Import operations are the lifeblood of trade between countries and play an important role for businesses operating in many different sectors. Importing may seem easy, but it is actually a highly detailed and complex process.
Today, we will discuss what importing is, how to do it, and points to consider. You will gain knowledge on many topics ranging from the benefits and disadvantages of importing to necessary documents for import, customs duties, and protective measures.
If you are ready, let's begin!
What is Import?
Importing is the process of bringing goods or services into a country or region from the outside. This operation is carried out to supply products that are not available or not available in sufficient quantities in local markets. The import process constitutes an important part of trade between countries and is an essential tool for economic growth, job opportunities, and consumer choices. For example, Turkey imports high amounts of wheat and petroleum because domestic production cannot meet the demand.
What is the Release for Free Circulation Regime?
The release for free circulation regime is a customs regime applied to the entry into Turkey of products imported from foreign countries. Under this regime, customs duties on products imported into Turkey can be reduced or reduced to zero in accordance with trade agreements.
The release for free circulation regime provides a significant advantage for companies wishing to import. The reduction or elimination of customs duties allows products to enter Turkey at more affordable prices. This, in turn, enables products to become more competitive and allows consumers to purchase quality products at cheaper prices.
However, products imported under the release for free circulation regime must comply with regulations in Turkey. Therefore, companies wishing to import must check the compliance certificates and standards of the products. Otherwise, the entry of products into Turkey may be blocked or punitive action may be applied.
Things to Know Before Importing
Before importing, there are many details you need to know. Although importing is a profitable business, it can end in disappointment if you do not look at the right points.
First, you need to conduct detailed research on the product you will import. You should make an analysis by examining the demand for the product in the market, competitor products, the quality of the product, price, and other similar factors. In this way, you can determine which products you will import and which products will bring you profit.
Secondly, you must take into account the customs duties and other related costs of the products you will import. Customs duties, port operations, transportation fees, and other logistics costs of products can be quite high. Therefore, you also need to take these costs into account.
Additionally, you should check whether the products you will import comply with quality standards and safety measures. It is highly important that products do not contain substances that could be harmful to health and comply with quality standards. Therefore, you must be very careful about the safety and quality of the products you import.
Finally, you must be very meticulous when choosing a supplier. It is extremely important that the supplier from whom you will procure the products you import is reliable and offers quality products. You should not purchase products before researching the supplier's financial situation, product quality, and reliability.
Who Can Import?
Importing is a business model that holds an important place in world trade and is preferred by many people. However, it is not possible for everyone to import. To be able to import, certain criteria must be met. These criteria can be listed as follows:
• Companies engaged under commercial activities: Companies that want to import are obliged to engage in commercial activities in Turkey. If you have a registered company in Turkey, you can import on behalf of this company.
• Individual entrepreneurs: Individual entrepreneurs in Turkey can also import. However, individual entrepreneurs also need to open a business to carry out their commercial activities.
• Firms in foreign countries: A firm registered in foreign countries can import its products to Turkey. However, these firms must open a representative office or branch in Turkey.
• Individual importers: Individual importers can import products in their own name without having a registered company or business in Turkey. However, individual importers also need to follow specific procedures.
The persons in this list must first be registered in Turkey in order to import. Additionally, the products you want to import must comply with the regulations in Turkey and must not be subject to special procedures.
Required Permissions and Documents for Import
There are many important details that anyone who wants to perform import operations should pay attention to. Among these details are the clearances and documents required for import. Completing these documents fully is of utmost importance when carrying out import operations. In this article, I will try to explain which documents those who want to carry out import operations in Turkey need and where they can obtain these documents.
• Import Regime Document (IRB): This document is used to determine which category the products to be imported fall into. Those who want to import must obtain this document.
• Invoice: An invoice document showing the sales prices of the products to be imported is needed. The invoice is also used as a document proving the agreement of the parties.
• Certificate of Origin: This is a document showing from which country the products to be imported originate. This document is used at customs during the importation of products.
• Analysis Reports: Analysis reports showing the quality of the products to be imported are used in customs inspections.
• Bill of Lading (Transport Document): This is a document showing how the products to be imported will be transported and which shipping company they will be sent with.
• Insurance Policy: An insurance policy for the products to be imported is also required. This policy ensures that eventual damages are covered in case the products are damaged or lost at customs.
When performing import operations, in addition to the documents listed above, some additional documents may also be requested. Preparing all of these documents fully is of utmost importance for the smooth completion of the processes.
As for obtaining documents, there are many institutions and organizations in Turkey where you can obtain these documents. You can easily handle those related to the field of logistics and transportation, including customs clearance, through Navlungo.
How to Import?
1. Determination of the Product to be Imported
As a first step, you need to determine the product you want to import. You need to research whether this product is sold in the country, how much its price is, the cost of import, and whether the product complies with the legislation in Turkey.
2. Preparation of Documents to be Used in Import Operations
To bring the product you want to import into Turkey, the necessary documents must be prepared. Among these documents are the Import Regime Document (IRB), Certificate of Origin, Invoice, Transport Document, and Insurance Policy. You need to prepare these documents in accordance with current legislation.
