Step1: Obtain a PFI (Proforma Invoice) with all
Import or exportable cargo details, this must include;
Names and Addresses of supplies and Nigerian
Receivers, telephone, emails, types and quantity
Of packages, Weight, Unit price, country of Origin
and destination loading and destination port.
Step2: Approach any Nigerian bank with the
PFI to obtain Monetary Control form (Form “M”)
this must be filled out with PFI Information with
added Custom code relevant to particular products.
Step3: Submit filled Form ‘M’ with attached
PFI and Marine Insurance coverage on the
monetary value of intended imports. Additional
requirement Nigerian Government Agencies Regulatory
Permit on Control Import or Exportable cargo, Examples;
National Agency for Food and Drugs Administrative
Control (NAFDAC), Standard Organization of Nigerian
(SON) Permit. The Import process begin upon submission.
Step4: Form ‘M’ approval from Nigerian banks with a
Generated Form ‘M’ number and BA number as well as
Nigeria Government appointed Agencies for:
Declaration Verification checks VIS-À-VIS
Documents integrity, values i.e. COTECNA INT’L, SGS etc.
Step5: Transmission of approval Form ‘M’ Number
and BA Number to supply for immediate cargo
loading on board vessel as well as issuance of B/L
as evidence of contract of shipment, Commercial Invoice
actual parking list, country of origin and value certificate
Control document filling
nxp, form ‘m’ pfi characteristics and defination
BUYER INFO: (buying or selling overseas)
FORM ‘M’ and PFI filling must provide, full name, telephone, city address, state and country(not P.O. Box) of the consignee/ buyer of importing or exporting cargo.
BUYER FIRS TIN NO/ RC NO/ PP NO
The PFI, NXP & form ‘M’ must provide the buyer/ consignee inland tax identification number, company corporate registration number, or personal individual international passport number. This number must be registered with Nigerian customs service for the generation of taxable duty in favour of whom is responsible for duty payment.
SELLER INFO (ABROAD)
The consignor or supplier full name, telephone, city, state, and country address (not P.O. Box) must be provided on form ‘M’, NXP & PFI.
COUNTRY OF ORIGIN/ DESTINATION.
The port of loading, country of origin, port and country of discharge and destination must be clearly provided.
CARGO DESCRIPTION/ QUANTITY AND PACKAGING MODE.
Specific cargo description name NOT generalized cargo name, quantity, unit price per piece or package, this will help easy custom tariff harmonized classification process and fast duty tax rate application.
MONETARY CONTROL NUMBER.
PFI, NXP and form ‘M’ must have clearly stated bank generated form numbers. Only PFI numbers is generated by supplier base on stock- order contract, importantly is the bank approval (BA) numbers.
TARRIFF HS CODE.
Form ‘M’ and NXP filling must provide correct HTC (harmonized Tariff Code) and SPC (Schedule Sectional Purpose Code) for the importing or exporting products. This can be found within 563 pages of Nigerian custom service (CET) common External tariff documents.
EXPORT BOOKING/ STUFFING NOTE.
The filler need to provide specific location, address where the cargo will be loaded into container as well as the quantity, unit price as well as the full details of contract person telephone name, fax, email, and address of cargo buyer and supplier.
BILL OF LADING.
This is the evidence of contract of shipment, the shipper/ supplier evidence of deposit of product to the carrier for onward transportation to destination port.
The bill of lading/ airway bill number is most important number for import & export transaction, it can either be Master bill of lading (MBL) or House bill of lading number (HBL) whichever is adequate and must be filled accurately, importantly this number is the linkage number for all shipment activities. B/L provide the mode of shipment either air, sea or land.
CONTAINER/ BOOKING NUMBERS.
This number is another vital link for the shipment as this is an access code for cargo tracking in transit.
Import and immediate export cargo and products legally permissible must arrive or dispatch through customs port of entry, the product must be authorized for delivery by Nigerian customs service (NCS). This will normally happen after the filling of customs entry form SGD 2010 that relate to specific type of import or export product by either the importer/ exporter directly or by their appointed customs licensed agent preferably before the arrival of the cargo. Customs approval on the filed entry will not be fully granted until the cargo is within limit of custom secured port area.
Import not filled for custom entry by air flight after 15days will be labeled unclaimed as well as that of sea shipment after 21 days. If still not filled for entry at the end of 90 days, three months, the merchandise will be gazette and sold at auction. If a shipper is not able to appropriately filled in a custom entry, he then appoints a commercial customs licensed agent who may act on his/her behalf. Commercially licensed custom agent registration at customs headquarters is by corporate company licensing. A list of genuinely licensed agent is available at Association of Nigerian licensed Agent (ANLCA) secretariat established since 1954 under the act of Nigerian Customs Services personnel and staffs. An unlicensed person is prohibited by laws from performing this task for importing public. However, Nigerian Customs Service employee will advise and give relevant customs requirement information on demand to importer or exporter.
