---
title: "Is Customs Clearance Required at All Links of Origin Port, Transit Port and Destination Port in Transit Trade?"
description: "Foreign trade enterprises engaged in transit trade often face risks of port detention，cargo seizure and even compliance penalties due to vague understanding of customs clearance requirements at each link. It is necessary to clarify the differences in customs clearance requirements among origin port，transit port and destination port，master the special rules for sensitive cargo and bonded transit，and ensure full-link compliance and avoid unnecessary losses through pre-document review，node connecti..."
url: "https://www.sh-zhongshen.com/en/qa/transit-trade-customs-clearance-requirements-origin-transit-destination-ports.html"
language: "en"
type: "Q&A"
category: "Entrepôt Trade Q&A"
datePublished: "2026-10-18"
dateModified: "2026-10-18"
brand: "Zhongshen Trading China"
answerCount: 7
---

# Is Customs Clearance Required at All Links of Origin Port, Transit Port and Destination Port in Transit Trade?

## Question

 I am a foreign trader engaged in hardware accessories export based in Shanghai. I switched to transit trade last month because the EU anti-dumping duty is too high. Previously, when my cargo transited via Penang, Malaysia, my forwarder said customs clearance was required. But this week I changed to a Singapore-based forwarder, and they said no customs clearance is needed at the transit port. I am totally confused! I have a batch of hardware goods with environmental protection coating to ship next week, which is a repeat order from my long-term customer. If the cargo is detained at the port due to customs clearance problems, I will not only have to pay port storage fees and breach of contract damages, but also may lose this big client I have cooperated with for 3 years. I am very anxious now and want to figure out clearly: which links of origin port, transit port and destination port require customs clearance in transit trade? For sensitive cargo like my coated hardware, are there any special requirements for customs clearance at the transit port? Besides, if I use bonded warehouse for transit, is it really okay to skip customs clearance? 

## Answers
                            
### Answer 1 — Best Answer

Customs clearance requirements for each link of transit trade shall be distinguished by node and cannot be generalized. First of all，for the origin port，no matter what transit mode you adopt，**export customs declaration and clearance** must be completed. This is a statutory requirement for cargo departure，and failure to complete it will directly result in the cargo being unable to be loaded and depart.

Customs clearance requirements at the transit port are divided into two scenarios: if general warehouse transit is adopted，formal customs clearance procedures must be completed，including declaring the attribute of transit trade and submitting documents such as transit guarantee letter，if bonded warehouse transit is adopted，formal customs clearance can be exempted through **bonded supervision mode**，but you need to apply for bonded warehousing filing with the transit port customs in advance. The cargo is under customs supervision throughout the whole process and shall not enter the local market of the transit country. For sensitive cargo such as coated hardware，MSDS (Material Safety Data Sheet) and coating composition test report shall be reviewed in advance before customs clearance at the transit port to ensure compliance with the dangerous goods supervision requirements of the transit country's customs.

At the destination port link，normal customs clearance shall be completed in accordance with the requirements of the importing country，and documents such as certificate of origin and bill of lading issued by the transit country shall be used to avoid triggering anti-dumping duties. Pre-document review shall focus on checking document consistency，to ensure that cargo information and transit route on the bill of lading，certificate of origin and packing list are completely matched，for connection of core nodes，the qualification of the transit forwarder shall be confirmed in advance，and the forwarder shall be required to synchronize real-time customs declaration status，for contingency plans，if the transit port temporarily requires supplementary customs clearance，you need to prepare emergency document templates in advance，and entrust a local agent to handle it urgently，after final compliance is achieved，all customs declaration documents shall be retained for at least 3 years for retrospective inspection by customs.

**status:** accepted
**Author:** Cindy Chen
**Date:** 2026-10-18

### Answer 2

A common misunderstanding in transit trade customs clearance is confusing "transit trade" with "transit transport". Transit transport only requires transit declaration and no formal customs clearance, but transit trade involves possible transfer of cargo ownership or warehousing operations, so the transit port needs to declare and clear customs according to the transit attribute.

If you fail to declare truthfully, the customs will assess the duty according to general imported goods, require you to pay high back duties and late fees, and even trigger price assessment disputes, leading to the cargo being detained at the port for more than 7 days and auctioned. It is necessary to submit the transit trade contract and cargo ownership transfer certificate to the transit port customs in advance, clarify that the cargo is only for transit and will not enter the local market. When the price is assessed, you need to provide the original purchase contract and transit fee certificate to prove the authenticity of the transit trade.