3. Customs Duty Calculation
To calculate the customs duty rates of the product you want to import, you need to review the Turkish Customs Tariff Schedule. Customs duty rates may vary depending on factors such as the type, quantity, and origin of the product.
4. Customs Procedures
The most important step in import transactions is customs clearance. During customs clearance, the customs declaration of the products and the necessary documents are presented to customs officers. Customs officers check whether the customs duty of the products has been paid, whether there is any situation that would prevent the entry of the products into the country, and the compliance of the products with the legislation.
If you have shortcomings in matters such as logistics and customs, you can easily handle all your logistics processes with Navlungo. We can manage all your processes for you.
5. Payment and Delivery
After customs procedures are completed, importers can take delivery of the products by making payment. Payment is usually made through a bank. Delivery is carried out through shipping companies or courier companies.
If you need a business partner to run the process together from start to finish, you can contact Navlungo. Our experienced team will support you from the beginning to the end of the process and carry out all logistics processes.
What are the Types and Scope of Import?
The types and scopes of import are quite wide. Here, we can explain the different types and scopes of import simply as follows:
• Commercial Import: Commercial import is when a country purchases goods and services from other countries to use in commercial activities. The purpose of this type of import is to offer consumers a wider range of products and to lower production costs. For example, Turkey imports many products such as petroleum, natural gas, automobiles, electronics, and food from all over the world.
• Industrial Import: Industrial import is bringing raw materials or intermediate goods used in the production process from abroad. Industrial import lowers production costs and provides a competitive advantage to domestic producers. Turkey has a high rate of industrial imports, especially in the textile, chemical, metal, food, and electronics sectors.
• Tourism Import: Tourism import is when tourists come to a country and spend money. This type of import is important for businesses operating in the tourism sector. Turkey is among the prominent countries in the world in tourism imports.
• Cultural Import: Cultural import is when a country adopts the culture of other countries or adapts cultural elements from other countries into its own culture. This type of import increases cultural exchange between countries and promotes understanding and respect between cultures.
• Services Import: Services import is when a country purchases services from other countries. For example, a country may purchase services such as education, healthcare, finance, tourism, and consulting from abroad. Turkey has a high rate of services imports, especially in the finance, health, and tourism sectors.
How is Import Logistics Provided?
In import logistics, Navlungo is a logistics company that manages its customers' import operations. It manages the transportation modes, customs procedures, storage, and insurance of its customers' goods.
It offers maritime, air, and land transportation options and prepares the customs declarations of its customers' goods, pays customs duties, and runs the customs clearance procedures of the goods.
Additionally, it ensures that its customers' goods are stored and insured safely and correctly. Navlungo facilitates and correctly manages its customers' import operations.
What are Goods Subject to Import Bans and Restrictions?
Import operations in Turkey are carried out in accordance with laws and restrictions determined by the government. While the import of some products is banned, other products are subject to import restrictions. Here are some product groups whose import is banned or subject to restrictions in Turkey:
• Prohibited Import Products: Products banned for import in Turkey include various weapons and ammunitions, explosives, narcotics and stimulants, certain products used for medical purposes, hazardous waste and garbage, products based on child labor, among others. The importation of these products is strictly prohibited, and severe penalties can be applied to importers.
• Restricted Import Products: Products subject to import restrictions in Turkey include various agricultural products, food products, industrial products, and electronic products. Specific certificates, permits, or taxes are required for the import of these products. For example, the importation of tobacco and alcohol products is restricted and requires special permits. Similarly, the importation of automobiles is also restricted, and certain taxes must be paid for their import.
• Limited Import Products: Products whose import is limited in Turkey include various textile products, electronic products, shoes, household goods, furniture, toys, and similar items. Certain quotas have been determined for the import of these products, and import can be made within these quotas.
What are Goods Subject to Import License?
Import operations in Turkey are carried out in accordance with laws and restrictions determined by the government. During import operations, special permits are required for the import of certain products. These products are called "goods subject to import license". Having detailed information about goods subject to import license is extremely important for companies and individual importers carrying out import operations. Some products subject to import license in Turkey are as follows:
• Agricultural Products: In Turkey, agricultural products require special licenses to meet specific health standards. In this context, licenses obtained from the Ministry of Health are required in addition to various documents for the import of agricultural products. Agricultural products subject to import license include animal products, fruits, and vegetables.
• Industrial Products: Iron, steel, copper, and aluminum products, chemical products, textile, and leather products are included as subject to license. For the import of these products, the approval of the relevant Ministries is required, along with an Operating License, Industrial Registry Certificate, Preliminary License, and similar documents.
• Electronic Products: An Import License or similar documents are required for the import of radio and television receivers, wireless communication devices, computers, tablets, and smartphones.
• Other Products: Other products subject to import license include medical supplies, products subject to customs duties, and raw materials. For the import of these products, approval from the relevant Ministries, payment of customs duties, and other documents are required.
