Import Procedures Guide: Pakistan
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IMPORT PROCEDURES GUIDE Pakistan
Table of Contents 1.1. Ease of Doing Business .......................................................................................................................................................................................................... 6 1.2. Business Environment ........................................................................................................................................................................................................... 6 1.3. Working Hours ........................................................................................................................................................................................................................ 7 1.4. Entry requirements in Pakistan for KSA nationals .......................................................................................................................................................... 7 1.5. Key contacts in Pakistan for KSA nationals ...................................................................................................................................................................... 7 1.6. Financial Environment .......................................................................................................................................................................................................... 8 1.7. Legal Environment.................................................................................................................................................................................................................. 8 2.
Rules of Origin......................................................................................................................................................................................................................... 9
2.1 Rules of Origin between Pakistan & KSA .......................................................................................................................................................................... 9 2.1.1 Non-Preferential Rules of Origin – Pakistan ................................................................................................................................................................... 9 3.
Trade Barriers ....................................................................................................................................................................................................................... 10
3.1 Trade Barriers in Pakistan .................................................................................................................................................................................................. 10 3.1.1 Tariff Barriers ........................................................................................................................................................................................................................ 10 3.1.1.1Basic Customs Duty ........................................................................................................................................................................................................... 10 3.1.1.2Regulatory Import Duty .................................................................................................................................................................................................... 11 3.1.1.3Goods and Services Tax (GST) / Sales Tax / Value Added Tax (VAT) ..................................................................................................................... 11 3.1.1.4Special Federal Excise Tax ................................................................................................................................................................................................ 11 3.1.1.5Excise Tax ............................................................................................................................................................................................................................. 12 3.1.1.6Countervailing Duty........................................................................................................................................................................................................... 12 3.1.1.7Anti-dumping Duty ............................................................................................................................................................................................................ 12 3.1.1.8Safeguard Duty ................................................................................................................................................................................................................... 12 3.1.2 Non-tariff barriers................................................................................................................................................................................................................ 13 3.1.2.1Import Prohibitions, Restrictions, and Licensing......................................................................................................................................................... 13 3.1.2.2Standards .............................................................................................................................................................................................................................. 13 3.1.2.3Certification and Conformity Assessment .................................................................................................................................................................... 14 3.1.2.4Accreditation........................................................................................................................................................................................................................ 14 3.1.2.5Labelling................................................................................................................................................................................................................................ 14 3.1.2.6Sanitary and Phytosanitary (SPS) Requirements ........................................................................................................................................................ 15 4.
Trade Remedies.................................................................................................................................................................................................................... 15
4.1 Trade Remedies by Pakistan: Impact on Saudi exporters .......................................................................................................................................... 15 4.1.1 Anti-Dumping Measures ................................................................................................................................................................................................... 15 4.1.1.1Tackling Anti-dumping measures in Pakistan.............................................................................................................................................................. 16 4.1.2 Countervailing Measures................................................................................................................................................................................................... 16 4.1.2.1Tackling Countervailing measures in Pakistan ............................................................................................................................................................ 16 4.1.3 Safeguard Measures............................................................................................................................................................................................................ 17
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4.1.3.1Tackling Safeguard measures in Pakistan ..................................................................................................................................................................... 17 5.
Key Ports in Pakistan........................................................................................................................................................................................................... 17
5.1 Key Sea Ports in Pakistan ................................................................................................................................................................................................... 17 5.2 Key Airports in Pakistan ..................................................................................................................................................................................................... 19 5.3 Accessing Key Inland Markets in Pakistan..................................................................................................................................................................... 19 5.3.1 Inland Container Depots (Dry Ports) .............................................................................................................................................................................. 19 5.3.2 Services provided at Inland Container Depots (ICDs) ................................................................................................................................................ 20 5.3.3 Key Inland Markets and Transportation Methods....................................................................................................................................................... 20 5.4 Shipping Lines used in Pakistan ....................................................................................................................................................................................... 21 5.4.1 Major Shipping Lines and Lead Time from KSA to Pakistan ..................................................................................................................................... 21 5.4.2 Rates of Key Routes between KSA and Pakistan.......................................................................................................................................................... 21 5.4.3 Major Air transport lead time and costs from KSA to Pakistan ................................................................................................................................ 22 6.
