Indirect customs representation: when someone else takes the risk instead of the importer – or does anyone?
At first glance, indirect customs representation seems like a simple and convenient solution for many businesses: customs procedures are handled by an agent, the administrative burden is reduced, and the process can be "outsourced." However, the question is not who submits the customs declaration, but who bears the customs and financial risks if something does not go according to plan. In practice, there are many misunderstandings surrounding indirect customs representation – and these often only become apparent during an official inspection.
What is indirect customs representation?
Under EU customs law, indirect customs representation occurs when a customs representative acts in their own name but on behalf of the importer (or exporter) during customs procedures. This is a significant difference from direct customs representation, where the representative acts in the name and on behalf of the importer.
However, the consequences of this legal construct are not merely formal: in the case of indirect customs representation, the customs representative and the importer are jointly and severally liable for customs payment obligations and certain infringements.
"The customs agent will take care of it" – the most common misconception
Many companies assume that if they hire an indirect customs representative, then:
the legality of the customs procedure is entirely the responsibility of the representative,
any customs deficiencies or fines "are not borne by the importer,"
the risks are transferred to the service provider.
However, this is only partially true, and it is often this misunderstanding that leads to serious financial consequences.
Who is actually responsible?
In the case of indirect customs representation:
the customs representative acts on his own behalf,
the importer and the customs representative are jointly and severally liable for customs and tax debts,
the authority may take action against both parties and is not obliged to choose between them.
This means that in the event of a subsequent discovery of:
an incorrect customs tariff number,
undervalued goods,
incomplete documentation,
or an incorrect certificate of origin
the authorities may not only demand unpaid customs duties or VAT from the customs representative.
When does indirect customs representation become truly risky?
Experience shows that problems arise particularly in the following situations:
the liability and compensation clauses of the customs representation agreement,
who provides the data for customs procedures,
what control and approval mechanisms are in place,
and how any infringement is divided between the parties under the agreement.
In many cases, customs liability is not determined where the administration takes place, but where business decisions are made.
A final thought
Indirect customs representation often seems like the "easier way" – but in customs law, convenience rarely comes with an automatic reduction in risk. The real question is not who handles customs, but who understands and consciously manages the underlying responsibility. This difference becomes truly apparent when the authorities ask questions.