Custom Clearance

Custom Clearance
man filling up a document

Customs clearance refers to the movement of cargo through a customs authority, so that the goods can be shipped from one country to another.

Depending on the context, customs clearance can also refer to a specific document that is issued to a shipper by a national customs authority. It serves as proof that the shipment has been authorised and all customs duties have been paid for. This legal instrument grants permission for goods to enter or leave the country.

Whenever you ship items across borders, you will require customs clearance for your goods.

Customs clearance can be a hassle-free and cost-efficient affair when handled by professionals. Contact us to learn more about our services!

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Who provides custom clearance services

Custom clearance services are provided by customs clearance brokers and freight forwarders.

Customs Clearance Brokers

Customs clearance brokers are businesses or individuals that are licensed to act as middlemen between exporters, importers and a government’s customs agency.

They are only involved during the customs clearance process, and play no part in the transportation of goods from one country to another.

Freight Forwarders

Freight forwarders mainly serve as an intermediary between shippers and transporters. They are involved in the shipping of goods on behalf of a cargo owner.

In some cases, freight forwarders can also be licensed to provide customs clearance services.

They are ideal for clients who are looking for a one-stop solution for both their shipping and customs clearance needs.

Benefits of engaging a custom clearance service

Fast and Hassle-free

As there are many rules and regulations to follow, customs clearance can be a confusing and frustrating process for those without prior experience.

Having your paperwork handed by professionals would help to simplify the clearance process. This could also reduce the delivery duration of your cargo.

Cost-efficient

Engaging customs clearance services can be cost-efficient as professionals will be handling all the paperwork on your behalf.

This means you can avoid spending unnecessary money and time on documents that are not essential.

Reliable and Experienced

Customs clearance service providers are experts in the field of import and export clearance. They are able to streamline the entire process and advise you on common mistakes to avoid.

Their knowledge and experience will certainly give you confidence and set your mind at ease.

Custom Clearance Procedure in Malaysia

There are many steps involved during the customs clearance procedure. These are the main steps that you will need to be aware of when going through the process.

customs clearance process in malaysia infographic

1. Seek approval from external agencies

Approval from the relevant authorities at the destination country must be sought when shipping certain kinds of goods. This can be done by applying for a customs import permit in the destination country.

For example, the import of all food-related goods into Australia must first be approved by the New South Wales Food Authority; an Australian government statutory board.

2. Apply for a binding ruling

A binding classification or ruling enables importers to establish the country of origin, classification and valuation of the cargo.

This helps the destination country determine the tariffs and duties to be imposed on imported products in advance.

3. Complete clearance documents

Your cargo can only be shipped out after all applicable customs clearance documents have been provided and accepted by customs authorities.

The list of documents required for customs clearance include (but are not limited to):

4. Sign a customs bond contract

A customs bond contract must be signed by you, the customs authorities and the customs clearance service provider if the cargo being transported is estimated to be worth more than a certain value. This value differs depending on the destination country you are importing into.

The customs clearance service provider acts as a guarantor for you, and ensures that all import duties and taxes are paid for.

5. Checking of shipment paperwork

A customs officer will do a thorough inspection of all your paperwork to ensure they are complete and error-free.

6. Verifying of tariffs and taxes

Once the paperwork has been checked, the customs officer will proceed to verify the duties to be imposed on your cargo. The fees may vary depending on the type and value of the goods being shipped, and specific import regulations in the receiving country.

7. Pay taxes and duties

At this juncture, the customs authority will request payment for all the taxes and duties incurred.

By engaging the services of your own customs clearance provider, payment will be processed on your behalf during customs. This is also known as Delivered Duties Paid (DDP).

Note!

After your shipment arrives at the destination country, and if taxes and duties have yet to be paid, your shipment will be identified as Delivery Duty Unpaid (DDU). The customs officer will redirect your cargo to an individual customs service provider to collect payment.

This can get very expensive, so it’s recommended to pay your duties with your own customs clearance service provider beforehand.

8. Release of Shipment

After all outstanding duties have been settled, your shipment will be allowed to pass through customs for delivery.

Still have questions about the customs clearance procedure? Consult our customer service team at Haulx Malaysia to clarify your doubts!

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How much is the Custom Clearance fee in Malaysia?

Customs clearance fees are dependent on a number of factors such as the value of the imported goods, the classification of cargo, and the origin and destination of the shipment.

How is customs duty calculated in Malaysia?

Malaysia’s customs duties are often imposed on an ad valorem basis (a percentage of the goods’ customs value). Depending on the classification of the cargo involved, duty rates can range anywhere from 2% to 60%.

Certain categories of goods such as raw materials, pharmaceutical products and food necessities may be exempted from customs duties or subjected to reduced rates.

As an estimate, the customs duty of goods imported into Malaysia can be calculated as such:
(Value of Goods + Freight Costs + Insurance Charges + Any Additional Costs) × Duty Rates

Note!

Customs duty fees should not be confused with import taxes. Import taxes refers to the additional cost of importing products into the destination country.

For example, all imported goods in Malaysia are subjected to a Sales & Service Tax (SST) of 10%. Depending on the type of good, some are taxed at a reduced rate of 5% while others are exempted from sales tax.

Why choose Haulx Malaysia?

Licensed in Customs Broking

With our relevant licences, Haulx Malaysia is recognised by customs authorities as a professional customs clearance service provider.

Quality customer service

We place great emphasis on customer service and strive to meet all your needs. You can expect your queries and concerns to be answered within 1 working day.

Wealth of experience

M&P International Freights has been providing freight forwarding and customs clearance services for over a decade. We have a team of experienced professionals whom you can trust to get the job done reliably.

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FAQs about Custom Clearance in Malaysia

How long does customs clearance take in Malaysia?

Once a package arrives in Malaysia, it will only be released once all duties and taxes have been paid for. If there are any issues with the documentation or shipment, the goods may only be released after 24 to 48 hours from their arrival.

Are there any ways to expedite the customs clearance process?

While there are no specific ways to hasten the customs clearance process, you still can ensure the entire procedure moves along smoothly.

To help the customs authority better clear your customs, you should verify that you have submitted all the relevant clearance documents and made payment for all customs duties and import taxes imposed on your goods.

What is the difference between export and import clearance?

Export clearance refers to the clearing of customs at the country of origin, to enable goods to be shipped out of the country.

Meanwhile, import clearance refers to customs clearance at the destination country, to allow cargo to be shipped into the said country.

Why are my goods stuck in customs?

There could be several reasons why your goods are stuck in customs:

  • Pending duty and tax payment confirmation from the customs authority
  • Cargo needs to be physically examined by the customs authority or relevant agencies
  • Customs authority does not agree with the valuation or classification of your goods
  • Commercial invoice could be missing key information
  • Your goods have been confiscated by the relevant authorities

What happens if my goods are confiscated?

Your goods may get confiscated by customs authorities if it was shipped without the required licences or permits. Your shipment may also contain items that are illegal for export or import.

When your goods are confiscated, they will usually be detained by customs authorities for a few days. An inspection and physical examination will also be carried out for cargo that is suspected to contain prohibited goods.

If you are unable to provide a valid reason for the shipping of those goods, your cargo will not be cleared and may be confiscated indefinitely.