**status:** suggested
**Author:** Evelyn Li
**Date:** 2026-10-18

### Answer 3

The customs clearance process at the transit port of transit trade directly affects cargo title control and logistics timeliness. If you choose the bonded transit mode that does not require formal customs clearance, you need to ensure that the forwarder has the qualification for bonded warehouse operation, and obtain the bonded warehouse warrant immediately after the cargo enters the warehouse as the cargo title certificate.

If you use general transit customs clearance, you need to complete the bill of lading exchange procedures simultaneously to avoid cargo title disputes caused by the original bill of lading flowing to the destination port. If the cargo is detained at the port due to customs clearance delay, you need to apply for extending the free storage period immediately.

The free storage period of a common transit port is generally 3-5 days, which can be extended to 7-10 days by applying to the terminal through the forwarder. Meanwhile, you need to coordinate with the destination port customer to delay picking up the goods to avoid extra container detention fees and pickup breach of contract damages.

**status:** suggested
**Author:** Eric Zhou
**Date:** 2026-10-18

### Answer 4

Customs clearance operation of transit trade directly affects tax compliance. If customs clearance is not completed in accordance with regulations at the transit port, it may be recognized as local sales by the local tax authority, and you need to pay value-added tax (VAT) and income tax of the transit country. For transit trade adopting bonded transit mode, you can apply for VAT deferral, no need to pay VAT at the transit port, only need to pay customs duty and VAT at the destination port in accordance with the requirements of the importing country.

It is necessary to plan the tax structure in advance to ensure that the profits of transit trade are retained in the offshore account, avoid being recognized by the tax authority as transferring profits through related transactions due to inconsistent customs clearance documents, which triggers BEPS (Base Erosion and Profit Shifting) investigation. All documents of the transit trade, including logistics documents, payment certificates, contracts, etc., shall be retained for tax inspection.

**status:** suggested
**Author:** Kevin Lin
**Date:** 2026-10-18

### Answer 5

Customs clearance documents of transit trade are the core basis for foreign exchange receipt and payment compliance. If customs clearance is not completed in accordance with regulations, the bank will refuse to handle foreign exchange settlement or purchase because it cannot verify the authenticity of the trade.

It is necessary to ensure that the information on customs clearance documents is consistent with that in the foreign exchange remittance message, including cargo name, quantity, amount, transit route, etc. When using CIPS for cross-border RMB payment, you need to mark the attribute "transit trade" in the message and upload scanned copies of customs clearance declaration, bill of lading and other documents. If the foreign exchange receipt or payment is overdue due to customs clearance delay, you need to submit an application for delayed receipt/payment filing to the bank, explain the reason for the customs clearance delay, and provide the port detention certificate issued by the transit port customs to avoid being included in the foreign exchange supervision abnormal list.

**status:** suggested
**Author:** Lucas Liu
**Date:** 2026-10-18

### Answer 6

Customs clearance requirements for transit trade shall be clearly stipulated in the trade contract. If the forwarder fails to complete customs clearance as required by the contract and causes losses, you can pursue liability in accordance with the contract terms. It is necessary to add a "transit port customs clearance compliance clause" in the forwarder contract, which clearly requires the forwarder to ensure that the customs clearance process complies with the regulations of the transit country's customs.

If cargo seizure or port detention is caused by non-compliant customs clearance, the forwarder shall bear all losses including port storage fees and breach of contract damages. Meanwhile, it is necessary to stipulate in the contract with the destination port customer that "pickup delay caused by transit customs clearance delay shall not be deemed as our breach of contract" to avoid customer claims caused by customs clearance issues. If the cargo involves intellectual property rights, you need to complete the intellectual property customs protection filing at the transit port in advance to avoid cargo detention due to infringement during customs clearance.

**status:** suggested
**Author:** Daniel Xu
**Date:** 2026-10-18

### Answer 7

If customs inspection is triggered during customs clearance at the transit port of transit trade, you need to prepare a full set of documents in advance, including transit trade contract, certificate of origin, MSDS, packing list, etc., and cooperate with the customs to complete the devanning inspection. For coated hardware cargo, the customs may require testing the coating composition, so you need to prepare the composition test report in advance. If you cannot provide it on site, you can apply for urgent testing by a third-party institution recognized by the transit port.

The testing cycle is generally 2-3 days, and you need to apply for extending the inspection period at the same time to avoid the cargo being detained due to overdue inspection. It is necessary to pay attention to the integrity of the seal. If the container is re-sealed after devanning, you need to use a seal recognized by the customs and mark the new seal number on the customs clearance form to avoid being recognized as abnormal cargo title transfer due to inconsistent seal information.

**status:** suggested
**Author:** Andy Guo
**Date:** 2026-10-18

## Related Categories
- [Import Agency Q&A](https://www.sh-zhongshen.com/en/qa/cat-import-agency/)
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