How Customs Works

A nation's customs service has many responsibilities. At its most basic level, its purpose is to regulate what comes into and goes out of a country. The foremost element of this regulation is controlling international trade. The concept of trade is as old as civilization itself. If my tribe has a huge supply of bananas, and your tribe has a huge supply of fur, we will trade goods so that both our tribes can eat and both can keep warm. In the modern world, international trade is based on money, but it works in pretty much the same way. My country may produce more televisions than the population needs, but not enough cars. In order to have everything the population needs, businesses in my country will export TVs (sell them to people in other countries) and import cars (buy them from other countries).

Any nation wants its own businesses to do well, so most of the time they prefer their people buy domestic goods over competing foreign goods. But in many cases, goods are available cheaper in another country than in your country, and people naturally want to buy them at the lower price. To tilt the balance in favor of domestic businesses, governments impose tariffs, also called duty, on foreign goods coming into the country.

In addition to encouraging domestic trade, duty also gives the nation a "piece of the action" when somebody buys something produced overseas. Customs agencies are often major sources of revenue for the government. The U.S. Customs Service, for example, brings in more money than any other government office except the Internal Revenue Service. To control specific sorts of trade, a government may impose a higher tariff on certain types of goods (alcohol, for example). Certain countries may join together to work out mutually beneficial trade agreements, enabling businesses in those nations to trade more freely with each other than they can with businesses in other nations. This gives an advantage to nations that a country has a good relationship with.

Customs agencies also monitor what is being exported from a country. For example, most governments strictly regulate what weapons can be exported to other nations. This is simply a common-sense safety measure: It's not a good idea to arm enemy nations, so the government has to know who is buying any domestically-produced weaponry. As we'll see later on, customs agencies also pay careful attention to how much money citizens are transporting out of the country.

Duty charges have a huge effect on big businesses, which may import millions of dollars worth of goods every year. To regulate trade on this level, a country's customs agency must keep track of all shipments that come into the nation's ports or cross its borders. They can't check every bit of foreign cargo, of course, so agents pick certain boxes to inspect and certain shipments to scrutinize. In an effort to speed up the process, the U.S. Customs Service is implementing new, computerized systems for processing shipments and charging importers.

While large businesses are the main importers in a country, trade restrictions also apply to the individual traveler.

When you bring home souvenirs from another country, you are actually importing goods. In the United States and many other countries, the customs agency grants each traveller a nominal duty exemption to allow them to bring back a reasonable amount of goods without having to pay tariffs. To learn more about these allowances, check out How the U.S. Customs Service Works.

In most countries, it isn't feasible for the customs agency to check all of the goods that every single traveller is importing, so governments have to depend largely on people's honesty. When you enter a country, you are asked to truthfully report what goods you are importing and make a good faith estimate of their value. They don't put their entire trust in people's good character, of course; customs performs a thorough search of some percentage of all travelers.

Some customs agencies decide which travellers to search based on random chance. You are asked to press a button on a machine that activates a random number generator. Depending on the number that comes up, either a green light comes on and you can pass through or a red light comes on and the agent searches your bags. Other customs agencies decide who to search based solely on intuition. After many years on the job, a customs agent develops a keen eye for people who are up to no good. Unlike the police, customs agents are fully authorized to search your luggage, clothes and even your body without any warrant or reason for suspicion. Customs agents often work side-by-side with immigration officials, and in some ports of entry, one inspector may represent both agencies. But at its core, a customs agency is concerned with the things that are coming in and out of a country, rather than the travelers themselves.

In addition to monitoring legal imports, a nation's customs agency also works to keep out illegal or contraband items. In the next section, we'll see why citizens are not allowed to import certain goods and find out what customs agents do to enforce these laws.

In the last section, we saw that a country's customs agency regulates and monitors the nation's imports. Importing is a funny thing, because for some goods, trade is governed only by the laws of supply and demand, while for other goods it is tightly regulated by the government. In most cases, if people really want something from overseas (because they can't get the same thing domestically), somebody will import a supply to meet that demand. If the demand is high, the importer can mark up the price to cover whatever duty applies, the people get what they want, the government gets its share and everybody's happy.

But in some instances, there may be a high demand for something that the government decides should not be brought into the country. The most prevalent example of this is illegal drugs. In the United States, there is a high demand for cocaine, but there is a very small domestic supply. If somebody can import the cocaine from South America, where the supply is more plentiful, that person can make a substantial profit. But cocaine is illegal in the United States because the government has deemed it a harmful substance, and the consequences of trying to import it are severe. Regardless, the demand is high enough that people still try to smuggle it in.

In the United States and many other countries, stopping drug smugglers is among the government's top priorities. To this end, customs agencies may employ a fleet of boats, planes and border-patrol cars to keep people from getting drugs into the country without passing through customs. Most countries maintain a number of different border-patrol agencies that work together and separately to regulate who and what comes in and out of the country. In the United States, for example, the U.S. Customs Service, the Drug Enforcement Administration, the Coast Guard and the Immigration and Naturalization Service would all have an interest in a group of foreign smugglers sneaking in a boat carrying a shipment of drugs. In apprehending and prosecuting the smugglers, the agencies would all have to work together.

The United States Customs Service uses advanced, radar-equipped airplanes to patrol the coast from above. The technicians on the plane locate likely smugglers and transmit their location, as well as the location of any customs vehicles, to a central office. From this central office, customs agents work with branch customs offices to coordinate the apprehension of the smugglers.

