If the product (raw material or semi-finished product) your company imports cannot be supplied in sufficient quantity in the European Union, the company can apply for Duty Suspensions or Tariff Quotas.
The duty suspensions will allow unlimited quantities to be imported into the EU for five years and tariff quotas will allow the importation of limited quantities for a period from 6 to 12 months.
There are 2 annual deadlines for applications under the Tariff suspension Scheme, one in early January and the other in July. Note that the quota/suspension does not come into effect until a year after the deadline date. For example, applications submitted by the deadline in January 2018 will not come into effect until January 2019.
To be eligible, the application must meet the following criteria:
- The applicant must be established in the EU
- The applicant must have had recent contacts with potential suppliers and EU manufacturers at the time of application. Note that these contacts must be documented (letters, faxes, emails) and included in the application.
- Applicants must be using the product, or involved in significant manufacturing/processing of the product, and ensure the imported products are not covered by an exclusive trading agreement.
- Precise product description. Note that the goods must be raw material or semi-finished products. Finished products won’t be granted suspensions/quotas. Include the CAS number if the product is a listed chemical.
- Product(s) must be correctly classified for customs purposes. If the correct classification is in doubt, a Binding Tariff Information (BTI) application may be required.
- Anticipated and current imports as well as the applicable duty rate at the time of request, together with estimated uncollected customs duties (duties expected to be paid in the year indicated). Note that the estimated amount must be over €15,000 per year.
Applications must also state
- The origin of the goods.
- If the goods are subject to a patent.
- If the goods are subject to any anti-dumping or anti-subsidy measure.
Note that the duty suspension will apply to the tariff code rather than the applicant, therefore it is important to make the application as specific as possible to avoid competitors using the duty suspension. The other side to this is that a competitor may have applied for the suspension of a product that you are using so it is worth reviewing 1) that you are correctly classifying your product, and 2) if an autonomous duty suspension is applied to this tariff code. Having a product misclassified in this instance could lead to missing out on a valuable duty break in place.
If you wish to obtain further information on the application process for autonomous duty suspension or wish to review if your imported raw materials already have a suspension in place, please contact BDO.
For more information about our partnership with BDO Ireland click here.