All merchandise including goods imported for personal use or business coming into Nigeria must be cleared at Customs and is subject to a Customs duty unless specifically exempted by law. Clearance involves a number of steps: entry, inspection, appraisement, classification and liquidation. The Nigerian Customs Service does not require an importer to have a license or permit. Other agencies may require a permit, license, or other certification, depending on what is being imported. Customs entry forms do ask for your importer number. This is either your FIRS, TIN or RC business registration number, or if your business is not registered, or you do not have a business, your Nigerian International passport, national Identity card or Nigerian drivers license. The importer must declare the dutiable value of merchandise, this is called self-assessment declaration at designation point (Nigeria). The final appraisement is fixed by Customs. Several appraisement methods are used to arrive at this value. The transaction value serves as the primary basis of appraisement. Transaction value is the price actually paid or payable by the buyer to the seller for the goods imported. Other factors may also add to the dutiable value of merchandise, such as packing costs, selling commissions, royalty or licensing fees, etc. When the transaction value cannot be determined, then the value of the imported goods being appraised is the transaction value of identical merchandise. If merchandise identical to the imported goods cannot be found or an acceptable transaction value for such merchandise does not exist, then the value is the transaction value of similar merchandise. Similar merchandise means merchandise that is produced in the same country and by the same person as the merchandise being appraised. It must be commercially interchangeable with the merchandise being appraised. The identical or similar merchandise must have been exported to Nigeria at or about the same time the merchandise being appraised is exported to Nigeria. The importer must determine the classification number of the merchandise being imported. The Harmonized Tariff Schedule of the Nigerian Customs Services (NCS), issued by the NCS board, prescribes the classification of merchandise by type of product; e.g., animal and vegetable products, textile fibers and textile products. The importer must pay estimated duties and processing fees if applicable. Customs makes the final determination of the correct rate of duty. The duty rate of an item is tied to its classification number. The CET provides several rates of duty for each item. Customs duties are generally assessed at ad valorem rates, a percentage of which is applied to the dutiable value of the imported goods. Some articles, however, are dutiable at a specific rate (so much per piece, liter, kilo, etc); others + special levy that is additional & specific duty rate. If formal entry is required - the importer may have to post a bank/surety bond. It is the importers responsibility to ensure that his or her goods being imported meet admissibility requirements - such as proper marking, safety standards, etc. - and that the proper permits, if required, have been obtained in advance of the goods arriving in the Nigerian Customs secured port e.g. Standard Organization Conformity Assessment Programme Certificate (SONCAP), Drugs, foods & chemical permit from National Agency for Foods, Drugs Administration and Control (NAFDAC) etc
All goods that enter Nigeria are categorized according to the Harmonized Tariff Schedule. The act of placing goods into the correct category is called classification. Classification determines how much duty will be collected. Classification is more than simply looking up an item in an index. It is a very complicated process requiring the application of the General Rules of Interpretation; the section, chapter and subheading notes; and the Explanatory Notes. The importer is responsible for properly classifying his merchandise before entry. If he is not sure how to properly classify an item, he can submit a request, in writing, for a binding classification ruling to the:
Comptroller general Of Customs,
ATTN:
Comptroller Tariff and Trade ,
Nigerian Customs Services Headquarters,
Wuse Zone 3,
Abuja.
The rulings will be binding at all ports of entry unless revoked by the NCS Headquarters' Office of Tariff and Trade. Mickey Excellency Nigeria Limited will more often find your HTS classification on your behalf as part of our service to you.
WHAT IS A NCS BOND?
A NCS bond is a contract that is given to insure the performance if an obligation imposed by law or regulation. The most common use of a NCS bond allows importers to take possession of their goods before all NCS formalities are complete. Another use allows a carrier to move goods under bond from one place to another before those goods are actually entered for consumption with duties paid.
Who are the parties to a Custom Bond ?
All Customs bonds are financial guarantees between 3 parties: the bank/Insurance/Surety company issuing the bond, the Principal (who is required to file the bond), and Nigerian Customs Service (NCS). The bond guarantees NCS that if they cannot collect monies due from the Principal they can seek remedy, up to the bond amount, from the Insurance/Surety Company. The bond also compensates the Insurance / Surety Company, allowing them to use any legal means to collect from the Principal any monies that were paid to NCS on the Principal’s behalf. All parties that import goods into Nigeria for commercial purposes or transport goods through Nigeria may have a need for NCS bond.
The principal on a bond can be an importer, a broker, a carrier, a bonded warehouse proprietor, a foreign trade zone operator or anyone that seeks to do business with NCS. The surety is usually a bank or an insurance company that has been authorized to write bonds. The surety and the principal are known as the bond obligors while the NCS is the beneficiary on all authorized bonds. If a principal fails to execute its obligations, NCS can make a claim against the principal and surety under the terms of the bond
What formalities are associated with a Customs bond ?
