The Brazil Customs Challenge:
How to Get Your Goods in and Get Paid
Prepared by : Denise Carrion & Rubio Guimaraes
1
Corporate Presentation
April 2011
John Pattullo
CEVA Logistics
CEO
CEVA Logistics
Overview
GLOBAL
• Revenue – €6.8 billion
• Over 49,000 employees
• 1,200 locations in over 170 countries
• 10 million square meter combined storage space
BRAZIL
Vision : “ CEVA will be the most
admired company in the supply chain
industry exemplifying Unity, Growth
and Excellence”.
• Employees : +6,500
• Warehouses : +585,000 sqm +
• Branches : 60
Mission : Making Business Flow
2
Corporate Presentation
4th largest global supply chain company
2
4 October 20152
Global
End-to-end Capabilities
Manufacturing
support
Inbound
Transportation
• Receipt and
management of
raw materials and
products at source
• Control
• Re-packaging
• Value-added
services
• A range of multimodal capabilities
• Time definite
services
• Customs
brokerage
• Web enabled
tracking solutions
Warehousing &
Distribution
Centers
• Dedicated and
shared
warehousing
• Distribution
network centers
• Value-added
services
Outbound
Transportation
Aftermarket
Services
• Dedicated and/or
shared
transportation
• CEVA Ground
distribution
services
• Transportation
network
management
• Spare parts
warehousing
• Spare parts
distribution
• Returns
• Repairs
• Reverse logistics
• Call center
services
Final Mile
Solution
• Home delivery for
finished goods
• One and two man
home delivery
• After sales set up
• Installation
• Reverse logistics
CEVA Logistics
Customers in Brazil
Brazil
AM
MA
PA
PE
GO
MG
ES
SP
RJ
PR
RS
011
Apresentação Institucional
4
The Brazil Customs Challenge:
How to Get Your Goods in and Get Paid
Prepared by : Denise Carrion & Rubio Guimaraes
AGENDA
The Brazil Customs Challenge
Import
License
Process
International
Transportation
Customs
Clearance
Transactional
Process
International
Payments
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
In order to avoid penalties and delays at customs clearance for our customers,
it is mandatory :
• DECLARE CORRECTLY CONSIGNEE/SHIPPER'S NAME on all shipping documents.
• MAKE sure that the consignee's CNPJ (Company's ID number in Brazil) is mentioned on all shipment
documents (commercial invoice + packing list).
• ENSURE that there is a perfect match among the weight shown on the invoice/packing list, and the
actual weight of the cargo.
• NOTE that a HAWB/HBL can be amended only before arrival of the cargo in Brazil, and those
documents are only issued at origin based on all details of Shipper Commercial Invoice + Packing List.
• PREPARATION of Commercial Invoice and Packing List as per Brazilian Legislation Requirements.
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
According to Brazilian laws and in order to avoid fines and delays during the Customs Clearance process, commercial
documents, such as commercial invoice and packing list must be prepared as per requirements below :
Commercial
Invoice
- Issued under Exporter’s letterhead, hand-signed in BLUE ink, by an authorized person; identifying title and name
– Commercial Invoice must be expressly written in the title, invoice number, date;
– Must contain : Exporter’s and Importer's complete name and address and Part number;
– Complete description of goods in English language. The description must be done with complete words
-Quantity of goods with respective unit and total price in accordance with the conditions negotiated,
mentioning expressly, if agreed, the amount of reduction or discount offered to the Importer;
– Marking, numbering, and, if available, package reference number;
– Quantity and kind of package;
– Package gross weight, thus considered the weight of the goods with all its recipients;
– Net weight, thus considered the material free of any wrapper;
– Country of origin, thus considered that where the goods was manufactured or where the biggest transformation
was occurred;
-Country of acquisition, thus considered that where the goods were acquired to be exported to Brazil,
independently of the country of origin of the goods or its parts;
– Country of shipment, thus considered that from where the goods was delivered at the moment of its acquisition;
– Payment terms and negotiated currency;
– Sales condition terms (Incoterms);
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
- The phrase “Packing List” has to be expressly written in the document title;
-The packing list must be hand-signed in BLUE ink, by the authorized person; identifying his title and name,
Packing
List
MUST CONTAIN :
- Packing list number; issuing date;
- Complete name and address of the Exporter (as it is in the commercial invoice);
- Complete name and address of the Importer (as it is in the commercial invoice);
- Type/ package model;
- Package content (part numbers and quantities);
- Package quantities;
- Package Dimensions or cubic meters;
- Total gross weight;
- Total gross weight per package;
- Total net weight;
- Total net weight per package.
