The logistics industry is filled with jargon, acronyms, and multiple terms for similar services. In the past, we’ve helped by clearing up confusion around NVOCCs and freight forwarders. Today, we’re breaking down key differences between licensed customs brokers and freight forwarders.
A freight forwarder (FF) is an organization that organizes cargo throughout the entire journey, from origin to destination. They’re adept at arranging land, ocean, and air exports, which means they aren’t as limited in their options as other classifications may be.
FFs work with organizations to make sure cargo gets from point A to point B as efficiently as possible. Plus, since they often deal with exports, they can offer advice to the company they’re serving. Keep in mind, though, that they are not required to be certified by U.S. Customs and Border Protection (CBP).
In short, FFs provide:
- Supply Chain Oversight. Freight forwarders take care of the logistics required to get cargo where it needs to be. They tackle any hurdles that may appear along the way.
- Flexible Modes. Freight forwarders can offer air, land, and ocean shipment options, which means they can adjust customers’ cargo as needed as situations develop across the supply chain.
- Export Guidance. To be clear, freight forwarders are not required to be licensed by CBP. However, since they’re essentially travel agents for cargo, FFs can give advice about common exports and regulations that may affect them.
LICENSED CUSTOMS BROKERS
Licensed customs brokers focus on preparing and clearing shipments across the U.S. border. Unlike freight forwarders, licensed customs brokers are required to pass the CBP’s Customs Broker License Examination. This ensures customs brokers are knowledgeable about imports and can offer solid council to the organizations they serve. After passing the test, they must apply for a license and wait for CBP to approve the certification.
Customs brokers are there to assist customers with imports and exports and rules surrounding them. Although importers may be responsible for complying with customs, customs brokers can offer advice, assistance, and clarification on any requirements that may affect customers’ cargo at the border.
Licensed customs brokers provide:
- In-Depth, Licensed Knowledge. Licensed customs brokers must pass an exam that covers topics like Harmonized Tariff Schedules (HTS), Title 19 of the Code of Federal Regulations (CFR), and more.
- Import Guidance. Licensed customs brokers are essential when it comes to understanding how CBP regulations apply to a specific organization or shipment. Customs brokers can offer advice, explain the implications of rules, and ensure organizations take steps to legally import their goods.
- Shipment Preparation. Like anything related to customs, imports take a lot of paperwork. Licensed customs brokers can complete much of this work for organizations, which allows their leadership to focus on other matters in the meantime.
Luckily, TOC Logistics happens to be both a freight forwarder and licensed customs broker. In fact, 50% of our customs brokerage team as a whole is licensed, which means we’re ready and waiting to assist our customers and answer any questions they have. Why wait? Reach out to our team to get started.