All NCS bonds must be in writing. To prevent errors from occurring, there must be a witness present when the signature of the bond obligor is signing as an individual. When a corporation needs to sign a NCS bond, it allows a corporate officer (who has power of attorney) to sign for it. No witnesses are needed when bonds are completed by authorized officials.
What are the types of bonds ?
Continuous Transaction Bond is a self-renewing term Importer Fast-track Entry Bond, which covers all Customs transactions through all ports of the country. The bond amount for a continuous bond is determined by duties, taxes and fees paid by an importer during the last calendar year. The minimum fast track continuous bond amount is N20,000,000. This bond is valid until it is terminated by the principal (importer) or the surety (banks).
Single Entry Bond is a one-time Importer Entry Bond for a particular import shipment, which can only be used for one Customs transaction. The bond amount for a single transaction bond is equal to the total entered value of the merchandise plus all duties, taxes, and fees. However, if the merchandise is subject to other government agency requirements or visa/quota requirements, the bond amount would be equal to three times of the total entered value. The general practice with NCS is the bond value covering all duties, taxes and fees only. Example of such bond is ship spare and stores, temporary importation, exhibition goods and goods-in-transit.
Drawback Payment Refunds allows an importer to obtain a refund of 99% of the duties paid on imported goods upon providing proof these goods were exported example is EPZ produced goods.
Custodian of Bonded Merchandise covers the activities of bonded merchandise warehouses, carriers and container stations. All of these business types are responsible in the course of their activities for merchandise which has not yet been entered into the commerce of Nigeria government and on which duties are still due. Such goods are referred to as being in-bond.
International Carrier Bond ensures operators properly manifest all goods and passengers they carry, pay for the overtime services of Customs officers and comply with all regulations related to the clearance of their vehicles.
Foreign Trade Zone is considered non-Nigerian territory for Customs’ purposes and foreign goods placed into the Export free trade zone (EPFTZ) may be manufactured, manipulated, repacked or exported without paying duties.
What are the obligations of the parties?
An importer's bond obligations require him to pay duties and submit entry summary documentation at the times required by law and to redeliver merchandise to NCS upon lawful demand. The basic custodial bond requires that the custodian of bonded merchandise comply with regulations relating to such merchandise and produce records upon demand by a NCS officer. If obligations are not met then NCS may access a claim against the principal and surety under the terms and conditions of that bond. If the bond principal cannot or will not perform its obligations then NCS can make demand for payment on both the principal and the surety.
Where can I get a bond ?
You can visit any NCS legal port command, bond & license seat.
Where are NCS bonds filed ?
Single entry bonds should be filed in the port where the transaction is taking place while continuous transaction fast-track bond is filled at customs headquarters.
Must Bank Guarantee Bonds always be in usage?
Surety Bonds don’t always have to be in usage, unless on specialized temporary exemptible or deferred duty payment pending the final decision of applicable duty payable by principal. A normal alternative is the prompt payment of duty tax through accredited bank by cash or bank draft. One major disadvantage for surety bank bond that enable immediate cargo possession while final decision of duty payment is on hold is that the taxable amount plus additional 10% is held by NCS through issuing bank/ insurance company until bond is cancelled or upheld by custom timeframe of 180days. Literally, it means that the liquid cash must be present in the importer’s bank account for the duration of time.
Where can further information be obtained ?
For any other information on NCS bonds please visit www.ncs.gov.ng
.Paying Duty:
The importer is ultimately responsible for paying any duty owed on an import. Determining duty can be very complicated, and while shipping services will often give an estimate for what the duty rate on an item might be, only NCS can make a final determination about what is owed. You should not be misled into thinking your purchase price includes duty because the seller cannot say with absolute certainty what the duty will be. As a rule, a purchase price that includes shipping and handling does not include duty or any costs associated with clearing the goods through NCS. First time importers are often surprised by bills they receive for duty, Customs licensed agent processing fee, which are actually charges for the services of the licensed customs agent who cleared your goods through NCS.
How you pay duty depends on how your goods were shipped. If your goods were shipped through the International Postal Service, you will need to pay the mail carrier and/or go to your local post office to pay any duty and processing fees owed when your package arrives at that post office. If your goods were sent by a courier service, that service will either bill you for the duty they paid on your behalf or require payment on delivery.
If your goods were sent by freight, there are two possible scenarios for paying duty.
• If no arrangements were made to forward the goods to your door, you will need to either clear them through NCS yourself, in which case you will pay duty directly to NCS at the port where your goods arrived. Alternatively, you will need to arrange for a customs licensed agent to clear your goods. If you hire a customs licensed agent, they will bill you for their services and any duty they paid on your behalf.
• If arrangements were made to forward your goods to you, you will be billed for any duty owed, and for the services of the customs licensed agents who cleared them through NCS.
