Customs controls for businesses

Customs controls are at the heart of international trade, ensuring the safe and regulated movement of goods across borders. Implemented by the Customs and Excise Administration, these controls play an important role not only in securing supply chains, but also in protecting the economic, environmental and health interests of countries. This article explores the multidimensional nature of customs controls, their strategic importance in maintaining the global trade order, and the challenges they represent in a constantly changing world. Navigating between complex regulations and the need for trade facilitation, we reveal how these procedures are adapting to meet the modern demands of international trade.

‍

‍

Understanding customs controls

Definition and significance

Customs controls are a set of procedures carried out by customs authorities to inspect, regulate and monitor goods crossing international borders. These controls are crucial to ensuring that international trade is conducted in accordance with the laws and regulations in force, thereby guaranteeing fair competition, consumer protection and the security of the countries involved.

The relevance of customs controls extends far beyond simply regulating trade; they play a decisive role in preventing the illegal trafficking of drugs, weapons, counterfeit goods and other prohibited goods. What's more, these controls help to safeguard public health by preventing the entry of dangerous products or those that fail to comply with sanitary and phytosanitary standards. Customs controls are therefore essential to maintaining the security and integrity of world trade, protecting the economic and social interests of every country.

Core objectives

The objectives of customs controls are many and touch on various aspects of the smooth running of international trade and the protection of companies. These objectives include :

• Protecting the national economy: by regulating the import and export of goods, customs controls help protect local industries from unfair competition and support national economic policies.
• Public safety: by filtering the entry and exit of goods on the territory, customs play a preventive role against the risks associated with the circulation of dangerous or illegal products.
• Tax revenue collection: customs duties and taxes on imported goods are a major source of revenue for the state, financing essential public services.
• Trade policy enforcement: through customs controls, countries implement trade policy measures, such as quotas, preferential tariffs and economic sanctions, to regulate foreign trade in line with their strategic interests.

Customs controls are a fundamental pillar of the international trading system, ensuring a balance between the free movement of goods and the protection of national and international interests. Through their actions, they help to create a secure, predictable and equitable trading environment for all players in world trade.

‍

‍

Regulatory framework for customs controls

European Union legislation

Customs legislation in the European Union (EU) has been significantly influenced by major world events, notably the terrorist attacks of the early 21st century. In response to these threats to international security, the EU has strengthened its customs controls by adopting measures to improve the safety and security of the Schengen area's external borders. These measures include the introduction of the Entry Summary Declaration (ENS) prior to the arrival of goods in the EU, as well as the obligation for exporters to submit electronic data for tracking goods. Such initiatives underline the EU's commitment to preventing illegal activities while facilitating legitimate trade.

In addition,Authorized Economic Operator (AEO) status has been developed to reward companies that meet certain security and compliance standards. This status offers advantages such as reduced customs controls and priority treatment of goods, illustrating a balance between securing the supply chain and the fluidity of international trade.

Impact of world events

The EU's customs legislative framework has also evolved in response to other global challenges, such as the COVID-19 pandemic and growing trade tensions. The pandemic highlighted the need for agile customs controls capable of adapting to changing circumstances, notably by facilitating the rapid import of essential medical supplies. The response to the crisis included the temporary relaxation of certain controls to speed up the movement of critical goods.

At the same time, international trade tensions have led to a reassessment of customs policies, with greater emphasis on protecting domestic markets and preventing dumping. This has resulted in stricter application of anti-dumping duties and safeguard measures, demonstrating how the regulatory framework can be adjusted to protect the EU's economic interests in the face of unfair trade practices.

‍

‍

The strategic and multidimensional objectives of customs controls

Customs controls serve a wide range of objectives vital to the smooth running of international trade and the protection of society. Ranging from securing cargo to ensuring tax compliance, these objectives reflect the complexity and importance of the tasks assumed by customs authorities.