Key Logistics Facilities ........................................................................................................................................................................................................ 23
6.1 Storage facilities / services provided at the ports in Pakistan ................................................................................................................................... 23 6.1.1 Bonded Warehouses ........................................................................................................................................................................................................... 23 7.
Overall Import Process: Pakistan ..................................................................................................................................................................................... 23
7.1 Overall Import Process via Sea Port ................................................................................................................................................................................ 23 7.2. Customs Clearance Process............................................................................................................................................................................................... 25 7.3 Lead Time and Cost of Overall Import Process............................................................................................................................................................. 27 8.
Key Import Documents ...................................................................................................................................................................................................... 27
8.1 Summary table of key import documents ..................................................................................................................................................................... 27 8.1.1 Mandatory Documents ...................................................................................................................................................................................................... 27 8.1.2 Additional Documents ....................................................................................................................................................................................................... 28 8.2 Documents Overview......................................................................................................................................................................................................... 29 8.2.1 Bill of Lading ......................................................................................................................................................................................................................... 29 8.2.2 Commercial Invoice ............................................................................................................................................................................................................ 29 8.2.3 Packing List............................................................................................................................................................................................................................ 30 8.2.4 Certificate of Origin ............................................................................................................................................................................................................. 30 8.2.5 Letter of Credit ...................................................................................................................................................................................................................... 31 8.2.6 Insurance Certificate ........................................................................................................................................................................................................... 31 8.2.7 Import Goods Declaration (IGD)...................................................................................................................................................................................... 32 8.2.8 Import Permit........................................................................................................................................................................................................................ 32 8.2.9 Health Certificate ................................................................................................................................................................................................................. 32 8.2.10 Phytosanitary Certificate ................................................................................................................................................................................................... 33 8.2.11 Halal Slaughtering Certificate / Halal Certificate ......................................................................................................................................................... 33 9.
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Key Government Agencies involved in Import ............................................................................................................................................................. 34
9.1 Key government agencies involved in the import of all types of products ............................................................................................................ 34 9.2 Key Government Agencies involved in the import of Specific Types of Products................................................................................................ 35 10. Key Standard Agencies and their Approval Process .................................................................................................................................................... 36 10.1 Standard Agencies according to Industry....................................................................................................................................................................... 36 10.2 Pakistan Standards and Quality Control Authority (PSQCA).................................................................................................................................... 36 10.2.1 Process for Acquiring the Certification Mark License Scheme ................................................................................................................................. 37 10.2.2 Costs involved ...................................................................................................................................................................................................................... 39 10.2.3 Lead Time .............................................................................................................................................................................................................................. 39 10.3 Ministry of National Food Security and Research ....................................................................................................................................................... 39 10.3.1 Customs Clearance Process for Imported Food at the Port ....................................................................................................................................... 39 10.3.2 Lead Time .............................................................................................................................................................................................................................. 41 10.4 Drug Regulatory Authority of Pakistan (DRAP) ........................................................................................................................................................... 41 10.4.1 Pharmaceutical Products Registration Process ............................................................................................................................................................ 41 10.4.2 Key Documents required for pharmaceutical products registration ...................................................................................................................... 43 11. Packaging and Labelling Regulations –Pakistan ......................................................................................................................................................... 43 11.1 Food Industry........................................................................................................................................................................................................................ 43 11.1.1 Food Industry Regulator .................................................................................................................................................................................................... 43 11.1.2 Labelling Requirements ..................................................................................................................................................................................................... 43 11.2 Pharmaceuticals Industry .................................................................................................................................................................................................. 44 11.2.1 Pharmaceuticals Industry Regulator ............................................................................................................................................................................... 44 11.2.2 Laws and Regulations......................................................................................................................................................................................................... 44 11.2.3 Labelling Requirements ..................................................................................................................................................................................................... 44 12. References ............................................................................................................................................................................................................................. 45
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Disclaimer
Saudi Export Development Authority “SAUDI EXPORTS” had prepared the Import Guide as a part of its continuous publication on countries. The purpose of this guide is to provide a high-level view of the country imports process, procedures, documentation requirements, stakeholders…etc., based on available public information. Its analysis, perceptions, and anticipations are subject to personal judgment. “SAUDI EXPORTS” is not liable for any consequences caused by the understanding and interpretation of any part of this guide. In general, the information in the report present a broad view of the imports environment of this country. Saudi exporters are encouraged to carry out further studies to be updated and more informed on the import process, procedures, and documentation requirements identified in this report.
