IMPORT
Import
The act of bringing in or caused to be brought into any goods or service to a country from another for use of such person or put up for sale constitutes an import. Only import of goods falls within the purview of Customs.
Importer
A living person or a legal person (Company incorporated, or a business registered in Sri Lanka,) who causes an import into Sri Lanka becomes the importer.
Consignee
The living person or the legal person (Company incorporated, or a business registered in Sri Lanka,) to who’s name the goods are sent for clearance, as reflected in the import bill of lading.
Imported Goods
The goods imported into the country are secured in the port, warehouse or any place of security until such goods are entered into next Customs procedure for release for:
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Sale and home-consumption,
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Inward processing,
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Bonded warehousing,
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Bonded manufacturing,
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Manufacturing/ projects under the Board of Investment of Sri Lanka (BOI),
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Entrepôt trade, etc.
The importer or the consignee of the goods imported is required to make a declaration to the Director-General of Customs for clearing the same from the port, warehouse or any place of security subject to inspections.
Goods are normally imported by companies, individuals, government, foreign missions, for various purposes such as importer's own use, for sale, projects, industry, processing and re-export, etc.
Liable for import duty and levies
All goods imported into the country are liable for Customs duty and levies at the rates given in the import tariff in force at the time of making such declaration to Customs.
Generally, duty and levies are calculated based on the value of such goods converted into Sri Lankan Rupees.
Certain commodities incur Customs duty and levies at rates applicable on the quantity of goods imported.
Value for Customs duty in Sri Lanka is the total of Cost, Insurance and Freight charges (CIF Value) converted into Sri Lankan Rupees at the rate of exchange published by the Director-General of Customs.
Exemptions and Deferments
Goods imported for re-export purposes are usually exempted from Customs duties and levies while value-added tax (VAT) is deferred for subsequent settlement on proof of re-export.
Imports for industrial undertakings, and construction projects under the BOI are also entitled for receiving tax exemptions depending on the agreement entered between the enterprise and the board.
In order to enjoy such special tax regimes, importers are required to make Customs Declarations (CusDecs) under respective schemes and submission for processing at separate offices setup for facilitation of the same.
Prohibitions and Restrictions
While most of the commodities are freely importable into the country certain commodities are subject to restrictions and prohibitions aiming social wellbeing, welfare, quality, safety, health and security of the people.
This includes:
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Table of Prohibitions and Restrictions – Schedule B of the Customs Ordinance (Chapter 235)
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National standardization and quality control regulations 2013 (Extraordinary gazette No. 1844/49 of 08 January 2014 under the Import and Export (Control) Act No. 1 of 1969.
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Import Control Regulations issued from time to time under the Import and Export Control Act No. 1 of 1969.
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For importation of restricted commodities require an Import Licence obtained from the Controller of Imports and Exports specifying the description, commodity code (Harmonized System of Commodity Classification system), and quantity on payment of applicable fees.
In obtaining Import Licences, certain commodities may require concurrence from respective line authorities issued to the controller of imports and exports.
Payment Regulations
At imports of goods, regulations concerning the terms of payment shall be adhered to. Failure to do so amounts to a violation of a restriction entailing actions under the Customs Ordinance (Chapter 235) of Sri Lanka.
Special Import Licence and Payment Regulations, No. 1 of 2011 and came into operation on Gazette no. 1739/3 of 02 January 2012
Making Customs Declarations
Importers are required to register with Customs before making such declaration by themselves or through the Customs House Agents (CHA).
Taxpayer Identification Number (TIN) number together with the Value Added Tax (VAT) number issued by the Department of Inland Revenue (IRD) are used by Customs for registration and identification of importers as well as exporters. [Importer/exporter registration procedure]
However, persons receiving gift items and foreign parcels of value not more than 15,000/- Rupees, need no registration for clearance of such goods.
All the import CusDecs are required to be made electronically into the Customs ACCESS system by logging into the system over the internet or a Virtual Private Network (VPN) connection obtained from Customs.
These CusDecs are made under the office code of the Customs office intended to process the CusDec.
a. Customs Import Office Colombo (CBLR1)
Processes all the CusDecs for clearance of goods, imported as sea cargo, under the normal procedure for local consumption as well as for other trade and industrial purposes facilitated by Customs such as Inward Processing and Bonded Warehousing, etc.
At the moment, as no document processing facilities available at other ports of the island, this office facilitates imports through all other seaports in addition to the port of Colombo including the second major port in Hambantota.
b. Customs Import Office International Airport Katunayake (KTIM1)
This office too operates with the same objectives, just like the Colombo import office, but for cargo imported by air.
c. Board of Investment Declaration Processing Offices (CBBI1, KTBI1…)
All cargo both sea and air, imported under the BOI schemes, are cleared on the CusDecs made for such purpose at respective document processing offices of the BOI located in Colombo, Katunayake and Biyagama etc.
Assessment and Payment of Taxes
Once the CusDec is successfully lodged into the ACCESS and registered, an assessment notice can be obtained.
The Assessment Notice indicates the type of taxes and amounts payable under them.
IMPORTER/CHA pays Customs duty and other levies, on the production of the Assessment Notice at the commercial bank of the importer, into the account of the Director General of Customs (DGC).
The bank prints payment particulars on the Assessment Notice.
Payments can be made electronically or by Pay Order.
Processing the CusDec
Printouts of the paid assessment notice of the CusDec, together with number of duplicates (depends on the type of goods or the procedure) of CusDec signed by the importer or the authorized agent, and necessary support in documents shall be submitted at the respective office for processing.
Customs, upon satisfactory processing of the CusDec, issues release instructions to the respective terminal of the port to release the goods to the importer/ agent for moving the same for customs inspections and release.
With effect from April 2020, importers are also now given with an option of submission of CusDecs and scanned copies of all the import/commercial documents and supplementary documents electronically into ACCESS for clearance of goods.
On satisfactory processing of the CusDec releasing instruction (Release order) is issued electronically from the ACCESS computer system to the computer system of the port terminal.
Release of Goods by the port operators/terminal
On the basis of the Customs Release Order, and upon recovery of port charges and reconciliation of necessary import documents, goods are released to the importer or the agent for transporting for Customs inspection.
The terminal issues a gate pass for the transport of the goods within the port up to the exit gate controlled by Customs.
Port Exit Gate
SLPA staff collects SLPA gate pass,
Customs staff collects the pre-printed Customs Gate Pass (two copies),
Customs secure the container with a Customs-Seal,
Customs endorses the time of exit, and the seal number,
One copy of the Customs gate pass is issued to the Importer/Agent for transport to the examination yard or to importers own go-down if release on “GREEN CHANNEL”,
Customs update the ACCESS system for container exit.
Examination and Release of Goods by Customs
Examination based on the selectivity criteria of the Customs risk management policy.
Includes non-intrusive inspections to detail examinations unloading all the goods in a container.
Intensity of examination is determined according to the level of assessed risk.
Aims of examinations include verification of contents, quantity and value etc.
Physical documents (CusDec copies and supporting documents) are collected at examination,
Customs gate pass is issued for transport.
False declarations, concealment, violation of prohibitions and restrictions entail severe penalties, forfeiture of goods and legal actions before the Courts of law.