July 2010

Welcome to the July 2010 newsletter from Customs Clearance Ltd.

We hope you weren’t impacted by the fire at Heathrow on Friday 9th July. It broke out around lunchtime in a Servisair cargo warehouse on the airport perimeter and resulted in a 400-metre exclusion zone for traffic. The fire was brought under control by around 100 firefighters and fortunately nobody was injured. Whilst the airport continued its business as usual, traffic was disrupted in the surrounding area and a thick pall of black smoke could be seen for miles.

More recently, on Tuesday 27th July a Lufthansa cargo plane carrying 80 tonnes of freight crashed and ‘split in two’ at Riyadh Airport in the Saudi capital. The crew are reported to have survived and are being treated in hospital. You can read more about this story on the IFW web site here.

The news is a little brighter for the team at CCL. We had a great time at the well organised Triangle World Mail and Express Europe event in Copenhagen in June, lots of connections, plenty of meetings. If you want to catch us in the Far East, we’ll be at the 7th WCA Sino-International Freight Forwarders Conference at Asia World Expo in Hong Kong from 26th to 29th September. We love meeting clients, partners, associates and people who don’t know us yet but want to find out more, so let us know if you plan on being there and want to connect.

If you’re off on vacation this summer, don’t forget you can call on us to assist, if you should find that amazing chest of drawers, fabulous silk carpet or staggeringly beautiful handmade whatchamacallit abroad and need to get it home. Enjoy your summer break, but make sure you take our number with you!

As usual we hope you find this issue of value, and don’t forget, for any customs and importation queries, make our friendly and approachable Customer Services team on +44 (0)20 8231 0900 your first port of call.

Rudee is on the run! Beep Beep!! We have our very own Roadrunner. Rudee is running the Royal Parks Half Marathon in October, in aid of MIND, one of CCL’s sponsored charities. If you’re feeling generous and you want to support Rudee and a very worthy cause, check out his page on Virgin Money Giving here.

Caveat Emptor – Buyer Beware! Customs Clearance Ltd has been in the business of assisting the clearance of legitimate shipments through customs for two decades. We believe – and our customers tell us – that we provide an expert professional service. Our aim is always to ensure that our customers abide by the requisite rules and regulations governing the goods which they are shipping. This helps to expedite their shipments through customs and this in turn enhances our customers’ commercial standing and reputation. When we refuse to accept the information provided about a shipment, or when we insist that taxes are applicable where it might appear they could be avoided, it is because in reporting cleanly and honestly to HMRC on your behalf, we are acting in your best interests.

Where a customs broker is prepared to ‘bend the rules’ for you, there may appear to be short term benefits. But the cost of this approach could be high, as HMRC has wide-ranging powers to apply penalties. So before you consider engaging a customs broker who is offering you a little fancy footwork, think about the potential impact to your business – not just in fines and penalties but in restrictions on your ability to trade and in serious cases, even imprisonment.

A different kind of Q&A – Rudee takes the chair: This month we thought we’d answer a few of the more general questions that come Rudee’s way, with a mini-interview.

Q: Rudee, tell me about you and your company, how long have you been in this business?

A: I've been involved with the freighting/logistics industry since 1985 when I started as an apprentice in a freight forwarder’s Import Department. Since then I’ve worked with various organisations in the airfreight cargo and courier industry at Heathrow Airport. I founded CCL in 1990 and I’ve made other contributions to the industry too, such as guiding the software development for the C88 entry declaration which has made this process efficient and reliable.

Q: "Customs" seems to be a very general term that is used in the transportation business. What is "customs"? Who are these people? What are they trying to accomplish?

A: Customs is a generic term used throughout the world. It stands for the recognised government body responsible for border control, import and export of goods (commodities) and the policing of all traffic coming in and out of a country. In the UK, Customs is HMRC "Her Majesty's Revenue & Customs". HMRC looks after the collection of all taxes, duty, VAT and excise as well as control of illegal substances, contraband, counterfeit, drugs, etc.

Q: What does CCL do to ensure a client’s goods move through Customs smoothly?

A: CCL ensures that the correct paperwork is received and presented to HMRC and that an entry declaration meets the requirements and follows the complex rules, regulations and guidelines imposed by HMRC. We are also on hand to assist HMRC with any consignment that needs a documentation examination or a physical inspection. This helps to speed up the clearance process if there are any issues, as we are there to mediate on the client’s behalf.

Q: It seems like CCL moves material through the process faster and more efficiently. What is the difference between the clearance process with a company like CCL versus a large integrator?

A: CCL has the flexibility to think laterally in identifying clearance solutions for our clients. We are small and nimble and offer a service which is efficient, cost effective and bespoked to each individual client’s needs. But we are also substantial and well established enough to offer added-value to our clients in, for example, helping them to secure new business.

Q: How do the custom officials decide which shipments to review?

A: Most shipments are reviewed randomly. Around 1 in 10 shipments will go Route 1 on entry. Route 1 specifies a documentation examination only. Occasionally a Route 1 will be reselected to Route 2, which is a physical examination. Because all entries are logged electronically, HMRC looks for our assistance in detecting rogue importers or exporters. If values do not equate to the commodity description, size, pieces or package weights, this alerts HMRC and will invariably be the catalyst for a Route 2 review.

Additional duties on goods imported from the US: Since 2005 additional customs duties have been applied on the import of certain goods from the USA, as a result of what’s known as the ‘Byrd amendment’. Whilst the Byrd Amendment has been repealed, illegal subsidies to US businesses still continue and it is for this reason that the number of goods on which retaliatory rates are applied has been expanded.

You can click here to access HMRC’s CIP (10) 28 on this subject, which includes a full list of the goods which now attract the 15% additional Import Duty.

A mini Coffee Break Story: Couldn’t you have stopped the madness?

It was the wife that spotted it. On holiday in Florida, we were passing time in a rainstorm, wandering around this massive furniture warehouse type place just outside Naples. There’s money down there – big money – and a lot of it goes into bricks-and-mortar. It’s all about opulence, extravagance and filling big, huge homes with fancy stuff. Special treatments – trompe l’oeil and faux finishes – marble baths, gold taps, big pools, fancy features and the like. And chandeliers. Gigantic glass chandeliers with thousands of pieces, hung in massive atria – all guaranteed to deliver that elusive ‘wow’ factor.

She saw it. Like a lioness homing in on its prey, she spotted the chandelier we apparently had to have for our new place. A 5-foot long waterfall of multi-coloured glass and tiny, delicate bulbs – I admit it was pretty. But… but… It was five thousand dollars. And once she’d seen it, nothing else would do.

We’d pushed the boat out and stretched our finances to breaking point for the house, but she was still spending, and there wasn’t much I could do to stop her. I could see the veins standing out on her neck as she engaged with the salesman. Would they ship to the UK? Please say no. Yes, of course they would. Drat! Although they could pack it up, they clearly had no idea how to get it to the UK, or what was involved. Even then I thought I might be saved, but then the wife pulled out her iPhone and before I could stop her, she’d Googled “UK Customs Clearance” and come up with a name – Customs Clearance Ltd. She even made the call then and there, got a local shipping contact, had the forms faxed to the shop and tied up the deal so fast it made me quite faint.

So, Customs Clearance Ltd, back there in the UK, calmly awaiting the arrival of one magnificent, delicate and very, very expensive chandelier which definitely doesn’t qualify as a holiday souvenir, just whose side are you on, guys? You made it too easy! Couldn’t you have stood in the way of this credit-busting purchase? Couldn’t you have said, “oh, that’s far too tough for us to handle”? Couldn’t you have stopped the madness? No. You guys are just too efficient!