Like most other Latin American countries, there are extremely lucrative opportunities to be explored when exporting to Argentina. However, there are also many pitfalls when in an experienced Shipper or Freight Forwarder attempts to go there for the first time. There are many important factors to consider, and here we explore some of the ups and downs.
Although improvements are being made, there still exist some pronounced challenges that businesses encounter when exporting to Argentina or doing business there. Among these, we find:
Imports: The primary objective of customs agents in Argentina is to prevent illegal narcotics, weapons and ammunition, explosives, and other explicitly illegal material from entering the country. The list of prohibited goods is subject to change at any time, which makes it difficult to adhere to, even when conducting legitimate business. Bearing in mind that Customs Agents have the right to open packaging and inspect merchandise at their own personal discretion, there is risk of delays or even damage. To speed up the Customs approval process and ensure entry, all documentation must be correctly filled out and submitted at the time of shipping.
Among the recurring restrictions: exporting cultural artifacts and samples of flora and fauna threatened with extinction is not permitted. Certain agricultural products (such as meat, dairy, wheat, corn, etc.) can also become temporarily forbidden when the national market struggles.
Export Clearance: Movement of goods within Mercosur (an economic and political bloc comprising Argentina, Brazil, Paraguay, Uruguay, and Venezuela) is free except for restricted goods. To leave Mercosur boundaries, customs clearance is needed. The customs office not only verifies all export declarations, but it can also control the movement and authorizes the seizure of merchandise.
These customs declarations must include details on the origins, the tariffs and valuation of the goods.
Argentine Customs Agencies use a Harmonized System for classification of goods. Current regulations (as of 2015) separate all customs codes into 2 main categories: Automatic import licences and Non-automatic licences. Under these laws, it is expected that most licences are accorded (unless there is suspicion of ‘dumping’ involved).
Categories which are now excluded from the Non-automatic licence requirement:
The valuation method for import duties is based on the Cost, Insurance and Freight (CIF) model.
Customs Duties (or Import Duty) and taxes will be pending and need to be cleared while importing goods into Argentina, be it by a private individual or a commercial organization.
|Duty Rates||Average Duty Rate||Sales Tax(GST)||Threshold on goods|
|0% to 35%||22.27%||21%||No duty if below FOB is below $25|
US$500 is the Statistical Fee charged to the maximum and some are at the rate of 0.5% (CIF). Excise duty will be applicable on alcohol and tobacco products.
Average Customs Duty: Transactions within Mercosur boundaries are free of duty, though there are considerable exceptions. Re-exporting goods within Mercosur does not entitle one to an exemption from customs duties. Customs tariffs applied to goods outside of Mercosur typically range between 5-14%. Companies that import industrial tools for their own use can be exempted from an import tax. The stringency with which Customs officials adhere to guidelines is reported to vary based on the current economic situation. To avoid companies under-invoicing, Argentine Customs are entitled to apply a predefined value for the calculation of customs duty. These reference values are not published, nor are the evaluation criteria.
There are also restrictions on foreign currency paying import duties. Argentine tax authorities must give their approval beforehand.
The most popular import purchases for Argentina in 2017 ranked as follows (with percentage of total dollar value indicated).
Inspections and approvals for incoming goods in Argentina are conducted by these Quality Control Organizations: Bureau Veritas in Argentina, Argencert Argentina, SGS Argentina. Local Export Control Organizations in the country of origin grant approval for the export of commercial goods. It is up to the shipping organization to verify that their goods meet the legal requirements for export.
International goods entering from outside Mercosur borders do so primarily by sea. The port of Buenos Aires handles about 60% of shipping traffic and the port of La Plata comes in second. The Uruguay and Parana rivers are crucial for connecting Buenos Aires with economic centres within the country, as well as to Brazil and Paraguay.
Road transport dominates the movement of goods (national and regional) within Argentina, with rail and air following far behind. The road network covers almost the entire country, though most of it is in poor condition.
A wealth of information to be aware of, and this is only the beginning when exporting to Argentina. All the more reason to be vigilant and only deal with the best Freight Forwarder in the industry.