Chapter 14: How to Start Your Business Importing from China to Nigeria
The process of importing might seem tough, but the truth is that it is straightforward.
You need to go through this process before you start the importation business.
This chapter takes you through the process of starting your importation business.
1. Start by registering your company
The first step that you need to take is to register your company name and the physical address of your location. The Nigerian government will issue you with a Certificate of Incorporation.
You will also have to register with the Federal Inland Revenue Services.
Here, you must have a valid Tax Identification Number (TIN) and a proof that you have been remitting your taxes.
Also, you need to have a valid email linked to your TIN as well as your mobile number.
If you fail to register your TIN, you will not be able to submit any documents from the Nigerian central bank in the future.
As such, you won’t be able to submit any export declarations to the Nigerian Customs Services.
At this point, you can select a commercial bank of your choice to do transactions during your shipping process.
2. Acquire regulatory and a Trade insurance Certificate
You cannot do your export business without having a Trade Insurance certificate.
The importance of this certificate is to minimize the loss you may incur in case of accident to your cargo during shipment.
This includes piracy and loss of your cargo due to natural calamities such as the sinking of the ship.
You, therefore, need to check with a reputable insurance company in Nigeria to obtain this certificate.
Also, if you are importing goods that require regulatory certificates such as permits and conformity documents, make sure you have them.
These documents will come in handy especially during customs clearance.
Such goods include foodstuff, electronics, automotive and construction materials.
Check with the authorities on which regulatory documents you need.
3. Register for the Trade Portal
Now you are ready to register as an importer in Nigeria which will allow you to use the Nigeria Single Window Trade Portal.
You can locate this portal on the FIRS website.
You will need the Nigeria Single Window Trade portal to facilitate your shipping business.
It allows the parties involved in the shipping process to access the necessary information.
You can access trade information, follow up on your transactions and gain access to customer care for any clarification.
You will need to have a valid email address, a telephone number and the details of your company for you to register to this portal.
Once you submit this information to FIRS, you can register as a user using your Tax Identification Number and your email.
You will obtain a password that you can log into the portal.
4. Fill Out and Submit e-Form “M”
This step involves you logging into the Nigeria Single Trade Window portal and filling the form to a commercial bank of your choice.
The importance of this document is that it keeps track of the goods that you are importing to Nigeria.
It also helps when it comes to paying the necessary import duties.
You will need to have the following documents at hand before you log in to the Single Trade Window:
- Your password and username for the portal
- Your Tax Identification Number
- Any regulatory documents required by the customs.
- Scanned copies of necessary documents. You need to mark VALID FOR FOREX explicitly” or “NOT VALID FOR FOREX,” depending on the document.
- The Commercial Invoice
- The insurance certificate
Once you log in to the portal, you will locate the form on the left side on the “CBN Form Services” drop list.
You need to fill appropriately seven of the forms on the section.
These forms include Header, Names & Parties, Transport, Financial, Goods, Attachments, and Endorsement.
The attachment page will require you to submit the Commercial Invoice which needs to be valid for three months.
Also, you need to provide the insurance certificate and any permits and regulatory certificate necessary.
Once you are through, you need to submit the original copies of the following to your preferred commercial bank:
- Commercial Invoice
- Insurance certificate
- All necessary permits and regulatory certificates.
Once you get your completed E- form M, your commercial bank will:
- Confirm that you have properly filled your E- form M
- Confirm that you have attached all documents properly
- Verify the authenticity of the submitted documents.
- Approve your E- form M and mail it to the Nigeria Customs Service.
- Confirm the registration of the E- form M.
You can check the update of the process through the mail you provided.
You need to note that your E- form M is valid once the Nigeria Customs service registers it.
With the Single Trade Window portal, it is easier to track if your form has been accepted or rejected and the reasons therein.
- Nigeria Customs Service processing
Once the Nigeria Customs Service accepts your E- form M, it will start processing your form.
This includes creating a Pre- Arrival Assessment Report within 12 hours.
If you are importing general merchandise, the E- form M will be valid for three months, but you can seek an extension of three months from your commercial bank.
In case you are importing capital goods, the validity of the E- form M is 365 days with a room for another 365 days extension.
If you need a further extension, you will have to seek permission from the Director of Trade and Exchange office.
You can locate this office at the Central Bank of Nigeria.
This is the step where you need to prepare all the necessary documents that you will need for the importation process. What happens here is that you will have to ensure proper filling of the documents.
For instance, ensure that your supplier indicates properly in an understanding language the description of the goods on the Commercial Invoice.
Also, you need to ensure that all the documents that you are transacting in are genuine.
Also, before handing over these documents to the bank, ensure that you have followed all the import procedure.
To ensure smooth clearance of your cargo, ensure that your supplier submits all documents to the bank on time.
You can instruct your supplier to make arrangements for the delivery of your cargo once the Nigeria Customs Service records your E- form M
- Follow up on your supplier ad your commercial bank.
There are some tasks that your supplier and the commercial bank that you will transact business through the need to do.
Your supplier, for instance, is responsible for the preparation of your cargo.
This includes testing, inspection, and certification of the cargo through the Standards organization of Nigeria.
Your cargo must pass through this stage to get the Standard Organization of Nigeria Conformity Assessment Program (SONCAP) certificate.
Most imports to Nigeria need this certificate for customs clearance at the ports.
Also, your supplier must submit four copies of the following documents to his commercial bank:
- Transport document, e. Airway bill, bill of Lading
- Packing list
- Commercial Invoice
- Certificate of Origin
Your supplier commercial bank will then forward these documents to your commercial bank to prepare for a Letter of Credit.
On the other hand, your commercial bank has some functions to perform.
Once they receive the documents from the supplier commercial bank, they will assess and endorse the documents.
After endorsement, they will upload the documents to the Pre- Arrival Assessment Report System.
Once complete, they will issue you with a Pre- Arrival Assessment report.
Your commercial bank must counter check on the documents to ensure that they are genuine.
They will also alert you once they receive all the documents within 21 days of shipping your cargo.
Once the SONCAP issues you with the certificate for your goods, goods, you can go ahead and import your cargo.
Remember to activate the SONCAP certificate on the Single Trade window portal and Apply for the Pre- Arrival Assessment Report.
You will have to clear with the customs at the port of entry before your goods can be allowed in Nigeria.
This includes inspection as well as paying the required customs duties and taxes.
The customs will calculate the duties and taxes based on the value of your imports, i.e. the CIF value.
The commercial bank you are transacting through is responsible for collecting the necessary import duty on your cargo
It is easier if your commercial bank is a designated one.
However, if your commercial bank is not a designated bank, you need to pay the amount to a designated bank and send a copy of the receipt to your commercial bank.
The designated bank ensures that you have paid the full tax and sends a notification to The Nigeria Customs Service if the amount is correct.
It will after that submit the amount you have paid to the Central Bank of Nigeria.
Central Bank of Nigeria
The Nigeria Customs Service will only release the documents to you have completed all the transactions.
You are then free to collect and transport your cargo.
I hope that this guide has cleared all the fears you may be having concerning importing your cargo from China to Nigeria.
You have seen how easy it is to do your shipping.
This guide illustrates the importance of having a reliable forwarder for your shipping.
Not only will they facilitate your shipping but also keep you informed during the entire shipping process.
For a reliable forwarder, get in touch with us today and let us introduce you to a new world of shipping.