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PART 3: Importing Documents and Payment Methods
If you are a first time importer to South Africa, we suggest that you have all the required documentation before submitting to your clearing agent to ensure that it all goes smoothy.
Importing documents
We also recommend having literature (which are pictures, descriptions and compositions of the items) to ensure that any query with South African customs is resolved quickly. Being prepared means no unnecessary additional costs.
Your customs documentation must be kept for a 5 year period as customs can at any time do an audit on your South African imports to ensure the correct import tariff headings were used. We suggest that you ensure that you give your service providers / clearing agents the following documentation within 10 days of shipping to South Africa to ensure that its pre cleared by customs before arrival and if there are any queries by customs this can be resolved before arrival into South Africa so as to avoid any unnecessary storage charges.
At Tradestream we offer this as a value added service where we assist with the follow up and request the necessary documentation from the supplier and forwarder.
- Bill of lading
- Commercial invoice (discussed in detail under How to Export
- Packing List How to Export
- Certificate of origin, if required and can be obtained from your local chamber of commerce
- EUR 1 certificate
- Fumigation certificate – usually with any wooden products
- Health certificate – when importing foods or perishables
- Import permits – if required, usually for second hand goods
Documents on arrival in South Africa: Customs documentation – Customs release, SAD500, SAD507 additional information, Customs worksheet.
The bill of lading (BOL): This is a transport document for sea freight. It is completed by your service provider who will issue you with a house bill and they will have an ocean bill with the container details on. It serves as confirmation that the cargo is on board and has departed to South Africa, as well as the incoterms. The BOL sets out all the terms of the contract of carriage. If a BOL incorporates a clause stating that the carrier reserves the right to tranship, then the transhipment is allowed even if an accompanying Letter of Credit (L/C) prohibits transhipment.
THE BILL OF LADING ALSO PERFORMS THE FOLLOWING FUNCTIONS:
- A contract of carriage between the shipper of the cargo and the carrying shipping company.
- The name of the shipper and the receiver of the goods, namely the consignee.
- The contents of the packages as declared by the shipper.
- Shipping details such as the port of loading and the port of discharge.
- The bill of lading is a freight invoice and indicates if the freight costs have been prepaid by the exporter or will be paid by the importer, “freight collect”.
- The bill of lading states the number of packages, weight and dimension of the shipment.
- It is a document of title to the goods stated thereon.
Types of bill of ladings required for release
Original bill of lading (usually states number of copies on the bill): The original and stamped bill of lading will be required by the forwarders for the release of the cargo, thereby allowing them to deliver the goods to your premises. The original bill of lading is usually couriered to you as the buyer or the bank, dependant on the payment terms.
Telex bill of lading: This is when the supplier surrenders the bill of lading on their side to the forwarder thereby entitling them to release the goods to you as soon as it’s arrived in South Africa without any form of original documentation – this could be due to a long standing relationship or if you have paid the supplier before the goods have arrived in South Africa. A telex / surrender bill of lading can be arranged by the shipper.
Payment methods
Open Account vs. LC: This is dependent on the supplier. An open account is when you have created a stable relationship with your supplier and they allow you to pay them via telegraphic transfer. As a first time importer the supplier might request that you either pay in advance or pay a 30% deposit before starting with the order and then the balance on shipment. This can change the more you ship with the supplier and as you build up a relationship, the supplier might require a Letter of Credit (LC). Depending upon the terms stipulated on the LC, generally the supplier is paid via your bank on presentation of the required documentation that proves he has supplied the goods in accordance with the terms.
Costings
On arrival and clearance you can cost your cargo into stock. Tradestream can assist you with final landed costings per item. As we do with the pre-shipment estimate, we complete the final costing based on the rate given by you (forward cover rate). In addition, we provide a variance analysis against your pre-shipment costing so that you have full transparency as to where the costs have varied. This assists in querying over charges.
As can be seen, there are many processes and documents involved when importing goods into South Africa. This has been a very brief overview of the requirements and processes, and of course there are many areas where there is a lot more depth and specific requirements. As an international trade management solution, Tradestream can manage the entire international trade process for you, allowing you to concentrate on the things that matter most in your company.[/vc_column_text][/vc_column][/vc_row]