Question: Process and procedures for importing goods into Germany??

Answer: 

As a member of the EU, Germany basically applies the same processes and procedures for importing goods as the EU.

The process of importing goods into the EU is detailed at the European Commission's Access2Markets Portal (https://trade.ec.europa.eu/access-to-markets/en), with the specific link address: https://trade.ec.europa.eu/access-to-markets/en/content/guide-import-goods.

In addition, the website of the German Customs (https://www.zoll.de/EN) at: https://www.zoll.de/EN/Businesses/Movement-of-goods/Import/import_node. html also regulates the import process.

(It should be noted that the links mentioned in this section are for reference only and may be changed. In any case, businesses can directly access the Access2Markets Portal and the website of the German Customs to find information).

Below is a summary of the steps for importing goods from non-EU countries into Germany:

Step 1: Preparation for import

 Registering EORI Number - Economic Operators Registration and Identification number

In order to import and export goods into and out of the EU, individuals/enterprises of the EU are required to use the EORI number as an identification number in all customs procedures when exchanging information with the EU’s Customs administrations. Each economic operator only has an EORI number, valid throughout the EU territory. Thus, in order to import goods from Vietnam into Germany, the importer must register an EORI number and must declare the EORI number on all customs declarations.

The EORI number is assigned upon request and free of charge by the General Directorate of Customs’ Master Data Management office in Dresden (GZD - DO Dresden - Stammdatenmanagement). However, from October 1, 2019, importers can register or change recorded data via the Portal for citizens and corporate customers at www.zoll- portal.de.

For detailed information on the procedure for requesting an EORI number, see the link: https://www.zoll.de/EN/Businesses/Movement-of-goods/Import/Duties-and-taxes/EORI-number/eori -number_node.html.

Determining the import category of goods

Not all goods are allowed to be imported into Germany, and not all goods imported into Germany have the same import mechanism. In fact, for a number of reasons, Germany may impose import bans/restriction regulations on certain countries, individuals/organizations and goods.

Therefore, before importing goods into the German market, importers need to determine the import category of their goods to determine the corresponding procedures. Some goods are banned/restricted from import, or subject to special control, so Vietnamese exporters and German importers need to pay special attention.

What goods are imported into Germany subject to import restrictions or special controls? Goods banned from import Similar to other countries, the EU/Germany also bans the import of some goods that are likely to affect national security, human life and health, environment, culture... List of goods banned from import to Germany can be found at: https://crossborder.fedex.com/us/assets/prohibited-restricted/germany/index.shtml. Goods on this list will not be allowed to be imported into the German market. Prohibited/restricted imports from certain countries or specific organizations/individuals For a number of reasons such as foreign or security policies, Germany may implement measures that prohibit or restrict the import of goods from certain countries (commonly known as embargoes), or from certain organizations/specific individuals (often called sanctions) The list of embargoed countries is detailed at: https://www.zoll.de/SharedDocs/Boxen/EN/Hintergrund/0016_list_of_embargoed_countries.html?nn=204780&faqCalledDoc=204780. Vietnam is not on this list. The list of organizations/individuals subject to sanctions is detailed at: https://www.zoll.de/SharedDocs/Boxen/EN/Hintergrund/0017_list_of_individuals_and_organisations.html?nn=205762&faqCalledDoc=205762 . Currently, there are no Vietnamese organizations/individuals on this list. Goods subject to special control (specialized inspection, import license, etc.) Goods imported into Germany, depending on different types, can be controlled in different forms, for example: - Fruits and vegetables: Need to comply with the limit level of pesticide residues, microorganisms and impurities, have the Phytosanitary certificate, comply with labeling requirements... - Seafood: Need to comply with the limit level of antibiotic residues, pesticide residues, and contaminant residues for seafood, meet labeling requirements, have Sanitary Certificate, must be caught legally... - Textiles and Garments: need to meet the General Product Safety Directive (GPSD), comply with regulations on chemicals restricted from use in the textiles, comply with labeling requirements… and some specific products (children's clothing, protective clothing...) need to comply with additional regulations. Vietnamese exporters need to carefully learn about the specific import regulations and requirements on their goods to meet and obtain relevant certificates when exporting to Germany, through which the importer can complete the relevant import procedures.

 

Step 2: Classification of goods

 Determining the classification of goods (HS code) is a very important step in determining the import tariff on that good. It should be noted that, World Customs Organization (WCO) developed the 6-digit HS code and it is harmonised across most countries in the world.  Countries can further classify goods by adding longer codes to the first 6 digits. Therefore, national HS codes may vary from country to country. Most countries add 2 or 4 numbers (forming an 8-digit, 10-digit HS code).

