Meaning
Regulatory examinations evaluate customs declarations, commercial invoices, and financial records long after imported goods have left customs control. Performing a post clearance audit allows border control authorities to verify customs valuation and origin claims across historical import volumes. Importers and commercial distributors undergo these administrative reviews to confirm that landed cost declarations reflect true transactional values including royalties and assist costs.
Documentary Review
Customs inspectors examine accounting ledgers, purchase orders, shipping manifests, and bank transfer records to detect hidden import costs. During a post clearance audit, auditors compare declared transfer prices against intercompany contracts to ensure that price adjustments or retrospective rebates were properly declared for duty assessment. Verification teams analyze freight bills and insurance contracts to identify underdeclared customs values.
Tariff Reassessment
Examinations that uncover valuation errors or incorrect product classifications trigger formal demand notices for unpaid customs duties and import taxes. Importers must pay shortlanded duty amounts across multiple historical shipping entries spanning up to five years of operational history. When customs authorities reclassify products under higher tariff rates, distribution contracts determine whether the importer or the foreign supplier absorbs the unexpected duty burden.
Compliance Penalty
Administrative fines apply when regulatory audits reveal systematic underreporting, missing shipping documentation, or unapproved transfer price shifts. Severe non-compliance leads to revoked import licenses and mandatory pre-clearance inspections.
