Customs brokerage is a profession that involves the 'clearing' of goods through customs barriers for importers and exporters (usually businesses). This involves the preparation of documents and/or electronic submissions, the calculation (and usually the payment) on behalf of the client of taxes, duties and excises, and facilitating communication between the importer/exporter and governmental authorities. Customs brokers in the USA will often prepare and submit documentation to notify or obtain the clearance from other government agencies such as the Food and Drug Administration (FDA), the United States Department of Agriculture (USDA), the Fish and Wildlife Service, and many others. Customs brokers need to be familiar with the Tariff Schedule, a listing of duty rates for imported items, and the regulations governing importations found in the Code of Federal Regulations Title 19, known as 19 CFR. For example, a customs broker may need to advise an importer regarding country of origin marking requirements or the precise paperwork requirements for a clothing shipment subject to quota/visa requirements. Knowing the requirements of each type of import can avoid costly delays or seizure of the merchandise. Many customs brokers specialize in certain types of transactions, such as wearing apparel, perishables, or clearing the crew and manifest of large cargo vessels. Customs brokers can be located at inland "ports" to clear merchandise sent "in bond" but most are located at major airports and harbors with international traffic. Customs brokers normally arrange the transhipment or local delivery of cleared merchandise through relationships with trucking companies and others. Customs brokers must pass an examination and background check to become licensed. Customs brokers are not government employees and should not be confused with Customs agents, although in some countries the term customs agent may mean customs broker.
Custom brokers may be employed by or affiliated with freight forwarders, but may be independent businesses or may be employed by shipping lines, importers, exporters, trade authorities and customs brokerage firms.
A freight forwarder (often just forwarder) is a third party logistics provider. As a third party (or non asset based) provider a forwarder dispatches shipments via asset-based carriers and books or otherwise arranges space for those shipments. Carrier types include waterborne vessels, airplanes, trucks or railroads.
Freight forwarders typically arrange cargo movement to an international destination. Also referred to as international freight forwarders, they have the expertise that allows them to prepare and process the documentation and perform related activities pertaining to international shipments. Some of the typical information reviewed by a freight forwarder is the commercial invoice, shipper's export declaration, bill of lading and other documents required by the carrier or country of export, import, or transshipment. Much of this information is now processed in a paperless environment.
The FIATA short-hand description of the freight forwarder as the 'Architect of Transport' illustrates clearly the commercial postition of the forwarder relative to his client. In Europe there are forwarders that specialise in 'niche' areas such as Railfreight and collection and deliveries around a large port. The latter are called Hafen(port) Spediteure (Port Forwarders). A forwarder in some countries may sometimes deal only with domestic traffic and never handle international traffic. (see also Forwarding Agent).