Customs House Agents (CHAs) & Their Role In Global Trade

Customs clearance is one of the most crucial steps in international trade. Most exporters dread this stage as they ship products to their customers in the overseas market. This is because of the strict customs regulations and stringent checks involved in the process. But did you know there is a way to speed up the customs process whilst carrying it out efficiently? You can do so by seeking assistance from a customs house agent (CHA). What responsibilities do CHA agents undertake? How are they different from freight forwarders? How to select a competent CHA agent? Let’s find out!

CHA Agents and Their Primary Responsibilities in the Customs Clearance Process

Customs house agents possess the required knowledge and skill to take you through the customs clearance process and ensure compliance. The expert guidance of these licensed professionals help exporters sail through the complex customs clearance procedure smoothly. Also referred to as a customs broker, they serve as an intermediary between the exporters/importers and the customs authorities. They are mainly responsible for preparing and submitting customs documentation and ensuring compliance with customs regulations. Their primary responsibilities also include calculating customs duties, coordinating with customs authorities and conducting inspections.

Why Businesses Require CHA Agents For Smoother Customs Operations?

Here is why businesses require CHA customs brokers: 

1. Expert Knowledge of Customs Regulations: A CHA possesses expert knowledge of the customs regulations. He helps gather necessary documents and carry out duty calculations efficiently. Seeking their guidance lowers the scope of errors that may lead to or penalties.
2. Streamline Customs Clearance: CHAs streamline the customs clearance process by coordinating with customs authorities. They are experienced in handling inspections and interacting with port officials. This helps clear the goods quickly and reach their destination on time.
3. Regulatory Compliance: A CHA customs broker ensures that the shipments meet the required customs standards thereby reducing the risk of non-compliance. They inform the businesses of any changes in customs regulations to avoid hassle.
4. Focus on Core Business Activities: By outsourcing customs operations to a CHA, businesses can focus on their core activities. This may include production, marketing or sales. 

What Does A CHA Agent Do?

Here are some of the key tasks that a CHA agent requires handling:

1. Assistance with Import and Export: They help businesses arrange necessary documents and fulfil essential customs requirements to import and export goods efficiently.
2. Clearance of Shipment: A CHA broker must ensure compliance with customs regulations to enable smooth clearance of shipment as exporters transport their goods overseas.
3. Customs Audits: Customs agents also require handling the customs audit process. This involves reviewing the customs declarations and relevant documents supporting the same and verifying them to ensure accuracy. 

Criteria for Selecting A Competent CHA Agent

It is important to select a knowledgeable and experienced agent to ensure smooth and efficient customs clearance of your goods. If you are looking for one then considering the following points will help in choosing the right one:

1. Experience: It is suggested to look for a CHA with a good amount of experience in the field. An experienced agent is more likely to be familiar with the complexities of customs procedures and requirements related to different types of goods. One who has handled the kind of goods you are dealing in is an even better choice. He will be able to handle the task better even when faced with challenges such as errors in documentation or other discrepancies.
2. License: He must have a valid CHA license. It serves as a proof that he has the necessary qualifications and authorization to handle customs clearance on behalf of clients. Do not forget to verify the validity of the license.
3. Track Record: His professional record will give you an insight into his ability to handle the task. Try to gather information about your shortlisted agents from reliable online sources to find out if they have been successful in clearing shipments and meeting deadlines. Thus will help you understand how reliable and efficient they are.
4.  Services Offered: The range of services offered by a CHA should meet your needs. It is important to select a customs house agent who can provide services that cover all aspects of customs clearance to ensure a seamless process.
5. Cost Involved: You must also consider the cost involved in the process. While it should fit your budget however in an attempt to strike a cost-effective deal you mustn’t compromise on the quality of service. As you inquire about the charges, do not forget to understand any hidden or additional charges for the services.

Eligibility Criteria For Becoming A Licensed CHA Agent In India

The eligibility criterion to become a licensed CHA agent in India has been given under Section 146 of the Customs Act, 1962. Here is a look at the same:

• The applicant must have a post graduate degree in law or should be an MBA or CA.
• He/ she should possess at least 3 years of experience in the customs field. 
• He/ she should have cleared the Form G examination conducted by the customs department.
• He/ she must have bank-certified assets amounting to a minimum of INR 5 lakhs.

CHA Agents Vs. Freight Forwarders

While many reputed freight forwarders help with the customs clearance procedure, they may not possess as much knowledge about the field as an experienced CHA agent. Let us understand how the two differ from each other and why CHAs prove to be more helpful when it comes to the aforementioned procedure:

How ShiprocketX Helps with Customs Clearance?

ShiprocketX has a wide network of reputed global shipping partners that have a track record of ensuring smooth transition of goods across borders. They simplify the complex customs clearance process for businesses by helping with the necessary paperwork. This lowers the chances of delays or rejections due to incorrect or missing documentation. They also manage duty calculations thereby simplifying the procedure further.

In addition to this, by integrating with eCommerce platforms, ShiprocketX facilitates seamless order management. This ensures that the shipping labels, invoices and other necessary documents are compliant with both local and international regulations. This reduces customs-related issues and ensures timely deliveries.

Thus, ShiprocketX empowers businesses to focus on growth without worrying about the complexities related to customs clearance.

Conclusion

Customs house agents have eased the customs clearance procedure for businesses. These agents are granted license if they fulfil the eligibility criteria under Section 146 of the Customs Act, 1962. It has been observed that businesses that seek assistance from CHA brokers are able to get through the customs clearance process speedily without facing any hindrance. By hiring a knowledgeable and experienced agent, you can manage this otherwise cumbersome task with ease.

They help with the documentation as well as other nitty-gritty’s involved in the process. This includes carrying out inspections, coordinating with the customs authorities, carrying out inspection and calculating the customs duty. The key is to hire a reliable CHA who has an expertise in the field. He must have at least a few years of relevant experience, a valid CHA license and an impressive track record. Moreover, he should offer services at competitive price without compromising on the quality of work.