When they get the signal, customs officers hop in their vehicles and head out to track down the smugglers. When the smugglers are sneaking into the country in an airplane, the customs office deploys a small jet plane and a Blackhawk helicopter. The plane crew locates the smugglers but flies at a distance. The Blackhawk crew then moves into position just behind and below the smugglers' plane. Most of the time, the smugglers can't see a helicopter in this position, so they don't notice that they are being pursued until they touch down and a squad of armed officers fans out around them.

If the smugglers are sneaking into the country by boat, the pursuit can be even more harrowing. Smugglers typically approach the coast at night, zipping along in speed boats at 60 or 70 miles per hour (about 100 kph). The U.S. Customs Service has a fleet of its own high-speed boats, and when they spot a smuggler crew they will keep pace until the "bad guys," as they are known to the agents, decide to give up. Once the smugglers have come to a stop, the customs agents board the boat with their guns drawn. When the smugglers surrender, the agents take everyone onboard into custody and collect any contraband as evidence.

Not all smugglers try to circumvent customs entirely. Many will play the odds, hoping customs agents don't search their bags or don't find the illegal goods if they do. Experienced agents have seen it all: drugs hidden in shampoo bottles, speakers, coolers, taped under a smuggler's clothes or even secured inside the smuggler's body. Customs agencies can't stop this activity entirely, but they can catch enough of the smugglers to deter others. To stop smugglers, agents rely on a combination of their own experience and sophisticated equipment.

At a few airports, customs uses room-sized X-ray machines calibrated to look through a person's clothes for any mysterious bulges. At the main border crossing between the United States and Mexico, customs agents use an X-ray machine large enough to scan entire cars and trucks. Some agents are also equipped with handheld electrovacuum devices that analyze the particles in the air around a package or piece of luggage. Using these sensitive sniffers, the agents can quickly determine if there are explosives or drugs inside.

Customs agencies also use drug-sniffing and bomb-sniffing dogs to stop smugglers. These animals go through an intense training process that teaches them to recognize and locate particular odors in exchange for some play time. In airports, customs agents let the dogs sniff out arriving passengers' luggage and sometimes the passengers themselves.

Additionally, agents may take the dogs onboard the plane after the passengers have departed. If a passenger is carrying drugs on his or her body, the dogs might pick up the scent lingering on the seat. The agents then find out who was sitting there and pull the passenger aside for a full body search.

Drugs are not the only goods that people smuggle across borders; in different countries throughout the world, there are a wide variety of things that are considered contraband. Sometimes people try to import items without even realizing it's against the law. In the next section, we'll look at some of the other types of goods that get stopped at customs.

In the last section, we looked at some of the ways customs agencies fight the flow of illegal materials across borders. In addition to drugs, customs agencies may watch for weaponry, child pornography, counterfeit merchandise and stolen goods. They also watch for people carrying illegally gained money across borders. Criminals will try to smuggle money from country to country in an effort to launder it (deposit or invest it in legitimate forms, concealing its true source). In some countries, customs agents are more concerned with people exporting money than importing money. Criminals will take ill-gotten cash to a country with less-vigilant law enforcement, where they can use it freely.

These sorts of illegal materials make up only one category of contraband goods. Customs agents also stop the importation of legal goods that are a threat to the nation's security. In most countries, the importation of fruits, meats, animals and plants is heavily regulated due to the fear of disease or ecological imbalance. While it may seem strange that a piece of fruit is considered a threat to national security, the risk of biological contamination is very real. In the late 1980s, one traveler with one piece of contaminated fruit caused an infestation of Mediterranean fruit flies that destroyed millions of dollars worth of crops in California. Customs agencies test food imports, and if the samples do not meet the governments standards, the goods are destroyed or turned away from the port. When animals are brought into the country, they may be put in quarantine for long-term observation.

Some completely harmless items are deemed contraband simply because of the country they come from. If country A is considered to be a national enemy of country B, or has a record of violating international law, country B (and other countries) might institute an embargo against that country (a ban on the importation of country A's goods). This cuts off potential business for country A, and this may persuade its leaders to change their policies. In the United States, the best known example of this sort of sanction is the embargo against Cuban products. There is a high demand for Cuban cigars in the United States, but they are strictly regulated because of the strained relationship between the United States and Cuba. As with drugs, smugglers are eager to sneak in a supply to meet this demand, and are constantly trying to get around customs.

In many countries, the customs agency closely monitors the importing and exporting of cultural artifacts. While a traveler may have purchased the item in good faith, it might have been stolen at an earlier point. Customs agencies have helped to restore many priceless artifacts to their rightful owners.

A country's government might also ban importation of items based on ethics and morality. For example, in many countries, you cannot import ivory or other products that come from endangered animals. In 2000, the United States enacted the Dog and Cat Protection Act, banning the importation of any products made from dog and cat fur that was acquired inhumanely. The U.S. Customs Service confiscates all such goods so that U.S. citizens do not inadvertently support this practice.

Without customs agencies, nations would have no control over what comes in and goes out of their country. In order to protect its citizens and businesses, a government has to be vigilant in protecting its borders, not only against armed attack, but also against unwanted imports. As any customs agent will tell you, this is crucial to maintaining order in modern society.

For more information on customs and related topics, check out the links on the next page.