Importing cars and car parts

If you are looking to import a car, van, lorry, or coach, there is a lot of red tape to consider. For example, license plate registration, taxes such as the BPM tax, product requirements and product liability. It is easier to import vehicles and parts from EU countries than it is from non-EU countries. If you import car parts, you do not have to deal with BPM tax or license plate registration, but you will have to meet product requirements and observe product liability rules.

If you import a car from the US or another non-EU country, you will have to pay import duties, while car imports from Germany and other EU countries are not subject to import duties. Import duty rates are the same for new and used cars and car parts.

Importing cars

When you import a car, you register it in your name or your company’s name by registering the license plate number with RDW, the Netherlands Vehicle Authority. You will also have to pay the Dutch BPM tax on passenger cars and motorbikes.

License plate registration

Before your imported vehicle is considered road-legal, it has to be registered in your name or your company’s name. To do so, simply follow this handy roadmap and register your vehicle with RDW. If you are going to use the car yourself, register it in your own name or your company’s name. If you want to sell the cars as a dealer, include the vehicles in your company stock (in Dutch). You will receive the license plate number on a vehicle registration card.

BPM tax

In the Netherlands, you pay Private vehicle and motorcycle tax (bpm). For passenger cars, you pay BPM when you enter them in the vehicle registration register. For vans, you pay BPM after registration in name (tenaamstelling). The BPM rate varies from one vehicle to the next. Trucks are not subject to BPM, and there is a special BPM exemption scheme for vans.

Calculating BPM

BPM rates (in Dutch) vary per vehicle. For passenger cars, you pay BPM based on the car’s carbon emissions. For delivery vans the BPM rate is a percentage of the net list price. New fully-electric vehicles are not subject to BPM.

BPM exemption for delivery vans

Business owners are exempt from BPM on their delivery vans under the Business Owner Scheme (in  Dutch). You must drive at least 10% of kilometres in the vehicle for business use. If you resell your van to another business owner, you can use the transfer facility (in Dutch).

Motor vehicle tax

You have to pay motor vehicle tax (MRB) to drive vehicles on Dutch roads. There are special rates (in Dutch) for trucks. Lorries with a maximum gross weight of 12,000 kilogrammes and intended for goods transport are also subject to heavy motor vehicle tax (BZM).

Importing car parts

Imported car parts do not have to be entered into the motor vehicle register. They are also not subject to BPM tax. Product requirements and product liability rules do apply, just as they would for cars and other vehicles.

Product requirements

Vehicles have to comply with European Vehicle Regulations, as do vehicle parts. The RDW inspects vehicles. Vehicles and parts must be E-marked in accordance with the EU Automotive Directive. In some cases, vehicles or vehicle parts must also have CE marking in addition to E marking. For example, for a crane truck, the undercarriage must have E marking. And the crane mechanism falls under the Machinery Directive and needs CE marking.

New type

Do you bring vehicles and parts (components) onto the European market for the first time? Then you need a European type approval certificate. In the Netherlands, you can apply for a type approval certificate via RDW. After approval, you can sell the new vehicle or part in the Netherlands or other EU member states.

For a full list of the rules for vehicles and vehicle parts, consult the Vehicle Regulations (in Dutch).

Product liability

Sometimes you may be liable for (personal injury) damages if you import vehicles or their parts. This comes into play when importing from countries outside the European Economic Area (EEA). The cause of the damage must be a defect in these products.

Legally, you are considered the manufacturer. So, you need to make sure that the imported vehicles or vehicle parts are fully compliant with all requirements and regulations. Does an EEA manufacturer make these products under its own brand name (private label) or unbranded (white label)? Even then you are liable as an importer.

Recall

Are your imported vehicle or parts not compliant? And was this product broken more often with risk of physical injury? Then, as an importer, you must recall all vehicles and repair the defect. Furthermore, you must inform the RDW and the consumer about the defect.

Importing goods from EU countries

There is free movement of goods in the EU. That means that if you import a car or car parts from Germany or any other member state, you do not have to pay import duties. You do not have to declare the goods to customs either. If you buy a car or car part with your business, your supplier will usually charge 0% VAT, provided that you pass on your VAT identification number. Calculate (in Dutch) Dutch VAT (21%) on the purchase and report it in your VAT return. You will usually be allowed to deduct it as input tax in the same return. Imports from other EU member states are called Intra-Community Acquisitions (ICAs). Buying a new or almost new vehicle (in Dutch) from a business in the EU, is an ICA. Buying a new vehicle from a private seller in another EU country is a different story. In that case, request an invoice without VAT, as you will need the invoice for your business records.

Importing goods from non-EU countries

If you import goods from non-EU countries such as the US, you have to declare the imported goods to Dutch Customs. Your carrier or customs broker (in Dutch) will usually take care of this on your behalf for a fee. They usually also advance the import duties and VAT that may be due. If you have a business that imports vehicles or parts, you will need an EORI number, a mandatory identification number for anyone dealing with Customs.