- All cargoes will be weighted by Brazilian Customs and if they state any discrepancy, it will delay the clearance
process and Customs will charge a penalty, therefore the correct gross weight must be mentioned in the document.
- It is necessary to have a Packing List for each Invoice issued.
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
• Some products requires an Import License prior to be shipped to Brazil. Those licenses are based on import
control defined by the government and it can change from time to time accordingly to market situation,
internal production and other factors.
• Prior to start exporting to Brazil, it is crucial to check if the product to be exported requires previous Import
License. Based on the HC (Harmonized Code) is possible to check at Brazilian Customs Systems (SISCOMEX)
the IL requirements.
• There are many government entitites that regulate the import flow to Brazil, such as Ministry of
Agriculture, Ministry of Health, Ministry of Army, Suframa (that controls Free Trade Zones) and many
others. Those entities define Import License Procedures and requirements.
• The Importer Company must attend all those requirements directly or using a broker company, procedures
are executed through SISCOMEX or for some specifics Ministries, physical documentation must be
presented.
• The time to obtain an Import License varies from 5 working days to 30 days. Per law, the international
transportation documents (air or ocean waybill) cannot be issued prior to the date of Import License
issuance.
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
• All goods that enters the country, imported permanently or not, is subject to customs
clearance process, which is processed based on the Import Declaration (DI), prepared in
SISCOMEX (Brazilian Customs Integrated System of Foreign Trade).
• Import Declaration is controlled by SISCOMEX based on the import requests for each product.
An automatic sequencial reference is provided for each declaration. This reference identify the
entire import customs clearance process and will be used to check :
• The status of Import Company with Customs for any irregularity;
•
The compliance with exchange rules as per Central Bank;
• The arrival of the cargo (volumes, weight, documentation, etc);
• The Duties & Taxes Payments;
• And all kind of imported goods information
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
IMPORT DECLARATION
Importer
Information
Cargo
Information
Goods
Value
Duties & Taxes
Key Import Elements for a successful Clearance in Brazil
Customs Clearance Transactional Process
IMPORT DECLARATION
Exporter
Information
Harmonized
Code
Goods
Description
Import Duty
Duties & Taxes
Details
VAT
PIS
Cofins
Key Import Elements for a successful Clearance in Brazil
Summary of Import Taxes
IMPORT DUTY: it will be charged from 0% till 35% over CIF value depending on kind of goods;
VAT: will be charged from 0% till 33% over CIF value + IMPORT DUTY;
PIS: (Social Integration Program Tax/Worker’s Tax): will be charged from 0% till 2,30% over CIF
value + IMPORT DUTY + VAT + % ICMS;
COFINS: (Social Security Financing Tax/Social Tax): It will be charged from 0% till 10,80% over
CIF value + IMPORT DUTY + VAT + PIS + % ICMS;
LOCAL FEE: It will be charged between 7.5% till 25% over CIF value + IMPORT DUTY + VAT + PIS
+ COFINS; depending on the state in Brazil that cargo will be released;
Basic Import Regulations Requirements & Flow
Customs Channels & Conference Process
• The Import Declaration will be accompanied by the following documents :
• Original bill of lading or equivalent document
• Original commercial invoice
• Other documents required by specific legislation or international agreements
• Once registered by SISCOMEX the system itself indicates the type of conference that can be :
• Drives through an automatic Clearance Process
• No Documents and Physical inspection required
Average
1-2 days
Green Channel
• Requires a document review
• No physical inspection is required unless some problems are found on the documents
Average
3-4 days
• Requires a document review
• Requires physical inspection
• Red Channel is applied when customs systems identify a risk of fraud or issues
on products description or quantities, any inconstancy on Import Declaration, etc
Average
7-10 days
• Requires a document review
• Requires physical inspection
• Gray Channel is applied when customs systems identify a risk of fraud or
issues on goods amounts pricing (under or over)
Average
10-15 days
Yellow Channel
Red Channel
Gray Channel
Basic Import Regulations Requirements & Flow
Import Customs Flow
START
Import License
Required
CEVA receives copy of commercial invoice
and/or instructions from the customer
CEVA prepares the Import License
in the Customs system (Siscomex)
with detaild of goods, HS number
and copy of proforma invoice
CEVA types the data into Customs system
(Siscomex)
CEVA registers Import License in
the system (Siscomex)
Registration,
Part Number/
Instruction
ok?
