Upgrade anyone?

Electronics are often the source of difficulty in international trade but aside from the obvious issues one that is often ‘forgotten’ is the problem that upgrades can bring.   

Having gone to enormous trouble to obtain a tariff classification and export licence for the original item, product development and customer feedback will often lead to the development of a new, improved version.

 

However, what appear to be improvements or extensions to existing functionality can in Customs terms change the classification and the export licence class of the product.  This can mean a change to the tariff code and an invalidation of the export licence.

The result?

An inability to export any of the product until a new export licence is obtained 
An increase in import duty and VAT
Delayed product launches
Unhappy customers

The solution?  Teamwork!


www.morley-consulting.co.uk

Freeports?

Today I was asked a very good question – is a Freeport free?  The answer is yes and no.

Freeports are areas where special customs rules apply.

Generally goods may be held in a Freeport without the payment of import duty or tax such as VAT.  This is the only respect in which they are free.

The companies within the Freeport will charge for storage, processing and documentation.  So no they are not ‘free’.

Equally they are not free of rules or regulations and these rules and regulations can be very different in different Freeports and amongst other things they govern how goods can be removed from the Freeport, what can happen to them while they are there, and what duties and taxes will be levied if they are eventually imported into the host country.

Free ports in Switzerland are said to house some of the biggest art collections in the world.   Stored without import duty or tax until a collector, having viewed the item in storage, chooses to buy and import it. 

www.morley-consulting.co.uk