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Six Things to Know About Becoming a Licensed Customs Broker

what is a customs broker

By Laurel Delaney. Import & Export Expert

Laurel Delaney is a successful entrepreneur, speaker, educator and author with more than 25 years of global business experience. She runs and firms specializing in international entrepreneurship and continues to devote her career to helping businesses go global. She is the author of Start & Run a Profitable Exporting Business published by Self-Counsel Press (2008), Exporting: The Definitive Guide to Selling Abroad Profitably published by Apress (2013) and Exporting Essentials: Selling Products and Services to the World Successfully (2014) also published by Apress.

In "Hiring a Customs Broker: How to Ensure the Importing Process Runs Smoothly ," I outlined what is a customs broker, what does a customs broker do and how to find a good customs broker. Here I'll shed light on the six things you need to know to become a customs broker.

1. You must be eligible. To become a customs broker you must be a U.S. citizen, be at least eighteen years of age, be of good morale character and not be a federal government employee at the time of the customs broker exam.

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If all of those apply to you, move on to No. 2. If even one of those items doesn't apply to you, stop here. You cannot become a customs broker at this time.

2. You must have knowledge of importing. Knowledge of importing means you must have an understanding of entry procedures, entry requirements. valuation, fines and penalties, classification, and the rates, duty, taxes and fees for imported goods. As a licensed broker. you submit necessary information and appropriate payments to Customs Border Patrol (CBP) on behalf of its clients and charge the clients a fee for this service.

It is important that you demonstrate responsible supervision and control during the import process. You will demonstrate this by passing an exam.

3. You must pass an exam. The exam is given at most CBP service ports (refer to state listing here: ) the first Monday in April and the first Monday in October. Make sure you apply at a port where you want to practice or transact customs business as a broker. You are responsible for bringing proof that you meet all the eligibility requirements as noted in No.

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1 (e.g. photo I.D. proof of registration). The examination lasts four hours and consists of

80 questions. Each question has a single best answer (in some cases as noted below, there can be two different acceptable answers); however, there is no penalty for guessing so you should answer every question. To pass the exam, you must achieve 75 percent correct answers or better. Should you fail to pass the exam, you can retake it until you pass. For exam questions and answer key, visit here .

Sample question:

A recent college graduate received her individually licensed U.S. Customs broker's license on December 5, 2009. On January 31, 2012, the individual is convicted of smuggling narcotics into the United States through the District of El Paso. On April 2, 2012, the broker applies for a District permit in Laredo, Texas. Which of the following statements is NOT true?

a. U.S. Customs and Border Protection (CBP) may suspend the individual's license for a period not to exceed one year.

b. CBP can revoke the individual's license.

c. The Port Director may deny the issuance a District permit for Laredo, Texas.

d. CBP may revoke the permit issued through El Paso.

e. CBP may immediately revoke the broker's license.

The answer is noted below.

4. You must submit a broker license application along with paying appropriate fees. The fee for the application is $200. There is also a fingerprint check and processing fee. As an applicant you must undergo a background investigation that includes a fingerprint analysis and a review of character references, credit reports and any arrest record. Note: Arrests or convictions do not necessarily preclude the issuance of a license.

5. Your application must be reviewed and approved by Customs Border Patrol (CBP). There are three levels of review: multiagency background investigation, a CBP port director secondary background investigation, and lastly, the same CBP port director forwards a recommendation to CBP headquarters in Washington, D.C. The Assistant Commissioner, Office of International Trade, will advise you on whether your application is approved.

6. You should plan about a year to get the license application done. The length of time it takes to complete the license-application process can vary depending on multiple factors, but generally an application can take anywhere from eight to 12 months to process.

Where to go for more information?

U.S. Customs and Border Protection

Trade Facilitation and Administration

Broker Compliance Branch

1300 Pennsylvania Avenue, NW

Category: Forex

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