American firms register relatively few trade complaints against Dutch firms. The Dutch tendency to support a level playing field in trade matters and their depth of experience in trade positions them as the genuine "neutral" traders of Europe.
American companies locating in the Netherlands, however, will come up against a complex business culture, in which companies, trade unions, government bodies and industry associations engage in constant and close consultations. This stems, in part, from the traditional Dutch emphasis on achieving consensus and avoiding conflict in this small and densely populated country.
There is also a trend, particularly in larger government procurements, to "buy European" if not Dutch. The Dutch consider themselves to be good Europeans and, from a practical point of view, they see political advantages in buying European, especially when all else is relatively equal in a bid competition. In this regard, local representation is essential for American companies hoping to win major government contracts. A joint venture with a Dutch or European partner will improve the U.S. company's competitive position. Companies looking to compete on Dutch Government procurements should contact the U.S. Commercial Service at the Embassy early on in the process for guidance and possible advocacy, particularly if there are political or "level playing field" issues which might arise.
Offsets for defense contracts: All foreign contractors must provide at least 100 percent offset/compensation for defense procurement over $2.5 million. The seller must arrange for the purchase of Dutch goods or permit the Netherlands to domestically produce components or subsystems of the system it is buying. This does not apply to Joint Strike Fighter as it is a cooperative program in which the Netherlands is a development partner.
Parallel Imports: Branded products originally brought onto the market outside of the European Union may not be imported into the Netherlands without the explicit written permission of the brand owner.
Technical standardization within the European Union may amount to a non-tariff trade barrier in certain circumstances, specifically, when new standards benefit EU suppliers to the detriment of non-EU suppliers. On the other hand, Mutual Recognition Agreements (MRAs) recently negotiated between the United States and the European Union could save U.S. manufacturers up to ten percent of the cost of delivering U.S. exports to Europe. The MRA's cover telecommunications equipment, information technology products, medical devices, pharmaceuticals and sporting goods. In the long term, standardization increases access to EU markets.
Import Requirements and Documentation
Value-added tax, most frequently called by its acronym VAT, is charged on the sale of goods and services within the country. Unlike the customs duty, which is the same for all EU member countries, the VAT is established by the tax authorities of each country and differs from country to country. At each stage of the manufacturing and distribution chain, the seller adds the appropriate amount of VAT (tax on the amount of value that the seller added to the product, plus the amount of VAT passed on to the seller by the supplier) to the sales price. The tax is always quoted separately on the invoice. The firm periodically subtracts the VAT paid on its purchases of goods and services from the VAT collected on sales and remits the balance to the Government. This process repeats itself at each stage until the product is sold to the final consumer, who bears the full burden of the tax. Below is a summary of the Dutch VAT rates.
• Zero rate applies to exports.
• Six percent rate applies to necessities such as food, medicines, and transportation.
• 19 percent is the general or standard rate and applies to most goods.
For imports into the Netherlands, the VAT is levied at the same rate as for domestic products or transactions. The base on which the VAT is charged on imports is the C.I.F. value at the port of entry, plus any duty, excise taxes, levies, or other charges (excluding the VAT) collected by customs at the time of importation. This total represents the transaction value of the import when it clears customs.
The importer is liable for payment of customs duties, VAT, and any other charges at the time of clearing the goods through customs. Exports from the Netherlands are exempt from VAT since they are not consumed in the country, but will be subject to any tax imposed in the country of destination. Temporary imports that will be re-exported are 2/23/2009 not subject to the VAT. The importer may have to post a temporary bond for the amount of customs duty and taxes as security that will be canceled when the goods are taken out of the country.
The European Union is seeking to harmonize the range of VAT rates among the 15 EU member nations. The EU Council has adopted guidelines for converging the VAT rates over an extended transitional period, such as seeking to establish a minimum VAT rate for most products, lifting border tax controls, and defining which products will be allowed an exempted or zero VAT rate. Each country will still retain the collection and enforcement authority that currently exists.
Excise taxes are levied on a small number of products such as soft drinks, wine, beer, spirits, tobacco, sugar, and petroleum products. For imports, the excise tax is paid by the importer and is in addition to any customs duty or VAT. The European Union is close to harmonizing excise taxes.
Only a small number of goods of U.S. origin require import licenses, mostly agricultural and food items. Other items subject to import licensing requirements include coal and lignite fuel, some specified base metal products, various apparel and textile products, and controlled items such as arms and munitions. Licenses are generally rapidly granted for goods of U.S. origin.
Licenses are not transferable. They may be used to cover several shipments within the total quantity authorized. In general, the Harmonized System classification number and the corresponding wording of the tariff position indicate the goods covered by the license. Imports of certain commodities, including numerous foodstuffs, are subject to special regulations regarding and must be labeled to show manufacturer, composition, content (in metric units), and country of origin. In view of the complexity of these regulations and changing requirements, information should be requested from the importer prior to shipment. When the services of an importer are not available, information can be obtained directly from the appropriate Dutch authority listed at the end of this publication.