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1. Business Environment Overview1 1.1. Ease of Doing Business2 Pakistan has been ranked 144th in the world on the ease of doing business by Doing Business, World Bank. The ranking is based on certain key parameters that have been elucidated in Table 1 below: Table 1: Ease of Doing Business Topics Starting a Business Dealing with Construction Permits Getting Electricity Registering Property Getting Credit Protecting Minority Investors Paying Taxes Trading Across Borders Enforcing Contracts Resolving Insolvency
Doing Business Rank (2017) 141 150 170 169 82 27 156 172 157 85
1.2. Business Environment The cultural differences among people and companies might pose several challenges for Saudi exporters in conducting cross border business. For ease of doing business, Saudi exporters must not only understand but also strategize to accommodate significant culture differences between KSA and Pakistan. English and Urdu are the two official languages of communication in Pakistan, although English is the official language to conduct business in Pakistan. The business culture in Pakistan is heavily based on the establishment of familiarity and trust and it will be worthwhile for Saudi exporters to be introduced to a potential trading partner through a mutual reliable contact. Face to face meetings must be scheduled via e-mail three to four weeks in advance. It is advisable to reconfirm the meeting shortly before the scheduled date, as it is common for business appointments to be rescheduled at short notice. Pakistanis expect business associates to be punctual for their business meeting although it is normal for them to arrive a little late. The dress code for corporate meetings is business attire.
1 2
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Doing Business Guides UK Doing Business, World Bank 2017
The standard way of greetings in business meetings is a handshake accompanied by a smile. Business cards are usually exchanged during business meetings. Potential partners are to be addressed by their forename and surname, until asked to do so otherwise. The decision making process in Pakistan is often slow and Saudi exporters are advised to not rush negotiations.
1.3. Working Hours3 Working hours in Pakistan are different from KSA. Different businesses operate between varied dates and times, as mentioned below in Table 2 . Saudi Exports advises the exporter to recheck with the business partner prior to scheduling business travel. Table 2: Working Hours - Pakistan Working Days
Working Hours
Monday to Friday
9 am – 5:30 pm
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Government offices are open from 8 am to 3 pm Monday to Thursday and from 8:00 AM to 12:30 pm on Friday and from 8:00 – 2:00 on Saturday
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Private banks in Pakistan operate from Monday to Thursday from 9 am to 5 pm and reduced hours on Friday and Saturday
1.4. Entry requirements in Pakistan for KSA nationals4 Saudi exporters who intend to visit their trading partners in Pakistan are required to obtain a visa prior to their travels. For more details on the checklist of visa documents, costs, and application forms, Saudi exporters are advised to visit the link provided below: https://pakistan.travisa.com/Common/TVSVisaInstructions.aspx?citizenshipid=sa&countryid=pk&residenceid=us&partneri d=ta&glid=aus&travelertypeid=BU
1.5. Key contacts in Pakistan for KSA nationals The Embassy of the Kingdom of Saudi Arabia is the first point of contact for Saudi exporters and is located in Islamabad in Pakistan. Working hours of the embassy are from 9 A.M. to 4 P.M. The embassy provides assistance and guidance for Saudi nationals in Pakistan and can also be contacted in the event of any issues faced by a Saudi exporter. For more information, Saudi exporters are requested to kindly visit the link provided below: http://embassies.mofa.gov.sa/sites/pakistan/EN/Pages/default.aspx Saudi exporters can also fill in the form provided in the link below for any enquiries: 3 4
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Santander Trade Pakistan Travisa
http://embassies.mofa.gov.sa/sites/pakistan/EN/ContactDiplomaticMission/Pages/ContactWithDiplomaticMission.aspx
1.6. Financial Environment5 The State Bank of Pakistan is responsible for the regulation and supervision of domestic and foreign banks operating in Pakistan. Currently, there are 41 scheduled banks, 6 development finance institutions (DFIs), and 2 micro finance banks (MFBs) operational in the country. Saudi exporters are requested to kindly visit the link provided below for more information about banks in Pakistan: http://www.sbp.org.pk/ecib/members.htm All imports into Pakistan generally require a compulsory Letter of Credit (L/C). Kindly note that revolving, transferable, and packing letters of credit are not accepted in Pakistan. Payment to the beneficiary of the L /C can be made either in the country of origin or country of shipment of goods. Alternative methods of payment are to be clarified with the State Bank of Pakistan.