Vietnam currently uses 8-digit HS code under the ASEAN Harmonized Tariff Nomenclature (AHTN). Meanwhile, Germany applies the EU's combined nomenclature (CN) (8-digit) for the purpose of imposing import tariffs, and the 11-digit code for the purpose of imposing VAT and some other measures.

Therefore, when exporting goods to Germany, Vietnamese exporters need to determine the HS code of the goods according to the German HS system (11 digits) which is different from the Vietnamese HS code (08 digits). Thus, it should be based on the description of the goods to determine the accurate classification. If businesses are unsure of their classification, they can contact German Customs for assistance in pre-determining the HS code of their goods.

Structure of Germany’s HS System Germany uses the HS System detailed up to 11 digits as follows: - The first 6 digits: Based on WCO's Harmonized System (HS). The WCO's HS system is used uniformly by 183 countries and territories that are members of this Organization, including Vietnam and the EU. - The 7th and 8th digits: Based on the EU's HS System, called the Combined Nomenclature (CN), published in the EU's Official Journal in October every year. This is an 8-digit HS system, which is applied uniformly throughout the EU for members to use as a basis for building their national HS System (more detailed up to 10-11 numbers). The EU also uses this CN System in international trade negotiations on tariffs. - The 9th and 10th digits: These two numbers are prescribed under the Integrated Tariff of the European Communities (TARIC) for the purpose of coding goods for the EU's import management measures such as anti-dumping measures, duty suspensions, tariff quotas, etc. - The 11th digit: The 11th number is used for classification of goods for national purposes, such as used for determining VAT or German import bans or restrictions. Example about the structure of Germany’s HS System for Children's books with HS code 4901 9900 00 9: Code number Formal structure 49 Chapter - harmonised system 4901 Heading - harmonised system 4901 99 Subheading - harmonised system 4901 9900 Subheading - combined nomenclature 4901 9900 00 Subheading - TARIC/Community use 4901 9900 00 9 Code number - Electronic customs tariff/national use Businesses can learn more about the German HS System at the website of German Customs (https://www.zoll.de/EN) by following the link: https://www.zoll.de/EN/ Businesses/Movement-of-goods/Import/Duties-and-taxes/Normal-customs-clearance/Customs-Tariff/customs-tariff_node.html

 

It is noted that, although the Germany’s HS System details up to 11 numbers, the determination of tariffs for goods imported into Germany only needs to be based on the first 8 numbers. The reason is that the EU applies a uniform tariff system across the EU and this system is detailed to only 8 numbers (according to CN). Tariff commitments of the EU in the EVFTA are also based on the 8-digit HS code. The detailing of HS to 10 digits according to TARIC or 11 digits is not for tariff classification but for other purposes. Therefore, on import declaration, German importers still have to declare up to 11 digits, but determine the import tariff according to the first 8 numbers.

In addition, for certificates of origin (in case goods are subject to EVFTA tariff preferences), only the first 06 numbers of the HS code of the goods need to be provided because the ROO in the EVFTA are only detailed up to 06 numbers. Currently, because Vietnam has not yet applied the origin self-certification mechanism in the EVFTA, the Vietnamese exporter needs to apply for a Certificate of Origin (EUR.1 form) at a competent authorities of Vietnam for goods exported to Germany and send it to the German importer to enjoy the EVFTA tariff preference.

 Step 3: Determining tariffs, duties and fees

Import tariffs

After determining the HS code of a product according to the Combination Nomenclature – CN of the EU (8 digits), the importer can identify the import tariff rate applicable to that product.

For Vietnamese goods imported into Germany, there are 03 tariff options, each corresponding to a specific tariff rate and condition, specifically:

• MFN tariff: This is the tariff rate that Germany applies to goods from WTO member countries. This tariff rate is decided by the EU in compliance with its commitments in the WTO. Vietnam is a WTO member, so its goods can be applied MFN tariff when importing into Germany without having to meet any conditions (such as Certificate of Origin);

• GSP tariff: This is the preferential tariff rate that the EU (including Germany) unilaterally grants to some developing and less developed countries (including Vietnam). Not all Vietnamese goods are eligible for the EU's GSP preferential tariff. At the same time, goods that want to enjoy GSP tariff must meet the GSP ROO prescribed by the EU. However, it should be noted that the GSP tariff mechanism will only be applied within 2 years from the effective date of the EVFTA, that is, from August 1, 2022 onwards, Vietnamese goods will not be subject to the GSP tariff of the EU;

• EVFTA preferential tariff: This is the preferential tariff rate of EU member countries for goods originating from Vietnam (since the EVFTA took effect from August 1, 2020). The preferential tariff rate is determined by the EU, but in no case should be higher than the level committed in the EVFTA. To enjoy the preferential tariff rate under the EVFTA Agreement, Vietnamese goods must meet the EVFTA’s rules of origin and origin procedures.

