Want to become a Customs Broker? You should! Customs Brokers provide an important service that help Importers and Customs and Border Protection facilitate the movement of goods into the United States. For that, you will need a Customs Broker License.
The procedure on becoming a Customs Broker is outlined in §111 of Title 19 of the Code of Federal Regulations (CFR).
What is a Customs Broker?
Customs Brokers are licensed professionals or entities that are allowed to conduct Customs Business on behalf of clients importing goods into the United States. Brokers assist their clients with issues concerning the admissibility of merchandise, its classification and valuation, the payment of duties, taxes, and other charges, and the refund, rebate, or drawback of those duties, taxes, or other charges.
So, how do you become a Licensed Customs Broker? Follow these steps!
Step 1: Be Eligible
- Be a citizen of the United States
- Be 21 years old at the time of submitting the license application
- Be of good moral character
- Pass the brokers exam (check out the pro-tip below)
Step 2: Pass the Customs Broker License Exam
The exam will test your knowledge of customs related laws, regulations, and procedures. Primarily, you will be tasked with navigating the Harmonized Tariff Schedule of the United States and Title 19 of the Code of Federal Regulations.
The exam is 4.5 hours long with 80 questions and given twice a year, once in April and once in October. You will need a passing score of 75% (60 correct questions answered).
Step 3: Submit Your Application and Fees
Once you pass the exam, you will receive an invitation to apply for your license from the port where you took the exam. The invitation will contain further instructions on how to submit your application for a license, any additional documents you may need, and the amount of application fees due to Customs and Border Protection.
Note: You can apply to any district for your license, regardless of where you sat for the exam or received an invitation to apply from.
CBP Form 3124 is the Application for Customs Broker License.
Step 4: Pass a Background Investigation
There is a multilevel background check that Customs and Border Protection will conduct on the applicant. Customs will ascertain facts related to the:
- Accuracy of the statements made in the application
- Business integrity of the applicant
- Character and reputation of the applicant
Customs can even request an in person interview with the applicant.
The Assistant Commissioner will issue a license if they find that the applicant is qualified and has paid all applicable fees.
Just a Reminder
The application process can take anywhere from a few months to up to 12 months. Applicants should be thorough and truthful on their applications as to not cause any delays, or worse, denial of their license. Grounds for denial of license are:
- Any cause which would justify suspension or revocation of the license of a broker under the provisions of §111.53
- The failure to meet any requirement set forth in §111.11
- A failure to establish the business integrity and good character of the applicant
- Any willful misstatement of pertinent facts in the application for the license
- Any conduct which would be deemed unfair in commercial transactions by accepted standards
- A reputation imputing to the applicant criminal, dishonest, or unethical conduct, or a record of that conduct
Should the applicant be denied a customs broker license, a review process is outlined in §111 of 19 CFR that allows the applicant the further opportunity for the presentation of information or arguments in support of the application.
Pro-Tip: How to pass the Customs Broker License Exam
The Customs Broker License Exam is designed to determine the individual’s knowledge of customs and related laws, regulations and procedures, bookkeeping, accounting, and all other appropriate matters necessary to render valuable service to importers and exporters.
Before you can take the exam make sure that you qualify to sit for the exam by:
- Being 18 years old
- Being a United States Citizen
- Not being an Officer or Employee of the United States Government
Sign up for the exam! The exam is given twice a year; once in April and once in October. Make sure to check Customs and Border Protection’s notice of examination page for registration deadlines and examination fees.
Prepare your materials and study for the exam. The test is open book! You will need your own current copies of the Harmonized Tariff Schedule of the United States and Title 19 of the Code of Federal Regulations. CBP will also notify the test takers of any extra directives that will be tested on.
The secrets to passing the Customs Broker License Exam are test familiarization and ability to index through the HTSUS and 19 CFR. Customs and Border Protection makes available all past exams and answer keys. Go through recent exams one by one until you build up your ability to find the answers in the HTSUS and 19 CFR. By the 4th or 5th practice exam, you will be have a solid understanding of where to find the answers.
Customs Broker Jobs and Salary
Brokers usually work for Brokerage Firms or for Freight Forwarders that are also Customs Brokers. Some Customs Brokers work for importers in compliance, auditing, or purchasing positions. Other brokers have their own self-employed practices.
Customs Broker Salary ranges start from $40,000 for entry level “entry writers” or “import specialists” to the median of $65,000. Licensed brokers in management and director positions can make upwards of $90,000 to $120,000.
Should you get your Customs Broker License?
There are currently about 11,000 active licensed brokers in the United States. Value of imports into the United States are currently over $2.5 Trillion! As the world becomes more globalized, Customs Brokers will be uniquely situated in the United States to provide guidance to importers navigating US trade regulations.
If you work for a Customs Brokerage or a Freight Forwarder AND you qualify to sit for the exam, the answer is a clear “Yes!” You will be receiving the only license in the field of supply chain and logistics that is recognized by the US Federal Government.
If you work for an Importer or Exporter, studying for the exam and receiving your license will definitely expand your knowledge of US Customs Laws and add a layer of credibility to your resume. The answer is again, “Yes!”
Getting your Customs Broker License is a serious commitment. You will have to pass a rigorous exam and multilevel background check. The whole process can take up to to a year, but being licensed is definitely worth it.