LOGISTICS & CUSTOMS CONSIDERATIONS IN TURKEY. How to use Turkey as a Gateway for Your Products Getting your Products into Turkey- Tariff Issues
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1 LOGISTICS & CUSTOMS CONSIDERATIONS IN TURKEY How to use Turkey as a Gateway for Your Products Getting your Products into Turkey- Tariff Issues Presented by Ercan Korkut, BILIN Global Logistics, , iadvisory Event, Singapore
2 1. Turkey is at geographically an ideal location In the proximity of emerging markets where foreign trade has been growing Links Asia to Europe, Russia to Africa with rail freight, air freight and maritime corridors MARMARAY Project (USD 5 Billion) will provide the non-stop transport of goods via railway from China to London. Potential to be a logistics hub for more than USD 2 Trillion freight
3 TURKEY CAN BE A GATEWAY FOR SIN GAPORE TO THE MARKETS OF EAST EUROPE, CEN TRAL ASIA, N ORTH AFRICA, MIDDLE EAST BECAUSE 2. Turkey has ambitious targets for 2023 to be one of the top 10 global economies Foreign Trade will hit USD 1.1 trillion, in which USD 500 billion will be exports Today s logistics market value of $80-100Billion to reach $500Billion Very good Logistics performance index by World Bank analysis (pls, see next page) More than 40 logistics villages to be established with strong infrastructure The length of highways to be increased from 2250km to 7500km The length of Fast Train Railway to be increased from 900km to 9000km Airport passenger capacity to be increased from 165Million to 400 Million Container handling capacity from 8 Million TEU to 32 Million TEU* *TEU: 20 container=34cbm
4 Timeliness Logistics Performance Index ( LPI) 4,45 3,95 3,45 2,95 2,45 1,95 Argentina Russia 2,9 Source: The World Bank China Turkey Brazil India Thailand Germany South Africa Qatar 3,4 3,9 4,4 Infrastructure Note: 1-very low, 5- very high Size of the bubble indicates the total score received from the LPI index (LPI) measures the logistic "friendliness" of 155 countries in six categories; 1. The efficiency of the clearance process with border control agencies and customs, 2. Infrastructure quality of trade and transport, 3. Level of competitive pricing for shipments 4. The quality and expertise of logistics services; 5. How well the consignments are tracked and traced; 6. Punctuality of the expected delivery dates Turkey moved up from 39th place in 2010 to 27th in 2012, among 155 countries Turkey performed better than 3 out of 4 BRIC countries - Brazil, Russia and India and also, most of the countries in Eastern Europe and the Middle East & Africa.
5 TURKEY CAN BE A GATEWAY FOR SIN GAPORE TO THE MARKETS OF EAST EUROPE, CEN TRAL ASIA, N ORTH AFRICA, MIDDLE EAST BECAUSE 3. Customs infrastructure & legislations allow all types of foreign trade transactions Turkey entered Customs Union with EU in 1996 Continuous liberalizing import regulations to get and retain foreign investment Turkey customs are compliant to do all world wide trade transactions 1 Authorized Economic Operator (AEO) 3, Single window application 4 & E-customs allow for easy customs procedures Limited tariff barriers (pls, see next page) 1 Free Circulation Procedure, Transit Procedure, Bonded WH ing Procedure, Inward Processing Procedure, Outward Processing Procedure, Processing under Customs Control Procedure and Temporary Import Procedure, ATA Carnet procedure 2 LSP: Logistics Service Provider 3 An international status enabling authorized LSPs to handle customs w/o paperwork at their own premises 4 One stop solution to apply and trace online customs procedures
6 LIMITED TARIFF BARRIERS Source: The Benchmark Turkey tool has been designed for the Invest in Turkey users to compare Turkey with other countries in various categories. The charts in this section are generated based on the data obtained from the IMD World Competitiveness Yearbook 2013, the World Trade Indicators 2009 database, and the World Bank Doing Business 2013 report. The Investment Support and Promotion Agency of Turkey shall not be held responsible for the accuracy of the data.
7 THE EASIEST WAY TO START USIN G TURKEY AS A GATEWAY As a trading company until you become confident on the market, you can still trade Without incorporating a legal entity in Turkey -> NO TAX LIABILITY Only costs are; Bonded WH storage (VAT Free) and customs broker service fee Only risk is the return cost for unsold goods HOW? Obtain a potential tax number (brings no tax liability) Sign a contract with a Bonded Warehouse Operator Assign a Customs Broker with a power of attorney Bring your goods to Bonded Warehouse The goods will stay under your ownership until you sell them You may transit the goods to any 3 rd country with rich transportation alternatives You may sell it into Turkey upon receipt of firm customer orders (direct sales mode) You may return the goods back to the origin or anywhere else anytime as you wish
8 GETTIN G YOUR PRODUCTS IN TO TURKEY- TARIFF OF TURKEY Tariff information is given on 12 digit HS Code (Harmonized System Code) basis Tariff of Turkey mainly comprises the followings; Tax rates applicable at import Customs tax rates (Singapore is classified under Other Countries ) Value added Tax rates (1%, 8%, 18%) Special Consumption tax rates (Petroleum, automobiles, tocacco, alcoholic beverages, luxury products) Tariff preferences Other Tax measures Anti dumping taxes Countervailing charges Import surveillance Additional funds/duties for fish and fishery products, processed agricultural products, sugar and flour content Import Formalities Documents, licenses, certificates, mandatory standards Import prohibitions and restrictions Quantitative limits,
9 GETTIN G YOUR PRODUCTS IN TO TURKEY- TARIFF OF TURKEY Documentation at importation: 1. Invoice of the goods 2. Packaging and Weight List 3. Shipping License 4. Certificate of Origin 5. ATR or EUR.1 Certificate of Circulation or Form A 6. CMR or Bill of Lading or Airway Bill depending on the transportation mode 7. Insurance Policy 8. Documents depending on type of goods a. Health Certificate b. Test Reports c. Technical Documents d. Letter of Clearance e. CE documents
10 For your individual inquiries, We will be happy to help you! Please, contact Other Sources 1. Republic of Turkey Prime Ministry, Investment Support and Promotion Agency; invest.gov.tr 2. Office of the Commercial Counseller, Turkish Embassy Singapore
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