Companies that bring goods on to the Russian market often face complex import procedures. A proper distribution model for the Russian market is therefore essential. For example, the Russian ‘green channel’ procedure provides opportunities for companies that bring goods on to the Russian market. Deloitte-specialists of the Russia Desk know these opportunities.
Many trading companies subcontract the Russian import procedures to independent Russian distributors. Since the Russian custom agency sharpened its customs formalities, this distribution model has a number of important disadvantages. Trading companies often don’t know how the independent Russian distributor deals with the customs formalities. The companies therefore run a risk that their products are possibly imported ‘grey’ and inadequate payments are made to the Russian revenue authorities for customs duties and VAT. With ‘grey’ import, trading companies can become fully liable for the revenue duties that should have been paid by the independent distributor even if they are not actively involved in the importation procedure.
Sharpened custom formalities
The Russian custom agency challenges ‘grey’ imports with sharpened import formalities. This may lead to unexpected discussions on the custom value of goods, time-consuming information requests and substantial delays at the Russian border. This all with a true risk on higher costs and import levies.
It is therefore necessary or at least advisable to consider how your trading company can make these risks manageable. You can choose for full control and take the import procedures in own hands. Filing a request for application of a Russian ‘green channel’ procedure is then an attractive additional opportunity. A lot of formalities can be agreed with the Russian custom agency in advance. For some product categories simplified procedures are available. If you want to use such possibilities in Russia, there are certain conditions to be met. Possibly the existing distribution model should be amended accordingly. Our specialists of the Russia Desk know how to help. They can assist you in searching for a suitable distribution model and setting up a tax friendly import structure.