Freight safety and risk prevention

Cargo safety and security are at the forefront of customs' concerns, with strategies designed to block the way to potential threats. Authorities implement rigorous measures to detect and prevent terrorism, arms trafficking and other security risks. Risk analysis, based on accurate data and artificial intelligence, enables suspicious shipments to be identified before they even reach the border. These procedures are crucial to keeping the global supply chain free from disruption, while ensuring the smooth flow of legitimate trade.

Tax and customs compliance

One of the pillars of customs control is to ensure the fiscal and customs compliance of goods crossing borders. This involves verifying the accuracy of customs declarations, the correct calculation of customs duties, and the application of appropriate taxes on imported and exported goods. These controls ensure that commercial transactions comply with current legislation and that tax revenues due are correctly collected, thus contributing to the financing of public services and economic equity.

Combating illicit trafficking and counterfeiting

Customs authorities play a key role in the fight against illicit trafficking and counterfeiting. By closely monitoring the movement of goods, they strive to prevent the illegal trade in drugs, counterfeit goods and other prohibited items. Efforts in this area not only protect intellectual property rights and public health, but also enhance national security. Through these actions, customs help to establish a healthy and reliable business environment, essential for consumer confidence and economic prosperity.

‍

‍

Products and operations under surveillance

Customs controls cover a wide range of products and operations, reflecting the complexity and diversity of international trade. From the verification of everyday consumer goods to the inspection of specialized industrial equipment, the breadth of goods controlled testifies to the commitment of customs authorities to ensuring security, compliance and economic protection.

Scope of controlled goods

The diversity of products subject to customs controls is immense, encompassing virtually every conceivable category of goods. This includes food products, medicines, clothing, toys, electronics, machinery, industrial components, and many others. Each product category is subject to specific regulations, which may vary according to its nature, origin, destination and intended use. For example, food and pharmaceutical products are rigorously inspected for health safety issues, while technological equipment may be examined for intellectual property and national security considerations. This comprehensive approach ensures that all aspects of international trade are monitored for the well-being of consumers and the economic integrity of nations.

Specific accisian controls

Excise controls represent a specific aspect of customs procedures, targeting products subject to excise duty such as alcohol, tobacco and fuels. These products, because of their nature or impact on public health, are subject to additional taxes and strict regulations. Accisian controls aim to ensure that these goods are correctly declared and taxed at the applicable rates, to prevent tax evasion and illegal trade. In addition to the usual inspections, this can include checking documentation, analyzing supply chains, and examining production practices. These specific measures help protect tax revenues, while tackling the public health problems associated with the consumption of these products.

{{pop-up-component}}

‍

The customs control process

The customs control process, both rigorous and essential, relies on a combination of physical and documentary checks, as well as the use of technology for greater efficiency and accuracy.

Control procedure

The customs control process depends on the nature, origin and destination of the goods, and the associated level of risk. The customs declaration is lodged when the goods are ready to be physically examined by customs, right at the border office. This step is crucial to initiate the examination of the information provided, enabling the authorities to ensure that the goods comply with the applicable regulations.

Physical inspections, although not systematic, are triggered by specific criteria or particular suspicions. These inspections may involve direct examination of products, the taking of samples for further testing, or the use of scanning equipment for non-intrusive evaluation. In parallel, documentary checks examine invoices, certificates of origin, import/export licenses, and any other documents required, to authenticate shipment details and ensure the legality of the commercial operation.

Non-physical checks are an essential aspect of the customs process, involving in-depth verification of data and documents associated with goods. These checks can include the analysis of customs declarations, commercial invoices, certificates of origin, and other relevant documents to ensure the legitimacy of commercial transactions. The aim is to detect any irregularities or fraud without having to physically inspect the goods, thus reducing time and optimizing resources.

Technology and risk analysis

Theuse of technology and IT systems plays a key role in optimizing customs controls. Thanks to global databases and advanced risk analysis tools, customs authorities can effectively assess the degree of risk associated with each consignment. These systems can identify shipments requiring special attention, based on criteria such as carrier history, product type, trade routes and global trade trends.