CEVA checks the Import License
regularly waiting for Customs
approval
No
CEVA requests
information to customer
Yes
IL
approved?
Yes
Registration
OK
CEVA stands for the pre
alert to finish data
typing
No
CEVA
Authorizes
customer to
proceed with
shipment
Pre alert
receipt
Check requirements and proceed
Checking
OK?
Yes
No
CEVA requests for missing
documents and eventual
corrections
Basic Import Regulations Requirements & Flow
Import Customs Flow
Import Declaration typing
Import Declaration Checking
Checking
OK?
No
Provides proper adjustments
Yes
CEVA sends advanced cash for
expenses
CEVA awaits authorization from
customer for debit of duties and taxes
CEVA access Siscomex and check diagnosis
Diagnosis
OK?
No
Yes
CEVA proceeds with Import Declaration
registration in Siscomex (register transfer):
- Prints ID report
- Pays ICMS – Enter ICMS information in Siscomex
- Pays AFRMM (seafreight only)
Flight or Vessel arrival
Siscomex suppies errors and
correction or follow-up
information (alerts: green, yellow,
red)
Basic Import Regulations Requirements & Flow
Import Customs Flow
Check Siscomex Sorting
Yellow
Documents checking by Customs
agent. Status informed in
Siscomex
Red/Grey
Light ?
Physical checking by Customs
Status informed in Siscomex
Green
Status
?
Cleared
Cleared by Customs - CEVA gets orignal
shipping documents
Import Confirmation ticket issued by Siscomex
Statu
s?
Grey Light
Pending
CEVA meets the
requirements
Cleared
Import Declaration built up according to
Customs Clearance facility
Issuing Nota Fiscal de Entrada
Forward Nota Fiscal to Customs facility where
the shipment is
CEVA performs payment of storage charges to
Infraero
Documents tendered to the trucking company
File closing
Paperworks build up for invoicing
END
Registers
discrepancy in
Siscomex and
performs
warranty
deposit
Follows-up
the process
along with
Customs
agent
Pending
CEVA meets
the
requirements
Key Import Elements for a successful Clearance in Brazil
Penalties (some of them …)
P.S.: Government can change these amounts without previous notice !
Advices to Companies Exporting to Brazil
• Nothing is forbidden to be imported to Brazil !
• It is complex and bureaucratic, however can be done properly using correct partners and correct
process !
• Prior to start exporting to Brazil it is higlhy recommended to consult a Customs Expert that will
guide your company through the rules and requirements of our Country.
Brazilian Customs Official Web-site
English version available !
http://www.receita.fazenda.gov.br
CEVA Logistics
Contacts
Denise Carrion
Brazil Managing Director for Freight Management
Tel (55) (11) 2199-6723
Email : [email protected]
Rubio Guimarães
Brazil Customs Clearance Director
Tel (55) (11) 2199-6724
Email : [email protected]
...Making business flow
22
LATAM Finance Seminar 2011
June 2011
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