Customs Broker Responsibilities and Ethics
This domain tests the duties attached to the license itself: diligence, candor, recordkeeping, and the line between advocating for a client and facilitating a violation.
Licensing and status
- A license is issued to an individual; a permit authorizes a broker to transact customs business at a port, and a national permit covers all ports.
- Each permit holder must designate a responsible supervising broker.
- Brokers file a triennial report and notify CBP of changes in address, licensing status, and corporate structure.
- A written power of attorney from the client is required before filing.
Ethical obligations (19 C.F.R. Part 111)
- Exercise due diligence in preparing and filing documents; do not file an entry you know or should know is false.
- Disclose information material to the transaction; do not withhold adverse facts.
- Never use a client's power of attorney to transact business for the broker's own account.
- Keep records for 5 years and produce them to CBP on request.
- Disclose fees and do not split compensation with unlicensed persons.
Worked example
A broker discovers after summary that a client's classification is wrong and duties were underpaid. Correct path: advise the client in writing, prepare a Post Summary Correction if liquidation has not occurred, and if it has, evaluate prior disclosure under 19 U.S.C. §1592(c)(4) with counsel. Silence, or quietly correcting only future entries, exposes broker and importer alike.
Traps that cost marks
- Believing the broker may rely on importer data without review - due diligence is not delegable.
- Confusing a license with a permit.
- Assuming client confidentiality permits withholding information from CBP.
- Signing or using a power of attorney for the broker's own transactions.