5 Key Clauses in a Customs Broker Contract

Hiring the services of a customs broker should be done clearly, transparently, and in full compliance with the law. To establish the obligations of both the customs broker and the client—in this case, the importer or exporter—it is recommended to define specific clauses within a service contract.

5 Essential Clauses in a Customs Broker Contract

Here are the five key clauses or provisions that should be included in a contract with a customs broker:

1. Compliance with Tariff and Non-Tariff Regulations

One of the main requirements for importing and exporting goods is adherence to tariff and non-tariff regulations. In some cases, the customs broker may request the importer to provide the tariff classification of the goods. However, under the law, the broker is ultimately responsible for the accuracy and truthfulness of the data and information submitted regarding the shipment.

Do you know how much a customs broker will charge for your transactions?

Article 162, Section II of the Mexican Customs Law states that:

“For goods subject to non-tariff regulations and restrictions that require compliance through an electronic or digital document,” the customs broker must record the corresponding acknowledgment in the customs declaration.

Additionally, Article 54 of the same law establishes that the broker is also responsible for:

“Ensuring the correct tariff classification and accurate determination of the commercial identification number, as well as verifying that the importer or exporter has the required documents to comply with other applicable non-tariff regulations and restrictions.”

2. Defining Who Bears Financial Responsibility for Incorrect Tariff Classification

The service contract must clearly outline who is financially responsible for any consequences resulting from an incorrect tariff classification.

According to Article 54 of the Mexican Customs Law, the customs broker is not liable for penalties related to non-compliance with non-tariff regulations, as long as the inaccuracies or falsehoods stem from incorrect data or documents provided by the importer or exporter.

Furthermore, the broker is not held responsible if they could not have reasonably detected such inaccuracies during an inspection, especially when the nature of the goods requires laboratory analysis or chemical testing, as determined by the Mexican Tax Administration Service (SAT).

3. Establishing Responsibility for Document Retention in Case of an Audit

When drafting the contract clauses, the importer may delegate to the customs broker the responsibility of maintaining the foreign trade records, ensuring that all necessary documents comply with current regulations outlined in the Mexican Customs Law and the General Rules of Foreign Trade.

According to Article 36-A of the Mexican Customs Law, the customs broker must transmit the records in an electronic or digital format as annexes to the customs declaration. This includes:

• The commercial invoice meeting all required criteria when customs value is determined based on the transaction value and exceeds the limit set by regulations.
• The bill of lading for maritime shipments or the airway bill for air shipments.
• Documents proving compliance with non-tariff regulations, issued in accordance with the Foreign Trade Law.
• Certificates of origin determining the goods' provenance for tariff preferences, countervailing duties, quotas, country-of-origin marking, and other trade measures.

4. Defining the Importer’s Obligations in Transactions Managed by the Customs Broker

The importer also has responsibilities in customs transactions handled by the broker. According to the Mexican Customs Law, one key obligation is maintaining an automated inventory control system that keeps an updated record of foreign trade goods, which must be accessible to customs authorities at all times.

Additionally, the importer is responsible for obtaining and maintaining documentation that verifies the origin and provenance of the goods. This is crucial for applying tariff preferences, country-of-origin marking, countervailing duties, quotas, and other trade-related measures, as required by the Foreign Trade Law. Importers must provide this documentation upon request from customs authorities.

More importer obligations can be found on the SAT website.

5. Agreeing on Legal Advisory Services in Case of a Dispute with Authorities

In the event of any legal issues arising during foreign trade operations, importers should have legal support and guidance. The contract should explicitly state that the customs broker is required to provide legal advisory services when needed.

As mentioned in the article 5 Mistakes a Customs Broker Can Make That Could Affect Your Importation, the customs broker must be knowledgeable, experienced, and well-informed to carry out foreign trade operations effectively. However, the broker is not a legal entity with the authority to resolve legal disputes. Therefore, they must rely on specialized trade law attorneys to fulfill this obligation.

Learn More About Customs Brokers and Foreign Trade

For more information on these and other contract clauses that should be clearly defined in writing from the outset, consult the experts at Aduaeasy.