11-3.

Overview

IINO san

Would you like to study the import customs clearance process for air transport?

Yeah, but isn’t air basically urgent?
I don’t like being rushed.

Rookie

IINO san

Well, that’s how air transportation goes. So, it’s important to understand the process and respond appropriately and thoroughly.

….. Ino san doesn’t get angry this time!

Rookie

Learning Points

• Customs Procedures in Air Import

Air Import Customs Clearance Procedure

Air transport is faster than maritime transport; therefore, expedited customs procedures are required.

Customs clearance for air imports proceeded as follows.

IINO san

Well, we’ll explain one by one.

1. Receive S/A from Exporter

Once the flight is confirmed on the export side, Shipping Advice (S/A) will be emailed to the importer.

S/A includes the following documents:

• Air Waybill
• Invoice
• Packing List
• Permits or certificates required by regulations
• Catalog or Material Safety Data Sheet (MSDS)
• Certificate of Origin, etc.,

The S/A content is similar to maritime transport, but an Air Waybill is used for air transport.

Once the S/A arrives, we have to check there are no errors in the document details, right?

Rookie

IINO san

Yes, that’s right. It’s the same as maritime transport.

Air Waybill

The Air Waybill (AWB) doesn’t permit cargo transfer through endorsement as it is not a negotiable instrument. That’s why the cargo ownership belongs to the consignee on the Air Waybill.

Regarding Letter of Credit (L/C) transactions, the consignee’s column should be the issuing bank on the importer’s side.

Arrival Notice

An A/N serves as an alert or notification that the cargo is about to arrive. In maritime transport, the A/N is generally sent to the importer or customs broker 1-2 days before the vessel arrives.

However, as speed is crucial, the A/N is issued when the aircraft departs from the exporting airport. Then, it is sent to the destination via email or other means.

KEY POINT

The documents used are different from those used by sea.

• Air: Air Waybill 
• Sea: Bill of Lading (Sea Waybill, Expressed B/L)

IINO san

Speed is the top priority. The notification may be sent by email or phone.

2. Break Down ULD

The cargo taken off the aircraft is brought into the airline’s bonded warehouse and then unpacked and sorted. These activities are collectively referred to as “breaking down.”

Generally, various companies’ cargo is loaded together onto ULDs. Therefore, unpacking is necessary for each shipper’s items separately.

IINO san

By the way, the temporary bonded storage area for air transportation is referred to as bonded warehouse. It serves as a cargo storage facility near the arrival and departure areas of aircraft.

ULD

ULD (Unit Load Device) is a loading device such as pallets or containers used to carry cargo. Utilizing these allows for the efficient loading and unloading of cargo from aircraft.

IINO san

The lockdown in Shanghai during the COVID-19 pandemic led to delays in air cargo, primarily due to a shortage of labor for breaking down operations.

Unpacking operations can be challenging when there is a shortage of workforce.

Rookie

Container Types

Pallet Types

3. Request Import Procedures to Customs Brokers

The consignee will email the S/A documents to the customs broker to proceed with the import declaration.

IINO san

Unlike the B/L of maritime transport, the consignee can receive the goods without endorsement. Because the Air Waybill is not a negotiable instrument.

We don’t even have to submit the original!

Rookie

4) Arrange Internal Transportation

It is advisable to arrange for transportation to ensure swift and prompt pickup. The free time for air transportation is short, typically within 24 hours starting from 8 a.m. the day after arrival.

IINO san

I think it’s better to entrust the trucking arrangements to the customs broker. This way, it can be coordinated with the customs clearance timing!

No matter what happens, it’s a relief.

Rookie

In the case of L/C Transactions

Air transport cargo can be received once the Air Waybill is submitted and the owner shows they are the consignee. However, specific procedures are required for Letter of Credit (L/C) transactions.

In L/C transactions, the consignee’s column on the Air Waybill will be the issuing bank.

In this case, the importer will submit the following documents to the negotiating bank to obtain a Release Order:

• Collateral or promissory note
• Air Trust Receipt

Release Order (R/O)

Release Order is the document in which the consignee of an air waybill instructs the airline to release the cargo to another party. This is attached to the A/N.

As the consignee, the bank signs and issues the Release Order. By submitting the release order with the bank’s signature to the airline, the consignee can obtain the D/O.

5. Import Declaration

Upon confirming cargo transfer into the bonded area, the customs broker proceeds with the import declaration on behalf of the importer.

The declaration is made to the customs office overseeing the bonded area where the cargo is stored. The declaration is conducted using an online system.

6. Cargo Release

The consignee will pick up the cargo from the bonded warehouse upon receiving import customs clearance approval.

IINO san

From the aircraft’s arrival to obtaining import permits, the average processing time is approximately half a day, around 12.8 hours in Japan.

Wao, it’s speedy!

Rookie

Summary

In this topic, we explained the process of air import. The key points to note are as follows:

• Prompt action is essential in all aspects
• An original Air Waybill is not necessary
• Due to short free time, prompt arrangements for domestic transportation are required
• Special arrangements are required in the case of L/C transactions

IINO san

You need to be careful as there are differences in the specifics compared to ocean transport.

Take the Test

Reinforce your understanding of this topic by working through the exercises. Attempting the exercises without referring to the material as much as possible is advisable.

IINO san

The act of “remembering” helps it sink in your memory.