Broker Doesn't Need to Receive Duties Directly From Importer, CBP Says

Customs brokers don't need to receive duties directly from an importer and can receive funds from a middleman, CBP said in a ruling issued Aug. 25 and released by the agency Sept. 6 (HQ H318461). The decision followed a request from World Customs Brokerage (WCB) for a binding ruling regarding broker relations with unlicensed persons. Both WCB and freight forwarder World Courier, Inc. (WCI) are subsidiaries of AmerisourceBergen Corporation, and WCI often forwards imports to WCB for customs brokerage services and bills and receives payment through WCI.

WCB wrote to CBP headquarters in April 2021 to inquire whether that activity violated the statute regulating broker relations with unlicensed entities. The letter said that following an introduction, WCB will correspond with the importer and obtain a Customs Power of Attorney and other information necessary, including "specific consent to the disclosure to the freight forwarder of records." CBP said that the key issue was whether or not WCI, as an unlicensed entity, was engaging in "customs business." According to WCB, the power of attorney forms lay out that when the importer is billed for brokerage services through a freight forwarder, "it is [WCB] and not the forwarder who is conducting Customs business ... ."

CBP headquarters agreed, ruling that while “Customs business” involves all activities involving the entry and admissibility of merchandise, its classification and valuation and the payment of duties or other charges, the forwarding of bills and payments through a third party doesn't amount to that party's direct interaction with CBP. “Customs business” also includes the preparation of documents intended to be filed with CBP and related activities, but CBP ruled that it is permissible for an intermediary to collect payment, so long as that entity doesn't interact directly with the agency or participate in decisions relating to those payments.