Import Guide

Import Procedures and Documents

Imports from India are normally paid in Indian Rupees. However, if the payment is made in hard currency, the imported goods are exempted from payment of excise duty in India. Currently, the government allows imports of 161 products from India with payment in hard foreign. Nepal Rastra Bank (NRB) issues the list of the products, which are entitled for import under hard currency.

For imports from third country, the government does not allow advance payments for goods and separate payments for freight. In addition, with the exception of prohibited and quantitatively restricted goods, there is no restriction on the release of foreign currency for importing any type and quantity of goods. But to obtain foreign currency from the commercial bank, the importer has to open a L/C by fulfilling the requirements of the bank.

Irrevocable L/C is the commonly used documentary credit for the settlement of payment in imports from third countries 

An importer fills in a foreign exchange control form BBN 3 requesting the bank to open a L/C in the name of a nominated overseas exporter, and submits it along with an undertaking of the importer indentifying the bank against any liability, and other supporting documents. Depending upon the credit limit sanctioned by the bank for L/C purpose and the relation with the bank, the importer is generally required to deposit an amount ranging from 10 to 100 percent of the L/C value at the bank. Note that the transaction may not necessarily be channelled through banks. Banks are authorized to draw drafts or telegraphic transfers (TTs) for settlement of payment in credit imports, provided that the Nepalese importers approach banks with documentary evidence. Much of the imports from India are under this scheme due to extra cost attached to payment through L/C.

For importing raw wool, TEPC issues a recommendation letter (wool specification test report) specifying the quantity and standard of wool to be imported by an applicant/importer in the name of the concerned bank.  Under the widely used “Sight L/C”, full payment is made to the exporter by the correspondent bank at the time of submission of shipment documents as specified in L/C. Similarly, the Nepalese importer is also required to make full payment to his bank at the time of release of shipment documents. 

Import Licensing, Permits and Pre-Shipment Inspection (PSI)

  • Except for prohibited and quantitatively restricted items, no licence is required for imports.
  •  The Government of Nepal only allows import of quality wool—minimum length of 4" with a thickness of not more than 38 microns. Thus, a test certificate from an authorized agency is to be produced at the time of customs clearance.
  •  Import restrictions on old vehicles, including three wheelers and two stroke motorcycles, in terms of the permissible level of smoke emission are also in application. In most cases, a test certificate issued by the manufacturer/producer/certifying authority at the place of origin is required for customs clearance purposes.
  • For importation of plant and plant products, an importer has to apply to the Plant Quarantine office for import permit. The application form is to be filled in with details of the plant and purpose of importation, and must be submitted with documents like income tax registration and enterprise registration, and recommendation letter of a concerned institute, if imported for research purposes, are also submitted along with the application.
  • Plant Quarantine Section of the Department of Agriculture and seven other quarantine check posts conduct quarantine examination and issue import permits and phytosanitary certificates.
  • Nepal Customs does not require any PSI and there is no generalized system of PSI. A few commodities like wool, pharmaceuticals and industrial chemicals may need pre-shipment quality inspection certificates to maintain certain standards in Nepal.

Importing from India

a)     Importing from India (Duty Refund Procedure)

  •   While importing goods from India through Duty Refund Procedure (DRP) process, the amount of excise duties imposed in India will be deducted from the customs tariffs paid by the importer to Nepalese customs.
  • Only 24 specified customs offices (Agreed routes) that were agreed upon between India and Nepal support importing goods from India via DRP process.
  • Under the DRP process, on arrival of the commodities in the customs office, the importers themselves, or their appointed customs agent, must submit the following documents to the Nepalese custom

 i.        Authority letter of CA

ii.         Bill of lading/delivery order

iii.         Delivery order of Terminal Management Company (TMC) in case of inland clearance depots (ICDs) at Biratnagar, Birgunj and Bhairahawa

iv.         Invoice

v.         Nepal Invoice (DRP Form)

vi.         Nepalese Customs Declaration

vii.         Packing list

viii.         Additional documents for specific cargo such as plant  quarantine/health/phytosanitary certificates for plants, lab test report for food products, analysis report for chemicals, health certificate for raw wool, veterinary certificate for animals, etc. where applicable.

b)    Importing from India (In-bond process)

  • Under the in-bond process, the payment for imported goods is made through the bank in convertible foreign currency. Indian exporters are required to enter into a bond contract after which the commodities can be exported to Nepal. The export consignment is the verified on its arrival at the Nepal Customs, upon which the contracted bond will be released. Note that only limited products specified by the Nepal Rastra Bank (Central Bank) can be imported from India through the in-bond process.
  • While following the in-bond process, on arrival of such commodities in the Nepalese customs, the CA must submit the following documents:

i.         Authority letter of CA

ii.         BBN Form 4 of NRB while clearing goods

iii.         Bill of lading/delivery order

iv.         Certificate of L/C or advance payment

v.         Delivery order of TMC in case of  Inland Container Depots (ICD) at Biratnagar, Birgunj and Bhairahawa        

 vi.         Invoice

vii.         Nepal Invoice (In-bond form) Nepalese Customs Declaration

viii.         Packing list

ix.         Additional documents for specific cargo such as plant quarantine/health/phytosanitary certificates for plants, lab test report for food products, analysis report for chemicals, health certificate for raw wool, veterinary certificate for animals, etc. where applicable.