What are Import Taxes?
Import taxes in Turkey are determined according to the Customs Tariff Schedule. Import taxes vary depending on the type of product and the country from which it is imported. Below is a table showing the most commonly applied import taxes in Turkey:
Tax TypeTax RateCustoms DutyVariable (Varies according to the type of product and the country from which it is imported)VAT (Value Added Tax)18%SCT (Special Consumption Tax)Variable (Applied to alcohol, tobacco, luxury vehicles, and certain consumer products)
As can be seen from the table above, the most commonly applied types of import taxes in Turkey are Customs Duty, VAT, and SCT. Customs Duty is a tax applied to imported products so they can compete against similar products in Turkey.
VAT is a tax applied at a rate of 18% over the sale price of the imported product in Turkey. SCT, on the other hand, is a special tax applied to the import of certain products and is valid for alcohol, tobacco, luxury vehicles, and some consumer products.
How to Calculate Import Taxes?
Although calculating import taxes seems like a very complex process, it can actually be easily calculated by following a few simple steps.
First, you need to find the code of the imported product in the Customs Tariff Schedule. After finding this code, you need to check the rates opposite the relevant product in the Tariff Schedule to learn the Customs Duty rate.
To calculate the Customs Duty rate, we use the CIF (Cost, Insurance, Freight) value of the imported product. The CIF value represents the sum of all costs added to the sales price of the product.
Next, to calculate the VAT rate, we must apply the 18% rate on the CIF value.
SCT rates may vary according to the type and value of the imported product. To learn the SCT rates, you also need to look at the Customs Tariff Schedule.
As a result, to calculate import taxes, you must determine the product's code in the Customs Tariff Schedule, its CIF value, and the Customs Duty, VAT, and SCT rates. Doing this process correctly will help you both fulfill your tax obligations and avoid unnecessary payments.
Advantages and Disadvantages of Import
As in any business, importing has positive and negative aspects. In the table below, you can see the advantages and disadvantages of importing:
AdvantagesDisadvantagesGoods and services of manufacturers in different countries may be cheaperThe competitiveness of domestic producers may decreaseForeign trade volume increases, the economy growsUnemployment may increase with the bankruptcy of domestic producersOffers a wider range of products to domestic consumersThere may be risks created by political and economic disputes with foreign countriesIt can be ensured that domestic producers follow technological developments and thereby increase their competitivenessDependence on foreign sources may increase and the domestic economy may be adversely affectedProvides foreign currency inflow to the importing countryDomestic consumers' dependence on imported products may increase
Trade Defense Instruments in Imports (Trade Policy Defense Instruments-TPDI)
Measures known as Trade Policy Defense Instruments (TPDI) are used to reduce the impact of imports on domestic producers. These instruments are also frequently used in Turkey. So, what is TPDI and which methods are used?
TPDI is a set of trade policy instruments that countries take to protect their own economic interests. Among these, there are different methods such as anti-dumping measures, countervailing duties, import quotas, and customs duties.
• Anti-dumping measures: Countries can apply anti-dumping measures in case foreign producers sell their products at lower prices than domestic products. These measures aim to bring the prices of foreign producers' products into line with those of domestic producers by increasing them.
• Countervailing duties: In some cases, some costs included in the products of foreign producers may be costs that domestic producers do not encounter when producing the same products. In this case, countervailing duties can be applied, eliminating the cost advantage of foreign producers.
• Import quotas: An import quota is a measure that limits the import of a specific product from foreign producers. This measure can enable domestic producers to have a better position in the market.
• Customs duties: Customs duties aim to bring the prices of imported products into line with those of domestic producers by bringing an extra tax burden on them.
Although Trade Policy Defense Instruments are used to protect domestic producers, their excessive use can be to the detriment of foreign producers, as well as having negative effects on consumers. Therefore, determining the right policies and using TPDI appropriately is extremely important.
Current Turkey Import Graph
This table shows Turkey's import amounts between the years 2012-2022, in billion dollars. These data provide an idea of how Turkey's imports have changed over time.
YearImport Amount (billion $)2012236.42013251.92014242.22015198.52016198.92017234.22018223.72019223.62020199.32021253.82022278.2
What is a Quota in Import?
A quota in import is the limitation of a specific product entering the country throughout the year to a certain amount. The application of quotas in imports in Turkey can be determined by the Ministry of Agriculture and Forestry or the Ministry of Trade and can generally be aimed at sectors such as agricultural products, animal products, and textiles. The quota can be applied for purposes such as protecting the country's imports, supporting local producers, or preventing foreign currency outflow.
What is Free of Charge Import?
Free of charge import is a term used in trade between countries and refers to a transaction that allows the importer to import a specific product without paying a fee. Free of charge imports in Turkey can only be carried out by public institutions or private sector companies that meet specific conditions. Free of charge imports are generally used for the import of goods needed for areas such as education, healthcare, research, and similar fields, and usually provide exemption from taxes and duties.
