Sea freight between the US and Pakistan forms a crucial link in global trade, connecting significant industrial hubs and facilitating the exchange of large volumes of goods. With major ports like Karachi in Pakistan and Los Angeles in the US, sea freight remains a cost-effective solution despite being slower than air or rail transport. This method acts as a floating warehouse, efficiently moving goods at a fraction of the cost, making it a preferred choice for many businesses.

Challenges in Shipping

Customs clearance, unexpected duties, and paperwork errors can complicate the shipment process. Understanding the best practices and requirements for sea freight is crucial to ensuring a smooth journey. This includes smart packaging, knowledge of local laws, and strategic planning to avoid common pitfalls.

What is Customs Clearance?

Customs clearance is a formal process required to permit the entry or exit of goods to/from a country. This must be done by an authorized customs broker and involves declaring specific information about the shipment and the parties involved. This ensures that all goods comply with local and international regulations and that all duties and taxes are paid.

Information Required for Customs Clearance

To fulfill customs clearance procedures, you need to provide the following information:

Tax Information: Details of the importer and exporter.

Origin and Destination: The starting point and final destination of the shipment.

Transport Details: Name and country of the means of transport.

Goods Description: Number of packages, gross and net weight, volume, and description of the goods.

Payable Taxes: Information on taxes applicable to the imports.

Certain types of merchandise, such as health or pharmaceutical goods, may require additional inspections and certificates to prove compliance with relevant controls.

Who is Responsible for Customs Clearance?

The customs agent, representing the importer or exporter, is responsible for carrying out customs clearance. The agent deals with customs authorities, communicates necessary information or notifications from the customs office to the client, and pays taxes and duties on behalf of the importer/exporter.

Documents Needed for Customs Clearance

Customs clearance is a relatively straightforward process that requires the following documentation:

Commercial Invoice: This certifies the trading operation between the parties and includes fiscal data of both parties, a description of the cargo, the Incoterm under which the transaction is taking place, and the value of the cargo.

Packing List: Issued by the seller, this list accompanies the commercial invoice and details the merchandise (number and type of packages, weights, volume, etc.).

Bill of Lading (B/L): Issued by the transport company, this certifies that the goods have been loaded on board the means of transport. The customs agent must have original copies of this document.

Additional documentation may be required depending on the type of merchandise and the destination country.

Choosing Between FCL and LCL

Selecting between Less than Container Load (LCL) and Full Container Load (FCL) for shipping goods from the US to Pakistan depends on your shipment’s size and needs.

LCL (Less than Container Load):

This is ideal for shipments that do not require the full capacity of a container. LCL is suitable for shipments less than 13-15 cubic meters, offering price flexibility because you only pay for the space you use. For example, if you have 10 cubic meters of toys to ship from Karachi to California, you can use an LCL service, sharing the container space with other businesses and paying only for your share.

FCL (Full Container Load)

A cost-effective and secure option when your cargo exceeds 13-15 cubic meters. With FCL, your goods won’t share space with other shipments, and your container is securely sealed from origin to destination. For instance, if you are transporting 16 cubic meters of pharmaceutical equipment, using FCL ensures maximum control over your shipment.

Role of US Customs and Border Protection

The US Customs and Border Protection (CBP) is responsible for regulating international trade that enters and exits the US. This includes collecting import duties and enforcing regulations related to trade, customs, and immigration. The agency ensures the safety and security of the nation’s borders and plays a key role in enforcing trade laws.

Types of US Customs Inspections and Holds

US Customs may decide to hold your container for inspection either at random or due to specific suspicions. When this happens, the costs for the exam and any fees incurred fall under the responsibility of the shipper. It is important to know the types of US customs inspections and holds you may be subjected to:

Manifest Hold: This hold is placed when CBP needs to verify the contents of the shipment against what is declared on the manifest. If there are discrepancies or if the cargo poses a threat, the shipment may be seized or penalized.

CET Hold (A-TCET): The Container Eligibility Test (CET) examines containers arriving in the US to determine their eligibility for release. A hold by the Anti-Terrorism Contraband Enforcement Team (A-TCET) is placed on containers that may contain illegal contraband, aiming to stop terrorist threats.

PGA/Commercial Enforcement Hold: Participating Government Agencies (PGAs) like the FDA, USDA, and CPSC can place a hold on a container to ensure it complies with regulations. This hold prevents goods from being released until they are confirmed to be compliant.

Statistical Validation Hold: This hold is placed on containers when the goods listed on the manifest do not match the expected weight, value, etc. It is part of a policy to verify the accuracy of shipping data and combat smuggling.

Delays in Shipment

Shipping delays can be a significant concern when transporting goods internationally. Several factors can contribute to delays in sea freight, especially during customs inspections and holds:

Documentation Issues: Incomplete or incorrect documentation can cause delays as customs authorities need accurate information to process shipments.

Customs Inspections: Random or targeted inspections can lead to delays. Goods may be held for detailed checks, especially if there are discrepancies in documentation or concerns about the cargo.

Port Congestion: High traffic at ports can result in delays as ships wait for available berths to unload cargo.

Regulatory Changes: Changes in import/export regulations or trade policies can impact processing times and cause delays.

Security Concerns: Increased security measures can slow down the inspection process, especially for goods flagged as high-risk.

Conclusion

Selecting the appropriate shipping method, whether LCL or FCL, based on your cargo size and needs, further optimizes your shipping strategy. Being prepared for potential inspections and understanding the different types of holds can save time and money, ensuring that your shipments are handled efficiently.

At Studio East, we are committed to simplifying your international trade operations. Our experts provide comprehensive support throughout the customs clearance process, ensuring compliance and facilitating smooth transactions. By partnering with us, you gain access to valuable resources and expertise, enabling you to focus on your core business activities without worrying about the intricacies of customs procedures.

Take the next step towards seamless international trade by registering with Studio East!