What are abandoned goods?

Abandoned goods refer to goods that remain in customs after entering the country due to failure to complete customs procedures or clear them within the specified time, and the owner takes no action for clearance. These goods, after a certain period, are recognized as abandoned goods and may be seized by customs or sold. In this article from Turkmen Sowda, we examine the concept of abandoned goods, the stages and regulations related to them, and the impact of this situation on international trade.

Reasons for Goods Abandonment

Imported goods may be abandoned for various reasons. Some of the most important reasons are:

1. Failure to Pay Customs Fees

   One of the main reasons for goods being abandoned is the inability of the owners to pay customs fees. These fees include import duties, taxes, storage costs, and other related expenses. If the owner cannot pay these fees, the goods are considered abandoned, and customs will take the necessary actions to determine their status.

2. Documentation Issues

   In some cases, the documents required for customs clearance are incomplete or incorrect, preventing customs clearance of the goods. Incomplete documentation can include issues such as discrepancies in transportation documents, failure to provide inspection certificates, or deficiencies in financial documents. If these issues are not resolved in time, the goods are declared abandoned.

3. Legal and Ownership Issues

   Sometimes, legal or ownership issues between the owner of the goods and the supplier cause delays in customs clearance. These disputes can be financial or related to ownership, and the goods may remain in customs warehouses until the dispute is resolved and are declared abandoned.

4. Sanctions and Legal Restrictions

   Sanctions or legal restrictions may lead to the prohibition of importing certain goods, leaving them in customs. In such cases, customs may have to make decisions such as returning the goods to the country of origin, destroying them, or selling them through auction.

5. Lack of Coordination with the Transport Company

   Lack of proper coordination between the importer and the transport company can result in goods remaining in customs. If the delivery schedule or submission of required documents is not properly arranged, customs clearance may be delayed, and the goods may be considered abandoned.

Steps to Declare Goods as Abandoned

1. Expiry of Clearance Deadline

   After the goods enter the country, the owner must take action to clear them within a specified period (usually 3 to 4 months). If no action is taken during this period, customs will declare the goods abandoned. This time frame may vary depending on the type of goods and the laws of each country. Goods with a short shelf life may be declared abandoned sooner.

2. Notification to the Owner of Goods

   After the clearance deadline has expired, customs will notify the owner of the goods that the goods are considered abandoned and that they must take action to clear them. This notification is usually done in writing and includes the final deadline for action. If the owner does not take action within this period, the goods proceed to the next stages.

3. Auction or Seizure of Goods

   If no action is taken to clear the goods after notification, customs can put the goods up for auction or seize them. This action is taken to recover customs costs and prevent warehouse space from being occupied. Goods put up for auction are usually sold to the highest bidder. If the goods have no commercial value or have specific conditions, they may be destroyed instead of sold.

4. Transfer of Ownership

   After the auction is held and the goods are sold, ownership of the goods is transferred to the new buyer. The buyer is required to pay the remaining costs and clear the goods from customs. This process can take several days and requires coordination with customs authorities.

Consequences of Goods Being Abandoned

1. Financial Loss to the Owner of Goods

   The abandonment of goods can result in significant financial losses for their owners. These losses include storage costs, customs fines, and the depreciation of the goods over time. Perishable goods or those with an expiration date are particularly at risk of losing their value.

2. Environmental Issues

   Some abandoned goods, especially chemical or pharmaceutical products, may pose environmental risks. Improper storage or incorrect disposal of these goods can lead to environmental pollution and harm to humans and animals. Customs must take necessary measures to properly manage these types of goods.

3. Negative Impact on International Trade

   The abandonment of goods can lead to reduced trust among traders in customs processes and increased trade risks. This issue can result in delays in the delivery of goods and increased transportation costs, affecting trade relations between countries.

4. Additional Costs for Customs

   Managing abandoned goods is costly. Storage costs, auction management, and disposal of unsuitable goods can add additional financial burdens for customs and the government. Although these costs are usually recovered through the sale of abandoned goods, this is not always possible.

Laws and Regulations Related to Abandoned Goods

Abandoned goods are subject to specific laws and regulations, including customs regulations of countries. In Iran, customs are required to notify the owner after declaring goods as abandoned, and if not cleared, to either sell or destroy them. Some goods that pose a risk to public health or the environment are managed and supervised under special regulations. These laws include requirements for proper storage, timely notification to owners, and necessary measures to prevent environmental damage.

Additionally, laws related to abandoned goods may include guidelines for determining the final status of the goods. For instance, worthless or hazardous goods must be disposed of according to environmental standards, while valuable goods can be sold at auction to recover customs costs.

Key Points to Avoid Goods Being Abandoned

1. Timely Payment of Customs Fees

   One of the key measures to avoid goods being abandoned is the timely payment of customs fees and other related costs. Owners of the goods must ensure that the necessary budget for paying import fees is available to avoid financial issues.

2. Completion of Documents and Papers

   Ensuring the completion of documents and papers required for customs clearance helps prevent goods from being abandoned. These documents include transport documents, inspection certificates, and financial papers that must be prepared and submitted on time.

3. Coordination with Transport Companies and Customs

   Importers should coordinate with transport companies and customs authorities to avoid any delays in delivery and customs clearance. This coordination can help expedite the clearance process and prevent goods from remaining in customs warehouses.

4. Awareness of Laws and Regulations

   Awareness of customs laws and regulations, as well as the deadlines for customs clearance, helps importers avoid issues related to abandoned goods. Adhering to these laws plays a crucial role in reducing the risk of legal and financial problems.

Conclusion

Abandoned goods refer to items that remain in customs due to not being cleared in a timely manner and may be seized or sold by customs. This situation can arise for various reasons, including financial, documentary, or legal issues, and has both financial and environmental consequences. In addition to financial losses for the owner, abandoned goods can lead to environmental problems and additional costs for customs.

Understanding the laws and regulations related to abandoned goods helps traders avoid these issues and improve their customs processes. Timely payment of fees, completion of documents, and coordination with customs authorities can help reduce the risk of goods being abandoned. Given the negative consequences of abandoned goods, importers should do everything possible to avoid this situation and prevent additional costs and problems.