Understanding Bonded Goods in South Africa
In this article, we discuss the ins and outs of transporting bonded goods within or through South Africa to another destination. We also clarify bonded goods terminology, some of which can be confusing.
Bonded goods
Bonded goods are cargo that has been imported or excised, but remains under customs control because the import duties, excise duties, VAT (Value Added Tax) and other relevant customs fees have not yet been paid. This cargo is kept in bonded warehouses under the control of South African customs. The warehouses tend to be situated at a border post or third-party premises. The cargo is only released or cleared from bond when all outstanding payments are settled.
Note: When you import products with the intention of re-exporting them, these products are exempt from customs duties as South Africa is not the end destination. This is to prevent the final importer from paying duties and taxes more than once. The products must be kept in a bonded warehouse and transported by a customs-licensed vehicle for transporting bonded goods.
Transport of bonded goods
The transport of bonded goods is regulated strictly by South African customs. Provision is made for:
- transporting the goods to an alternate bonded warehouse (for example from a customs-owned bonded warehouse to a third-party-owned bonded warehouse), or
- exporting the goods over South African borders.
Should you wish to transport bonded goods, you will be required to register at South African customs as one or more of the following:
- Remover of Goods in Bond
Registration as a remover of goods in bond would need to open a bond at South African customs to get the necessary remover of goods in bond license. A bond is a surety that is given to Customs to cover the tax liability that you may be transporting. If the bonded goods go missing during transport customs will claim the amount due to itself from the surety. The license would enable the transport of the goods both within South Africa and across her borders. Remover of goods in bond licenses are to be renewed annually.
- Remover of goods/Transporter/Road Haulier
A third party, usually a hired company, which transports bonded goods on a client’s behalf is known as a remover of goods/transporter (previously road haulier). The owner of the goods or client is responsible for retaining a bond or surety for the value of the customs taxes, charges and VAT at customs. In addition, the owner/client needs to provide the transporter with a letter indicating that they have given the transporter permission to use their bond. Remover of goods/transporter/road haulier licenses are to be renewed annually.
- Foreign remover of goods
If you are not a non-South African entity and want to engage in the transportation of bonded goods within the borders of South Africa, you will need to register as a foreign remover of goods in bond. You will also need to choose an agent based in South Africa to act as your representative at South African customs.
As a foreign company, you will not be allowed to register your own bond. Rather, the South African-based agent will need to take out a bond in your stead. This bond is called a Consignor bond. Foreign remover of goods licenses are to be renewed annually.
- Carrier
In addition to any of the above, you would also be required to register as a carrier in cases where you intend to cross South African borders with bonded goods. The carrier registration is needed to submit various mandatory documentation, such as the manifests that list what cargo is being carried, to South African customs at border crossings. Carrier registration is a once-off registration. There are no annual renewals.
Carrier registration applies to persons or companies doing cross-border transportation for COMMERCIAL reasons. Where transportation is by private individuals for personal use, no carrier license is needed.
Submission of manifests – Electronic Data Interchange (EDI)
The carrier needs to be registered on the South African customs EDI service to make an electronic submission of manifests. The EDI is a fully automated communication system, requiring minimal or nil user intervention. Other benefits include a 24-hour declaration submission and acceptance window, as well as more rapid cargo retrieval and shorter waiting times in comparison to manual submission.
It is ideal to register as a carrier and for EDI services at the same time.
Moving forward
To get your goods on their way, first register for the applicable remover of goods in bond or transporter and/or carrier licenses. We can assist in making it a quick, fuss-free registration experience.
