由 caicai8478 “Mr. Wang, our shipments were detained by customs at the destination port!”
This is probably the news foreign trade professionals hate to hear. Shipments arrive safely across the ocean, only to be stuck at the “last mile.” Not only do these shipments incur hefty demurrage and storage fees, but they also risk returns or even destruction, ultimately leading to customer loss and loss of both goods and money.
How can you avoid this nightmare scenario? This article will outline the most common reasons for customs detentions when exporting to Southeast Asia and provide a clear prevention checklist and emergency response strategies to help you avoid these risks.
- Why Are My Shipments Detained? Eight Common “Minefields”
The root cause of cargo detentions is non-compliance. Here are eight common reasons for customs detentions in Southeast Asia:
Inconsistent or Incorrect Document Information
Description: This is the most common reason. Information on the commercial invoice, packing list, bill of lading, or certificate of origin (Form E) (such as product name, quantity, weight, amount, and consignee/consignor) is inconsistent.
Consequences: Customs suspects commercial fraud or tax evasion and will immediately detain the goods for inspection.
Commercial Invoice Issues
Underdeclaration: The declared value is significantly lower than the actual value or market price of the goods. This is a practice that customs targets.
Ambiguous Description: The product name is too general, such as simply “gift” or “parts,” making it difficult for customs to categorize the goods.
Consequences: Revaluation, back taxes, and significant fines.
Certificate of Origin (Form E) Issues
Information Error: The content of the Form E does not match other documents.
Failure to Comply with the “Direct Shipment Rule”: Transshipment through Hong Kong or other locations without obtaining a “Certificate of Non-Reprocessing” invalidates the Form E.
Consequences: The customer cannot enjoy tariff concessions, must pay the full back taxes, and the goods will be detained until the issue is resolved.
Issues with Importer Qualifications or Licenses
Description: The importer does not have the right to import the relevant product (e.g., API in Indonesia) or has not applied for an import license for the specific product (e.g., FDA license in Thailand, SNI certification in Indonesia).
Consequences: Goods are detained due to lack of legal customs clearance qualifications until the customer completes the necessary qualifications or are forced to re-export/return the goods.
Missing Product Certifications
Description: The product lacks the mandatory certifications required by the destination country, such as Indonesia’s SNI certification, Malaysia’s SIRIM certification, or the Philippines’ ICC license.
Consequences: The goods are deemed “non-compliant,” prohibited from import, and face return or destruction.
Product or Labeling Issues
Description: The product is counterfeit or infringing; or consumer goods lack local language labels (e.g., Indonesian or Thai).
Consequences: Infringing products will be confiscated and destroyed; labeling issues must be rectified before release, incurring additional fees.
Incorrect Customs Service (HS) Code Classification
Description: The HS Code provided by the exporter is inconsistent with the code recognized by the customs of the importing country, resulting in incorrect tax calculations.
Consequences: Reclassification is required, the difference in tax must be paid or refunded, and the process is delayed.
Other Unexpected Causes
Temporary changes in customs policies at the port of destination.
The importer is involved in a financial dispute or credit issue, resulting in the goods being detained by the court.
II. What to do if the goods have been detained? (Emergency Strategy)
Once you receive notification of a goods detention, remain calm and follow the steps below:
Step 1: Immediately contact the customer to clarify the reason for the detention.
This is the most critical step. Have your customer (importer) obtain the official detention notice from the local customs or their customs broker as soon as possible. This will clearly state the specific reason for the detention (e.g., under-declaration, missing XX certificate, etc.). Avoid making assumptions.
Step 2: Targeted measures based on the reason.
If it’s a document issue:
Action: Immediately prepare the correct documents and send them to the customer by courier or electronically.
Note: Modifying official documents such as Form E may require applying for a revision or reissue from the issuing authority (Customs/China Council for the Promotion of International Trade), which can take time.
If it’s an importer qualification or certification issue:
Action: Urge the customer to process and submit the relevant documents as soon as possible. These types of issues take a long time to resolve, so you need to follow up and provide necessary support (such as providing product technical specifications to assist with certification).
Warning: If the customer is ultimately unable to resolve the issue, consider returning the goods or re-exporting to a third country as soon as possible to minimize any losses from port demurrage.
If the issue is under-declared:
Operation: This is a difficult issue. The importer will usually need to cooperate with customs to explain the situation and accept a revaluation. The end result is often back taxes and fines. In this case, negotiate with the customer to share the losses and learn from this experience.
Step 3: Evaluate Costs and Make Decisive Decisions
Calculate the daily port demurrage and storage fees. If the cost of resolution (fines + rectification fees + additional freight) approaches or exceeds the value of the goods, negotiate with the customer whether to abandon the goods. Abandonment will be handled according to the legal procedures at the port of destination, and a handling fee may still be charged.
Step 4: Leverage Professional Support
Your freight forwarder and the customer’s local customs broker are key to resolving the issue. They are familiar with local customs procedures and unspoken rules and can provide the most direct solutions.
- The Smartest Strategy: Prevention (Prevention Checklist)
Prevention is worse than cure. Incorporate the following checklist into your standard export process:
[Pre-shipment] Communicate thoroughly with customers:
✅ Clearly inquire whether the product requires any special certifications/licenses (such as SNI, SIRIM, FDA, etc.) in the destination country.
✅ Confirm whether the importer is qualified to import the product.
✅ Verify the format and content requirements of all customs clearance documents.
[During Document Preparation] Ensure “Document Consistency”:
✅ Establish a document preparation-review-audit process to ensure 100% consistency of product name, quantity, amount, and consignee and consignor information on all documents, including invoices, packing lists, bills of lading, and certificates of origin.
[During Declaration] Adhere to compliance and truthfulness:
✅ Firmly refuse customer requests for “low-cost declarations” and clearly inform them of the serious consequences.
✅ Describe the goods clearly and specifically, using industry-standard terminology and avoiding generalities.
✅ Verify the HS code with the customer, especially for new products.
[Post-Shipment] Timely and Accurate Document Transfer:
✅ Before the goods arrive at the port, send complete and clear customs clearance documents (especially the original Form E) to the customer, or promptly process a telex release.
Summary:
Having goods detained is essentially a failure of risk control. The Southeast Asian market presents both opportunities and risks, and its complex customs landscape requires us to shift from reactive response to proactive management.