Trade compliance is of utmost importance to the operations of import/export companies. The relevant legal consequences may, on the light side, affect the customs clearance efficiency of the company. On the heavy side, they may cause a downgrading in its rating in China Customs’ AEO (authorized economic operator) programme, exposing it to serious fines and even resulting in jail time for its senior officers. Based on HaoLiWen Partners’ extensive customs law practice, we would like to share our observations on customs risk features and key aspects of trade compliance.
Customs risks may arise with a time lag in most cases. In practice, given a rapid clearance policy, customs tends not to check all documents or goods under a single customs declaration, so it can be difficult for an importer/exporter to detect the existence of any improper declaration at customs clearance. However, if customs later discovers any such improper declaration, it will conduct an investigation and pursue administrative penalties, or even criminal liabilities in the worst situation. Because of this hidden nature of incompliance, the customs risks are therefore often deferred, as they may come to light after the customs clearance.
Parry Zhou Hemin is a senior partner at HaoLiWen Partners, serves as associate professor at Shanghai Customs College, and was a former customs officer. He can be contacted on +86 21 5840 6188 or by email at [email protected]
Zhao Deming is a senior partner at the firm. He can be contacted by email at [email protected]
Han Shu is a partner at the firm. She can be contacted on +86 21 5840 6188 or by email at [email protected]