Integrating artificial intelligence and machine learning into these processes enhances customs' ability to predict potential risks, improving the accuracy of targeting controls and reducing processing times. This risk-based approach enables resources to be concentrated on shipments most likely to contravene regulations, while facilitating the passage of low-risk goods.

‍

The 3 types of customs control

1. Documentary control: at the heart of customs regulation

Within the spectrum of customs controls, documentary control takes two main forms: on initial presentation of the customs declaration, and retroactively, known as a posteriori control. This dual approach enables customs authorities to monitor commercial transactions across borders continuously and effectively.

Initial document control is the first level of screening, where the documents accompanying the customs declaration are scrutinized for compliance with current regulations. This step is crucial to prevent any regulatory discrepancies at the very start of the import or export process.

A posteriori (ex-post or ex-antes) control, on the other hand, represents a complementary approach, carried out after the goods have been cleared through customs. This procedure involves a retrospective examination of relevant commercial information provided by economic operators. The aim is to audit commercial documents, financial records, physical inventory and other relevant elements to ensure that operations fully comply with customs regulations. This retrospective analysis is vital for measuring traders' adherence to standards, and for fine-tuning customs risk management strategies.

A posteriori control stands out for its role in continuously improving compliance with regulations. By assessing operators' degree of compliance after the fact, customs can adjust their surveillance methods and target potential risks more precisely. This audit method enables a more strategic allocation of customs resources, and encourages operators to voluntarily align themselves with regulatory requirements, thus promoting faster, smoother customs clearance.

Recognized for its importance in strengthening customs risk management strategies, post-clearance auditing has been formalized at international level through the adoption of specific guidelines by the World Customs Organization (WCO). These guidelines aim to standardize this audit practice, reflecting a modern and efficient approach to customs regulation.

2. Physical inspection: a critical step for safety and compliance

Physical inspection is the second essential pillar of customs surveillance operations. This type of control takes place either immediately after presentation of the customs declaration, or later in specific circumstances, such as in a customs warehouse for special procedures. Through this process, customs authorities carry out a direct inspection of goods to ensure that they comply with the information declared and with current regulations.

At the time of declaration: When goods are presented to customs, physical inspection can be triggered on the basis of various criteria, such as the results of risk analysis or indications of potential non-compliance. This direct inspection enables customs officers to verify the accuracy of the information provided in the declaration, such as the nature, quantity and value of the products.

In customs warehouses: For certain categories of goods placed under special arrangements, physical checks can take place in designated facilities, such as customs warehouses. These secure spaces allow goods to be stored temporarily while awaiting final clearance, providing an additional opportunity for customs to carry out detailed checks where necessary.

Physical control is important not only to prevent fraud and illicit trafficking, but also to protect public health and safety. By examining goods in a tangible way, customs can detect prohibited goods, counterfeits, or those posing risks to health and the environment. This step also ensures that all appropriate taxes and customs duties are correctly assessed and collected, thus helping to finance public services and protect the national economy.

Physical checks are therefore an indispensable component of customs authorities' efforts to maintain safe and fair international trade, by ensuring that only compliant and legally authorized goods cross borders.

3. Sanitary controls: Phytosanitary and veterinary

The third essential type of customs control, crucial to the protection of public health and environmental safety, concerns sanitary controls. These inspections, which are divided into phytosanitary and veterinary checks, are imperative and must be carried out before the customs declaration is lodged, thus forming an essential prerequisite for the goods clearance process.

Phytosanitary controls: Specifically focused on plant and agricultural products, these controls aim to prevent the introduction and spread of harmful organisms. They play a key role in protecting ecosystems, crops and forests from potentially destructive insects, diseases and weeds. Shipments must comply with international and national plant health standards, often attested by phytosanitary certificates issued by the exporting country.

Veterinary controls: These inspections target products of animal origin to prevent the transmission of contagious diseases. By checking products for compliance with health regulations, including the presence of veterinary drug residues or contaminants, these controls ensure the safety of animal and human populations.