Shipments to the Netherlands require one copy each of the bill of lading (or air waybill) and the commercial invoice for customs clearance. There are no consular requirements, but certificates of origin may be required as set out below. U.S. Customs also requires two copies of the U.S. Shipper's Export Declaration (U.S. Department of Commerce Form 7525V) for goods valued at $1,500 or more. A declaration form must be completed for all shipments by regular mail or parcel post valued at $500 or more. The form must include the harmonized commodity number of the exported product as well as the weight stated in metric units. When sending goods through the mail, the exporter should inquire at the post office as to the proper documentation needed for mail shipments.
Although no special format is prescribed for the commercial invoice, it is advisable to include the following: date and place of shipment; name (firm's name) and address of the seller and buyer; method of shipment; number, markings of the packages, and their numerical order; description of the goods using the usual commercial description according to kind, quality, grade, and the weight (gross and net, in metric units), along with any factors increasing or decreasing the value; agreed price of goods; unit cost; total cost f.o.b. factory plus shipping; insurance charges; delivery and payment terms; and the signature of a responsible official of the shipper's firm. Bills of lading should bear the name of the party to be notified. The consignee needs the original bill of lading to take possession of the goods.
Certificates of origin are required for a small number of goods such as textile products. The need for a certificate of origin should be ascertained directly from the importer or from the appropriate customs authority. Letter-of-credit terms may stipulate that a certificate of origin be provided. Customs authorities accept certificates of origin issued by authorized local U.S. chambers of commerce or boards of trade.
The Integrated Tariff of the Community, referred to as TARIC (acronym for "Tarif Intégré de la Communauté"), is designed to show various rules applying to specific products being imported into the customs territory of the EU or, in some cases, when exported from it. To determine if a license is required for a particular product, check the TARIC.
The TARIC can be searched by country of origin, Harmonized System (HS) Code, and product description on the interactive website of the Directorate-General for Taxation and the Customs Union. The TARIC is updated annually.
It is important to note that the World Customs Organization has released the third update in more than 20 years to the HS Code. There are major production classification revisions to chapters 84 and 85. This affects not just the EU, but all 121 contracting parties to the HS starting January 2007.
In addition, many EU Member States maintain their own list of goods subject to import licensing. For example, Germany's "Import List" (Einfuhrliste) includes goods for which licenses are required, their code numbers, any applicable restrictions, and the agency that will issue the relevant license. The Import List also indicates whether the license is required under German or EU law. For information relevant to Member State import licenses, please consult the relevant Member State Country Commercial Guide.
The official model for written declarations to customs under "Normal Procedure" is the Single Administrative Document (SAD). European Free Trade Association (EFTA) countries including Norway, Iceland, Switzerland, and Liechtenstein also use the SAD. However, other forms may be used for this purpose. Information on import/export forms is contained in Title VII, of Council Regulation (EEC) No. 2454/93, which lays down provisions for the implementation of Council Regulation (EEC) No. 2913/92 establishing the Community Customs Code (Articles 205 through 221). Articles 222 through 224 provide for computerized customs declarations and Articles 225 through 229 provide for oral declarations.
Goods brought into the customs territory of the Community are, from the time of their entry, subject to customs supervision until customs formalities are completed.
Goods presented to customs are covered by a summary declaration, which is lodged once the goods have been presented to customs. The customs authorities may, however, allow a period for lodging the declaration, which cannot be extended beyond the first working day following the day on which the goods are presented to customs. The summary declaration can be made on a form corresponding to the model prescribed by the customs authorities. However, the customs authorities may permit the use, as a summary declaration, of any commercial or official document that contains the particulars necessary for identification of the goods. It is encouraged that the summary declaration be made in computerized form.
The summary declaration is to be lodged by:
• the person who brought the goods into the customs territory of the Community or by any person who assumes responsibility for carriage of the goods following such entry; or
• the person in whose name the person referred to above acted.
Non-EU goods presented to customs must be assigned a customs-approved treatment or use authorized for such non-Community goods. Where goods are covered by a summary declaration, the formalities for them to be assigned a customs-approved treatment or use must be carried out:
• 45 days from the date on which the summary declaration is lodged in the case of goods carried by sea;
• 20 days from the date on which the summary declaration is lodged in the case of goods carried other than by sea.
Where circumstances so warrant, the customs authorities may set a shorter period or authorize an extension of the period.
New EU battery rules came into force on 26 September 2006 following the publication of the Directive on batteries and accumulators and waste batteries and accumulators (Directive 2006/66) in the EU's Official Journal. This new Directive replaces the original Battery Directive of 1991 (Directive 91/157). The new Directive applies to all batteries and accumulators put on the EU market including automotive, industrial and portable batteries. It aims to protect the environment by restricting the sale of batteries and accumulators that contain mercury or cadmium (with an exemption for emergency and alarm systems, medical equipment and cordless power tools) and by promoting a high level of collection and recycling. It places the responsibility on producers to finance the costs associated with the collection, treatment, and recycling of used batteries and accumulators. The Directive also includes provisions on the labeling of batteries and their removability from equipment. EU Member States must implement the EU Directive into their national law by September 26, 2008.