
Customs clearance steps
1. Document inspection
Customs officers inspect commercial invoice (CI) documentation electronically before goods arrive at the border. Required documents typically include the CI, Bill of Lading (BOL) or AWB, and packing list — though requirements vary by country. Customs authorities may also require the manufacturer's name and address, and a detailed description of the items including intended use and form (e.g., liquid, lotion).
For example, South Korea's minimum required documents are:
Bill of Lading (BOL) or AWB
Commercial Invoice
Packing list
Maritime insurance
Import declaration
Proof of payment
Order confirmation
EORI and VAT numbers (where applicable)
Additional documentation may be required for special circumstances, such as agricultural products.
2. Duty, tax, and fee calculation
Customs officers assess applicable duties, taxes, and fees based on the goods' Harmonized System (HS) code classification, duty calculation methods, preferential origin, value compared to the country's de minimis values, Incoterm, and other factors. These determine the import's total landed cost.
3. Incoterm assessment
Incoterms define who is responsible for paying duties and taxes.
DDP (Delivered Duty Paid) — Duties and taxes are pre-paid, streamlining customs clearance. Managed by charging the full landed cost at checkout.
DAP (Delivered At Place) — Duties and taxes are not pre-paid. The carrier fronts the payment to customs and bills the customer before delivery, leading to longer delays and a poorer customer experience.
For tax-registered businesses sending shipments to countries with low-value tax schemes, the shipment is typically marked DAP and the seller remits the tax directly to the tax authority, avoiding customs holds.
4. Decision on shipment
If there are no issues during the previous steps, customs releases the shipment for delivery. If there are infractions, the shipment may be held or rejected.
UK returns note: For Returned Goods Relief (RGR) and Direct Return Facility Information (RFI) documents, the following are mandatory:
A wet or digital signature (typed signatures are not acceptable)
Use of the designated returns address only
Inclusion of EORI and VAT numbers
Failure to comply can lead to delays in processing returned shipments.
Avoiding customs delays
To minimise delays at customs:
Adhere to all trade regulations of the destination country.
Send packages as DDP whenever possible.
Register with a tax ID for countries with taxation schemes.
Ensure required documents and information are submitted to the designated shipping service provider by the stated deadlines, including tracking number and contact details.