Businesses can look up the tariffs applicable to their goods on the website of the European Commission's Access2Markets Portal at: https://trade.ec.europa.eu/access-to- markets/en/home

Other taxes and duties

Goods imported into Germany are also subject to other taxes such as:

• Excise tax: Certain types of goods are subject to excise tax when imported into the German market, for example cigarettes, alcoholic beverages (spirits, beer, sparkling wine), mineral oil, energy products... This is the tax that applies only to goods imported into Germany, not a general EU tax;

• Value Added Tax (VAT): Goods imported into Germany are subject to VAT, standard VAT is 19%, some goods are subject to a reduced VAT of 7%, for example agricultural products, food, pharmaceuticals, etc. This is the tax that applies exclusively to goods imported into Germany, not a general EU tax;

• Anti-dumping, anti-subsidy and safeguard duties: Some imported goods are investigated by the EU and imposed anti-dumping, anti-subsidy or safeguard duties. This is an unified tax of the EU, goods that are subject to such measures whether imported into Germany or any EU market will be applied these taxes.

 

Step 4: Transportation, Customs declaration and clearance for the shipment

All commercial goods transported from non-EU countries, including Vietnam, to Germany will have to make a declaration to the German Customs - the competent authority on release of goods imported into the EU at the first border gate in the territory of Germany.

Customs procedures for importing into Germany include the following steps:

• Declaring the Entry Summary Declaration (ENS): The ENS must be lodged at the first customs office of entry to the EU. The deadline for lodging ENS based on the mode of transport, for example at least 01 hour before arrival for transport by road, at least 24 hours before loading commences in the foreign port for transport by maritime containers , at least 4 hours before the goods arrive at the first airport in the customs territory of the EU for long haul flight of 4 hours or more, etc.;

• Declaring Import Declaration: After the goods arrive, the importer must declare the Import Declaration, also known as the Single Administrative Document (SAD) – which is used uniformly by all member states of the EU. The SAD can be presented by: (i) Using an approved computerised system linked to Customs authorities; or (ii) Lodging it with the designated Customs Office premises. When carrying out customs procedures, the importers must use their EORI number;

• Checking import documents: German Customs will check whether the required import documents are sufficient and valid (see details below);

• Physical inspection of means of transport and goods, if necessary;

• Collecting import tariffs, taxes and other fees.

Mandatory import documents

For normal goods, documents that an importer must present to the German customs office include:

• Commercial invoice;

• Packing List;

• Bill of Lading (sea waybill – B/L, air waybill – AWB…);

• Certificate of Origin (C/O): to enjoy GSP or EVFTA tariff preferences, the corresponding C/O must be submitted.

For goods subject to special control, in addition to the above documents, businesses will have to submit to German Customs a number of mandatory documents depending on each type of goods, such as:

• CE-marking certification for some goods such as toys for children under 14 years old; household refrigerators and freezers; gas fuel burning equipment; machines; medical equipment; measuring tool; electrical equipment…;

• CITES certification for the import of animal samples (live or not), samples of plants and other parts thereof, or samples of products of animal or plant origin;

• Certificate of fumigation, issued by the phytosanitary agency of the exporting country, applies to a number of goods with high risk of containing harmful germs (termites, molds, etc.) such as wooden products (rattan products, handicrafts...), some organic products (coffee, pepper, cashew ...) or goods packages derived from wood (pallets)...;

•  Health, Sanitary and Phytosanitary certificates for a number of products such as vegetables, fruits, seafood...

After the importers submit all the required documents for their consignments, pay all tariffs, taxes and fees and the goods are checked without problems (if the goods are physically inspected), goods shall be released and cleared by German Customs. During the process of customs clearance, imported goods will be stored in Temporary storage under Customs supervision (no more than 90 days) until the goods are cleared.

After being cleared and released, imported goods will be freely circulated in Germany and all EU member territories.

Source: The Center for WTO and International Trade

• Where can businesses find support on the EVFTA and German and Vietnamese markets?
• Where can information and data about the German and Vietnamese markets be found?
• How to take advantage of the EVFTA to effectively import goods from Germany?
• Opportunities from the EVFTA for importing goods from Germany into Vietnam?
• What are the advantages and disadvantages of German goods in Vietnam?