European regulatory framework: Under European regulations, specifically Article 57 of Regulation (EU) No. 2017/625, it is stipulated that sanitary and phytosanitary checks on imports must be carried out at the first point of entry into the territory of the European Union. This requirement ensures that goods comply with high European health and safety standards as soon as they arrive, even before any consideration for a specific customs regime.

‍

‍

The Authorized Economic Operator (AEO) program

The AEO program stands out as a major initiative to enhance the security of the international supply chain, while accelerating trade for compliant companies. Recognized worldwide, it marks companies that achieve high standards of security and customs compliance.

Benefits for companies

Obtaining AEO status signals a theoretical reduction in customs controls, priority in the processing of necessary inspections, and international recognition facilitating global trade. It also represents a guarantee of quality and reliability, strengthening the company's position in the global supply chain.

Certification criteria and process

To become an AEO, companies must demonstrate strong compliance with customs regulations, rigorous management of security risks, stable financial solvency, and a commitment to high standards of operational management and record control. The process requires a detailed application and audit by customs authorities to verify compliance with these criteria.

For more details on Authorized Economic Operator (AEO) status, including its advantages, the criteria to be met, and the certification process, please consult our full article "All you need to know about Authorized Economic Operator (AEO) status: advantages, criteria and recognition".

Challenges and impact on international trade

Customs controls, while essential to the security and regulation of international trade, present a complex set of challenges for authorities and economic players alike. The balance between security and trade facilitation, as well as navigating between challenges and opportunities, are at the heart of contemporary global trade concerns.

Balance between safety and ease of use

Customs authorities are constantly faced with the challenge of maintaining the security of borders and the international supply chain, while promoting smooth, unhindered trade. This delicate balance requires the adoption of strategies that identify and minimize the risks associated with inbound and outbound goods, without impeding the rapid pace of international trade. Advanced use of technology, such as risk analysis systems, and partnership programs with the private sector, such as AEO status, are examples of how Customs is modernizing its approaches to achieving this balance. By these means, they aspire to greater efficiency, minimizing unnecessary inspections and prioritizing resources towards high-risk shipments.

Challenges and opportunities for economic players

For companies involved in international trade, customs controls represent both a challenge and an opportunity. On the one hand, increasing regulatory requirements and controls can lead to delays, additional costs and increased complexity in business operations. These challenges require companies not only to be well informed about applicable customs legislation, but also to invest in risk management and compliance systems.

On the other hand, commitment to compliance and security can open significant doors. Companies that invest in secure, compliant business practices can benefit from accelerated procedures thanks to AEO status, an enhanced reputation, and stronger relationships with customs authorities. What's more, by navigating the regulatory landscape effectively, companies can discover new market and partnership opportunities, positioning themselves as leaders in a global business environment increasingly focused on security and transparency.

‍

‍

Towards a balanced future: customs controls at the heart of world trade

Customs controls are essential to the smooth running of international trade in today's globalized world. They embody a strategic response to the imperatives of security, regulatory compliance and trade fluidity, playing a pivotal role in the balance between the free movement of goods and the protection of companies against various risks.

The importance of these controls extends beyond simply securing borders; they are an essential component of the global economy, directly influencing the competitiveness of businesses, the protection of consumers, and the economic stability of nations. The challenges associated with their implementation, such as the need to constantly adapt procedures to new threats and technological developments, call for sustained attention and increased international cooperation.

At the same time, customs controls offer substantial opportunities for companies committed to compliance and operational excellence. Adopting international standards and obtaining recognized certifications, such as Authorized Economic Operator (AEO) status, can open up new avenues for simplifying customs procedures and speeding up the flow of goods across borders.

Faced with the challenges of international trade and the demands of a rapidly changing world, customs controls are positioning themselves as vectors of confidence and security. As we look to the future, it is vital that customs authorities, businesses and international organizations continue to work together to strengthen the security of the global supply chain, while facilitating efficient and fair international trade. Together, they can navigate the challenges ahead and exploit the opportunities to build a prosperous and secure future for global trade.