  •   Upon submission, the customs office takes the process further and sends the commodities for clearance upon imposing required tariffs.

          c) Importing from India through local purchase process

  •  Any import process other than D.R.P and in-bond is categorized as local import. The CA must submit the submit the following documents

i.         Authority letter of CA

ii.         Delivery order of TMC in case of Inland Container Depots (ICDs) at Biratnagar, Birgunj and  Bhairahawa         iii.         Invoice
iv.         Nepalese Customs Declaration

v.         Packing list

vi.         Additional documents for specific cargo such as plant quarantine/health/phytosanitary certificates for plants, lab test report for food products, analysis report for chemicals, health certificate for raw wool, veterinary certificate for animals, etc. where applicable.

 

  • Upon submission, the customs office takes processes the application and sends the commodities for clearance upon imposing required tariffs.

Importing from third country via India

a)     Entry into Nepal

  • The Customs valuation provides a basis for declaration of value by an importer in the Nepal Customs Declaration Form for the calculation of applicable duty and tax.
  • The customs duty on imported goods is assessed on the basis of their transaction price. The owner of the goods is required to submit to the Customs bills and invoices showing their price, as well as such other necessary documents relating to imports as demanded by the Customs for the purpose of verifying their transaction price.
  • No demurrage is charged on the imported goods until they are valued for the purpose of assessing customs duty.
  • After the cargo reaches Nepal border, the importer or CA has go to the Nepalese Customs with the following documents:
  1.  BBN 4 form of The Nepal Rastra Bank (Central Bank)
  2. Bill of lading/delivery order
  3. Certificate of insurance
  4. Certified copy of L/C or advance payment
  5. COO (this is not strictly required except where imported goods are subject  to a special tariff concession on account of their place of origin
  6. CTD (Original)
  7. Delivery order of TMC in case of Inland Container Depots (ICDs) at Biratnagar, Birgunj and  Bhairahawa
  8. Enterprise registration certificate
  9. Invoice
  10. Letter of authority of CA
  11. Nepalese Customs Declaration (white colour)
  12. Packing list
  13. VAT registration certificate/PAN
  14. Wool specification test report if applicable
  15. Additional documents for specific cargo such as plant quarantine/health/phytosanitary certificates for plants, lab test report for food products, analysis report for chemicals, health certificate for raw wool, veterinary certificate for animals, etc. where applicable
  • The documents numbered 1, 2 and 12 are not normally required for clearance of duty free goods or imports by the Government.
  • The requirement of certificate of insurance by the Customs is only for customs valuation. Any insurance document submitted by the importer is acceptable to the Customs for valuation purposes.
  • The Customs verifies BBN 4 document issued by a commercial bank with BBN 3 received previously from the same bank at the time of opening L/C. After the goods are cleared, the Customs certifies BBN 4 and hands over to the importer for delivering to the issuing bank.
  • After the documents have been checked. Customs assess the applicable duty and VAT for payment by the importer before releasing the cargo. When the goods are cleared after the payment of customs dues, the Nepalese customs officer endorses the original and 3rd copy of CTD, and the original is returned to the importer and sends back the 3rd copy in with a covering letter for delivery to the corresponding Indian Border Customs.
  • The importer is required to submit the original CTD to the corresponding Indian Border Customs within 15 days of the date on which the goods were released at the Indian port of entry or such extended time as the concerned Assistant Commissioner of Customs House may allow.

Importing from Bangladesh

  • The Protocol to the Transit Agreement signed between Nepal and Bangladesh for Nepal’s trade with third countries applies to bilateral trade between Nepal and Bangladesh. Thus, the procedures and documentation for importing from Bangladesh is same as those applied on imports through Bangladesh. 

Importing from third country via Bangladesh

  • All the procedures prescribed for third country trade have to be followed at the border at both the Indian and Nepalese Customs. 

Importing by Air

  • After the arrival of the cargo, the CA approaches the TIA Customs with the  following documents:
  1.      Air waybill
  2. BBN 4 form of NRB
  3. Certificate of insurance
  4. Certified copy of L/C or advance payment
  5. COO (this is not strictly required except where imported goods  are subject to a special tariff concession on account of their place of origin)
  6. Enterprise registration certificate
  7. Invoice
  8. Letter of authority for CA 
  9. Nepal Customs Declaration
  10. Packing list
  11. VAT registration certificate/PAN
  12. Additional documents for specific cargo such as plant quarantine/health/phytosanitary certificates for plants, lab test report for food products, analysis report for chemicals, health certificate for raw wool, veterinary certificate for animals, etc. where applicable.
  13. Wool specification test report if applicable
  • Customs use the transaction value as the basis for customs valuation, and thus require the certificate of insurance for customs valuation purposes. 
  • The importer or CA pays the customs dues and approaches NTWCL with the customs declaration and payment receipt to obtain release of the cargo. The importer arranges loading and transportation of cargo from airport godown to his warehouse.

 

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