Study Guide

3. Air Cargo

Learning objectives

✓	Describe how air cargo moves from arrival at an international airport through to release, including the role of master and house air waybills.
✓	Explain how customs uses the information on inwards cargo reports and import declarations to risk-assess and clear air cargo.
✓	Compare the customs handling of express cargo and postal traffic with that of general air cargo, including the role of the WCO Immediate Release Guidelines.

International air cargo is carried by both passenger aircraft and all-cargo freighter aircraft. International flights arrive at and depart from designated international airports.

Aircraft arriving at international airports want to turn around quickly, so air cargo and baggage need to be offloaded promptly on arrival. Air cargo is first moved to cargo terminal operators, who usually have direct access to the airport tarmac. There can be a delay in moving air cargo to the terminals because loading cargo for export is often a priority.

Air cargo is carried in Unit Load Devices (ULDs), also known as airfreight containers, or is loaded onto air freight pallets. There are many aircraft types and many more aircraft cargo configurations. Each aircraft and configuration may require customized containers.

A manifest of all air cargo on an aircraft must be provided to Customs by the principal carrier, usually the airline carrying the cargo. This manifest is a consolidation of the master air waybills for each flight. An air waybill is the document made out by or on behalf of the shipper. It is the contract between the shipper and the carrier for carriage of the goods on that flight.

Master air waybill compared with house air waybill

Master air waybill	House air waybill
•  Issued by or on behalf of the principal carrier (usually the airline) •  One per flight, covering all cargo carried •  Identifies the airline as the carrier •  Forms the basis of the cargo manifest provided to Customs	•  Issued by the freight forwarder to its customers •  One per consignment within a freight-forwarder consolidation •  Identifies the actual consignee and consignor •  Reported separately to Customs alongside the master

Customs will usually risk-assess for prohibited import purposes from the lowest level air waybills. Until this risk assessment has been completed, air cargo will not be permitted to move outside Customs licensed premises. Cargo may be allowed to move from the cargo terminal operator to other licensed depots in the airport area.

Customs administrations using electronic systems will usually request reporting of air cargo consignments two to three hours before the aircraft arrives. If airlines meet this requirement, Customs will usually carry out the risk assessment before the cargo is landed. Customs then provides clear status, subject to the lodgment of an import declaration, for goods that do not require examination.

Where Customs decides to examine a consignment, the examination will usually be done in the cargo terminal or at the licensed depot. Air cargo consignments are smaller, so the examination is usually a full examination, sometimes supported by a mobile X-ray van. These examinations usually take a maximum of an hour. Where container X-ray machines are available, larger air cargo consignments may be transported to those facilities for examination.

When Customs is satisfied that the consignment does not contain any contraband, the container is repacked and made available for delivery once an import declaration has been completed. If contraband is found, Customs and other authorities will take appropriate action.

Each air cargo consignment is reported to Customs twice: first at air waybill level as part of the inwards cargo report, then again by the owner (directly or through their customs broker) on the import declaration.

The customs clearance of the import declaration allows the goods to move from the air cargo terminal operator into domestic distribution or into a customs warehouse. With air cargo, there is usually a separate process to move the cargo on the basis of the air waybill from the terminal operators to licensed depots, often owned by freight forwarders. This can be either a full ULD or several separate consignments.

Customs also undertakes a risk assessment of the cargo based on the information provided on the import declaration. This may lead to further examination of the documents relating to the consignment to determine the correct duties and taxes to be paid.

A full examination of the goods may be undertaken to:

Reasons for full examination

01 Verify compliance Check that the goods match the invoice details and meet customs legislation.

02 Detect contraband Identify drugs, firearms, explosives, or other prohibited and restricted items.

03 Meet agency rules Satisfy quarantine, import permit, and other government agency requirements.

Once Customs is satisfied that a consignment meets all requirements, it will provide clearance for the goods, subject to the payment of duty and taxes if applicable.