Import duties

You will have to pay import duties when you import cars or car parts from a non-EU country. The amount depends on the commodity code (also known as HS code or TARIC code). Customs uses these codes to classify goods. Finding the right commodity code can be difficult. Different types of vehicles have different codes. When importing vehicles or vehicle parts, you will usually have to deal with a 10-digit commodity code. Below are the first four digits for each vehicle type:

• Passenger cars: 8703 (automobiles and other motor vehicles primarily designed for passenger transport).
• Vans and lorries: 8704 (automobiles for transporting goods).
• Coaches: 8702 (automobiles for transporting ten or more persons, including the driver).
• Car parts: 8708 (parts and accessories of motor vehicles referred to in codes 8701 to 8705).

The complete list of HS codes can be found on the website of the World Customs Organization. The import duty rate for vehicles is usually 10%, regardless of whether you import new or used cars. The import duty rate on new and used car parts is usually 4.5%. Import duties are based on the customs value of a particular product: the purchase price plus shipping and any insurance costs up to the border (or port) of entry into the EU.

Import duty relief

In some cases, you qualify for import duty relief. For example when you import new or used vehicles or parts made in countries with which the EU has a trade agreement. Such as Morocco and Mexico. To qualify, the products have to be of preferential origin from the treaty country. You can demonstrate this with preferential documents of origin that you requested from your supplier.

Check the HS code to find out if you qualify for tariff preference (reduced import duties) based on the commodity code and production country. If there is a reduction, you can tell by the word 'rate preference' (tariefpreferentie). You can also call the Customs Information Line for more information, 0800 0143.

The EU has a customs union with Turkey. If you have an ATR certificate from Turkey, you do not have to pay import duties on vehicles and vehicle parts.

Many imported vehicle parts come from China and the USA, neither of which have a trade agreement with the EU. As a result, you cannot benefit from lower import duties and will have to pay the full amount when importing cars or parts.

VAT when importing non-EU goods

When you import products into the Netherlands, you pay Dutch import VAT (21%). You are allowed to deduct this VAT as input tax in your VAT return, provided that you are entitled to deduct VAT. Do you regularly import goods from non-EU countries? You can apply for an article 23 permit from the Dutch Tax Administration. Then you avoid having to pay for VAT at the time of import. Instead, you can report the import VAT in your regular VAT return.

Parallel imports

Parallel importation means importing goods without the consent of the trademark owner. Some forms of parallel importation are allowed (authorised parallel imports). Others are not (unauthorised parallel imports).

Example of unauthorised parallel importation

You want to import Ford car parts from a non-EEA country on a large scale. Ford already has an official importer for these car parts and the brand name has been registered in the EEA. Are you allowed to import these parts? No, you are only allowed to do so with the manufacturer’s permission. Or with the permission of another brand owner.

Example of authorised parallel importation

Are you importing branded products from EEA countries? If an official manufacturer or importer already sells them within the EEA, so may you.

Counterfeit goods

Rogue traders make money from counterfeit (fake) goods. The tire industry alone lost over €2 billion due to counterfeit car tires and €179 million due to counterfeit car batteries from 2010 to 2015. Counterfeit products are often inferior to the original. They may even result in injury or death. If this were to happen, the importer would be liable. Importing and trading counterfeit goods is prohibited and punishable by law.

Preventing counterfeit goods

It can be very difficult to recognise if a product is real or fake. A very low price is usually a sign that the product is fake. If the price appears too good to be true, it usually is. It will always be tricky to figure out whether a supplier is as reliable as they seem. Try to limit risks wherever you can.

Working out the cost price

You should include the costs of importing cars and car parts when calculating your cost price. Costs to consider include:

• purchasing costs, such as the value of the car or car parts
• transport (shipping) and insurance costs
• import duties and handling charges
• BPM tax
• storage costs
• repair and maintenance costs
• administration costs, such as the fee you pay your accountant
• personnel costs

Sales price

When selling the car or car parts, you also include advertising and advertising costs. You further add to these costs your profit margin. Then you have your selling price. VAT is not an expense because you deduct it if you are entitled to it as an entrepreneur.

Motor vehicle tax

Do you have one or more vehicles for business use ? For example, a passenger car, delivery van, motorbike, coach, or lorry? Then you have to pay motor vehicle tax (road tax). If you use vans for your business you may qualify for a reduced road tax rate. In the Netherlands, these vehicles are known as ‘vehicles with a gray license plate’.

Need more information?

• BOVAG (in Dutch) is a trade association for vehicle manufacturers, wholesalers, and importers. They also serve as a quality mark for customers of these companies.
• The Inspectorate for the Environment and Transport (ILT, in Dutch) checks whether companies, organisations, and government agencies comply with laws and regulations on sustainability and physical safety.
• The Royal RAI Association represents the interests of manufacturers and importers of passenger cars and trucks, trailers, and semi-trailers, bodyworks and special vehicles, motorcycles and scooters, mopeds, and bicycles. Vehicle part and garage equipment suppliers can also join the RAI Association.