DC Velocity - May 2018

Flood of cross-border e-commerce packages challenges
customs authorities
The surge in cross-border e-commerce activity is strain-
ing the operations of world customs authorities that are
processing millions of international packages shipped
to consumers with systems and procedures designed to
support business-to-business commerce, experts say.
World Customs Organization (WCO) Secretary
General Kunio Mikuriya highlighted those challenges
earlier this year when he spoke of e-commerce’s rapid
growth resulting in a “tsunami of small packages” at
the 22nd Annual Northeast Trade & Transportation
Conference produced by the Coalition of New England
Companies for Trade (CONECT).
World customs agencies are accustomed to processing
large-scale transactions between established and familiar
players. However, e-commerce’s business-to-consumer
(B2C) transactions often involve a single shipment that
can be a “one-off” from small companies that customs
authorities do not know to individuals who are equally
unfamiliar. Sometimes, criminal enterprises or criminal
activity can be involved.

“Low value does not mean low risk,” said Amy Magnus, director of customs affairs and compliance for customs broker A.N. Deringer. Product descriptions may be incomplete or inaccurate, and declared values may be understated, Magnus said. Many of the orders fall below the importing country’s value thresholds and thus don’t require the filing of formal entry documents. Because of that, information provided to customs agencies is minimal, and in many cases, no advance electronic notification is required, she said.

Customs authorities also are under pressure to clear
time-sensitive e-commerce shipments quickly, some-
times without sufficient staffing to handle the surging
volumes, according to Magnus.

HEADACHES FOR CUSTOMS

For customs agencies, including U.S. Customs and Border Protection (CBP), this situation has created a number of challenges, Magnus said. Chief among them is security. Without access to detailed information, such