How to import anything into Brazil
Brazil is a very large importer, especially when it comes to supplying its industrial sector with raw materials, machinery and equipments. In this article, we outlined the generic flow of paperwork and money with regard to imports in the country.
In a very straightforward explanation, the import process is divided into three complementary and related steps:
Administrative stage: comprehends all the procedures necessary to import, applied in accordance with the operation and type of goods to be imported. All acts are managed by Secex (Foreign Trade Secretariat), involving the authorization to import process, that is completed after the issuance of an import license.
Currency stage: comprehends the payment to the supplier in foreign currency and comprehends the transfer of the foreign capitals abroad, what is controlled by the Brazilian Central Bank and is processed through a bank authorized to perform exchange transactions.
Customs clearance: involves the taxes collections, the documents' check and it is completed with the withdrawal of the goods in the Customs.
Official documents issued by the importer
The following documents are necessary to run the import process in Brazil. They are issued by the importer and must be authorized by governmental organizations.
Import license (Licença de Importação) It is an electronic document that must be filled up on internet by the importer or by its customs broker, through the unified system of foreign trade (SISCOMEX).
Import declaration (Declaração de Importação) It is the background document of the imports clearance, formalized by the importer through the SISCOMEX, at the moment of the goods' clearance. The import declaration is required for all the import processes and comprehends the complete set of information regarding commercial details, exchange and taxes, needed to analyst the operation. It is in charge of the bank and the importer to bind the import declaration with the exchange contracts.
Proof of import (Comprovante de Importação) It is the document that effectively promotes the nationalization of the goods imported. It is also an electronic document, issued by the Federal Revenue, and that proves the effective nationalization of imported goods, through the payment of taxes when due.
Classification of goods
Brazil, together with Argentina, Paraguay and Uruguay adopts the Mercosul Common Nomenclature (NCM) which is based on the international method of product classification (Harmonized System). The classification of goods define the percentage of taxes (IPI, ICMS and II) will be paid, and what will be the competent organization in charge of authorizing the import. For each product classified in NCM/HS will be issued a specific import license, by a specific governmental institution.
Rate regime: The Brazilian market adopts the floating exchange regime, but the Central Bank sometimes interfere in the value of the currency to decrease the floating exchange instability.
Arrangements for payment
Payment in advance: Here, the contracting and settlement of the transaction (remittance abroad of foreign currency), take place before the goods are shipped. If the exporter do not submit the goods or ship the wrong order, the process can be canceled. If the goods were not shipped or were not nationalized yet the importer must provide, in up to 30 days, the repatriation of the payment.
Remittance without draft: The exporter will ship the goods, prepare the documents concerning the operation and send the papers to the importer. Only after receiving the documents and the goods the importer will remit the payment. Here, if the remittance is full upon delivery, the importer is responsible for binding the exchange contract to the import declaration. If it is a deferred payment the bank is responsible for doing this process.
Payment in full upon delivery: The exporter will ship the goods and send the document's to a foreign bank, which will send them to a Brazilian bank appointed by the importer. The Brazilian bank will register the charge and forward it to the importer. In this arrangement of payment, the importer is responsible for binding the exchange contract to the import declaration.
Deferred payment: This procedure runs like the payment in full upon delivery, but the goods will have an stipulated payment deadline. Here, the bank is responsible for binding the import declaration to the exchange contract.
Letter of Credit: The letter of credit is issued by a bank under the importer's orders, that guarantees the payment to the exporter if he comprises with everything that was promised to the importer. If the Letter of Credit establishes payment in full, the importer is responsible for binding the exchange contract to the import declaration. If it is a deferred payment the bank is responsible for doing this process.
Financial tranfer: The payment is done without the need of formal documents, only by filling up a proper bank form, in which the importer will declare the reasons for the transfer.