If the goods are declared on an import entry for further manufacture but, at the time of import, have no known customer and are for further sale, the entry is incorrect even if the goods are intended for eventual sale to an LMA.
This is because the goods at the time of import are ‘for sale’ and not ‘for manufacture’, meaning any duty-free classification for manufacture cannot be applied and import duty must be paid.
Goods pre-sold prior to import or imported to fulfil orders or pre-sales can still be imported duty free as these goods, at time of import, are considered for manufacture.
Storage and movement requirements
Goods imported for further manufacture remain subject to the control of Customs because they are not removed for home consumption, but this does not mean they have to be stored in a Customs Controlled Area (CCA).
Note that CCA’s are not licensed to store goods until required by the importer but the movement of the goods must meet the requirements of S85 and/or S235 of the Customs and Excise Act 2018.
Importers of goods for further manufacture should apply to Service Delivery for a NZCS 201 ‘Customs Permit for removal of goods from a Customs Controlled Area (single permission)’ to facilitate the movement of the goods from the wharf to their secure storage area.
NOTE: Restrictions, including an expiry date of the permit, will be applied to ensure the goods are further manufactured and not stored indefinitely.
Diverted product contravenes duty-free status
Ethyl Alcohol imported to be sold to ethyl alcohol permit holders (NZCS 241 & NZCS 242) can only be imported using a valid NZCS 243 ‘Permit to import alcohol duty free for approved purposes’.
Several importers of duty-free ethyl alcohol for manufacture who, at the time of import, did not to hold a NZCS 243 have been found to be diverting some of the ethyl alcohol for sale to permit holders where it is to be used for approved purposes other than the manufacture of a potable beverage.
Ethyl Alcohol cannot be imported as duty-free for further manufacture and later diverted to NZCS 241 or NZCS 242 permit holders. This is not for manufacture and technically is dutiable. Such activity will be subject to enforcement action, including collection of duty, when detected.
NOTE: A new NZCS 243 permit is required for every individual import shipment. Previous permits which provided for a total amount imported over several shipments within a set timeframe are no longer being issued.
Further information and guidance is available on the Customs website at: Duty-free alcohol permits