Does customs bureaucracy affect the importation of chemicals?

by | 17/10/2018

6 minutes to read

The bureaucracy is one of the factors that most contributes to the customs barrier in foreign trade processes.

Along with it, the Brazilian industries and commerce, still suffer with difficulties like high taxes and delay in inspections and inspections.

In a survey by CNI (National Confederation of Industry) with 693 industrial companies of various sizes, 83% said they had difficulty in exporting, 79% could not increase sales volume due to import and export difficulties, whose process payment expenses to $ 2,200 per container versus $ 1,000 of payment average in OECD (Organization for Economic Cooperation and Development) countries.

In the process of buying chemicals, this scenario is even more difficult, since the delay in the release of the product can be crucial for the quality and useful life of the material.

The purpose of this post is to explain how customs bureaucracy can hinder the purchase of chemicals from abroad and what could be done to minimize this problem. Check it out!

 

Bureaucratic factors of movement of chemical loads

Among the difficulties that companies encounter in export and import processes, we can highlight:.

. High costs – customs and customs fees, make the process more expensive;

. Delay in the release of goods – which takes an average of 13 days in Brazil, where up to 26 different documents are required in the maritime modal process and 15 in terrestrial transport. The response of the customs agencies is a factor that justifies this low agility, mainly due to the delay in inspections;

. Inefficient infrastructure and logistics system – a bottleneck in all Brazilian logistics processes, problems encountered in roads, ports and airports are factors that make any commercial operation difficult;

. the inherent risk of chemicals – the classification of these products as hazardous already require specific regulations for each mode of transport, as well as imputing joint liability between shipper and transporter, regarding their treatment, such as special packaging, quantity limitations, and specific schedules for manipulation;

. Exchange rate – with exchange variation, import becomes more expensive for Brazilians, despite benefiting exporters who can offer merchandise at more competitive prices;

. Export financing – a large part of the Brazilian business sector, are unaware of the official credit lines that could aid in import and export processes.

 

The bureaucracy in buying chemicals

The National Agency of Sanitary Surveillance (Anvisa) and the Federal Revenue Service (RFB) are the main agencies that operate the bureaucratic obstacles to the purchase of chemical products in Brazil.

The difficulties in the liberation of these products delay the scientific research carried out by several institutions, and with this, the scientific development of Brazil, whose internationalization of research is hampered by legal barriers, including the acquisition of stem cells and items such as mice for analysis, cellular tissues and laboratory kits.

According to Anvisa, the purchase of chemicals and the importation of other materials used in research have a maximum period of 24 hours for release, and this does not happen when identification information and material classification are incorrect. The RFB states that the average period of release of such type of merchandise is also 1 day.

However, it is not what scientists and companies say, by using chemicals in research and production processes, which ensure that the processes take an average of 6 months.

 

Impacts of the economy customs bureaucracy

The delay in scientific research and the high costs in the purchase of chemical products besides increasing the added value of the products hinder the competitiveness of companies and scientists in the foreign market.

Several scientists move to other countries to maintain continuity in the scientific career, in search of bigger budgets and the debureaucratization of research processes.

These changes translate into delay of Brazil in relation to the other countries: only in Latin America, we are behind Peru, Argentina, Chile and Colombia.

There may also be a loss of pioneering discovery of new drug applications and innovations in the process of industrialization of materials: if the idea is good, and there is a delay in procuring inputs that justify research or production, other international teams may anticipate the discovery.

Another recurring problem and consequence of the bureaucratic process is the illegality that occurs at all stages of the acquisition of inputs, which even reduces customs collection.

All of these factors have a direct impact on the economy of the country: the non-collection of taxes and customs duties in the short term and the decline of long-term industrial and scientific development.

 

Actions that minimize bureaucracy

Bureaucracy in the purchase of chemicals can be reduced if stakeholders use control resources with process automation and can hire customs brokers to clear the goods.

SECEX is responsible for the implementation of the “single window” concept, which places SISCOMEX in the same web portal as all the consenting bodies, facilitating the process of exports and imports.

Among the governmental actions that aim to reduce bureaucracy in this process, we have: the approval of PEC 290, which adds provisions in the Constitution that update the treatment of science, technology and innovation activities and the Differentiated Regime of Contracting (RDC), which promotes agility in purchasing of equipment and materials aimed at science.

Bill 4,411 / 12, creates a registration and an acquisition quota for the researchers and bill 2.177 that defines the National Code of Science, Technology and Innovation, which, more comprehensive, provides the exemption from import taxes, facilitates access to biodiversity in biological research and makes Bidding Law more flexible.

Despite the bureaucracy for the purchase of chemical products, according to O Estado de São Paulo newspaper and information provided by the Brazilian Chemical Industry Association (Abiquim), the trade balance of chemical products last year showed an increase in imports of 6.4 % in relation to 2016. In volume, purchases in foreign trade hit a record high of 21.2%, moving a total of 20.8 million tons in the first half of 2017. These figures already indicate an improvement in the process of this kind of product, and consequently, in those inherent problems.

Did you like this subject? Would you like to know how to reduce your logistics costs in the process of inventory management and contribute to the development of the country’s commercial and industrial sectors? You can also read this post and know the best practices in automation of logistics processes.

 

ORBIT Logistics is one of the world’s leading suppliers of inventory management solutions (VMI – Vendor Managed Inventory and SCM) and real-time data acquisition.

Our company, founded in 2003, provides a modular system for supply chain management and automation, serving global customers from offices in Leverkusen (Germany), Atlanta (USA), Sao Paulo (Brazil) and Shanghai (China). A highly qualified team of more than 40 engineers and technicians offers customized turnkey solutions for process management and monitoring.

For more information:

ORBIT LogisticsBrasil
www.orbitlog.com.br
dante@orbitlog.com.br

Phone: (55 11) 3796-1755 / 1756
Cellphone.: (55 11) 96420-1701

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