1.7. Legal Environment6 Contracts for commercial operations can be drafted in English or Urdu in Pakistan. The Supreme Court of Pakistan is the highest judicial body in the country. The Pakistan judiciary consists of two classes of courts: The superior judiciary: Supreme Court of Pakistan, Federal Shariat Court and five High courts (one High Court for each province, and a High Court for the Islamabad Capital Territory) The lower judiciary: District and Sessions Courts, Judicial Magistrates ‘Court, Special Tribunals and Boards Any commercial disputes or transactions between two parties are first contested at the lower judiciary and then moved to higher judiciaries in the event of further appeals and complaints. Saudi exporters are requested to kindly visit the link provided below for more information about practicing law firms and lawyers in Pakistan: http://www.globaltrade.net/Pakistan/Legal/expert-service-provider.html As of 2017, Pakistan is ranked 157 for enforcing contracts by Doing Business, World Bank. It takes up to 1, 096 days and 18.1% of the claim amount (e.g. it would cost SAR 18, 100 for a claim amount of SAR 100,000) for resolving a commercial dispute through court in Pakistan. 7 In Pakistan, arbitration procedures are followed according to the laws and regulations provided under the Arbitration Act 1940 and the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act 2011.
US Exports Country Commercial Guide Supreme Court of Pakistan 7 Doing Business, World Bank 2017 5 6
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2. Rules of Origin 2.1 Rules of Origin between Pakistan & KSA8 Rules of origin refers to the specific provisions applied by a country to determine the origin of goods for the purpose of international trade. These are usually based on international agreements or national legislation. Pakistan applies preferential and non-preferential rules of origin to determine the nationality of the imported goods. KSA and Pakistan (including other GCC countries) do not currently have in place a bilateral trade agreement and as such, non-preferential rules of origin are applied to KSA imports into Pakistan. Note: However, Pakistan plans to implement a bilateral agreement with Gulf Co-operation Council titled; Pakistan-Gulf Cooperation Council Free Trade Agreement (Pakistan-GCC FTA).9 The date for the agreement’s ratification is yet unknown. 2.1.1 Non-Preferential Rules of Origin – Pakistan Pakistan applies non-preferential rules of origin for goods imported from Saudi Arabia; the criteria applied to determine origin of non-preferential goods has been set out in the General Agreement on Tariffs and Trade (GATT) Rules of Origin. 1. In Pakistan, two major criteria determine the country of origin of products, namely: a. The “wholly-produced” principle: A product is considered “wholly- produced” within a country if it originates from there and if all the materials used in producing the product are sourced from within the nation. The goods that are considered to be wholly produced/ obtained from an exporting country are: i. Agricultural products yielded from the country; ii. Animals which are born and raised in the country; iii. Products that are obtained from the live animals in the country; iv. Products that are obtained by hunting or fishing conducted in the country; v. Products that are obtained from the sea and from rivers and lakes within the country by a vessel of that country; vi. Products produced on ships from the items notified in (v). vii. Mineral products obtained from the soil or seabed. viii. Scrap and waste that results from the manufacturing operations within the country; ix. Goods that are produced within the country exclusively or mainly from one or both of the following: x. Products referred to in sub-paragraphs (i) to (ix) above;
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Islamabad Chamber of Commerce and Industry Asia Regional Integration Centre
b. Principle of “substantial transformation”: Goods that undergo transformation into a new and different product with a distinctive name are subject to the principle of substantial transformation. Goods can be considered as substantially transformed if it fulfills the following rules: i. Value-added rule ii. Change in tariff classification iii. The special processing rule, the minimum transformation required for a good to be classified as of national origin 2. Documentation must be submitted to Customs as evidence of imported goods origin. 3. Certificate of Origin authorizes the origin of imported product and fulfills the document requirements as specified in the bilateral trade agreement. 4. Saudi Exporters can obtain the Certificate of Origin from the Ministry of Commerce and Investment, Saudi Arabia. To obtain the application and for more information on the procedure to obtain the Certificate of Origin, Saudi exporters can visit the link provided below: https://mci.gov.sa/en/Agencies/IndustrialAffairs/a8/Documents/Application%20of%20Origin%20Certificate%20(Ge neral%20Form).pdf
3. Trade Barriers 3.1 Trade Barriers in Pakistan10 Nations trading with each other usually face trade barriers; these include tariff and non-tariff barriers. The trade barriers relevant to Saudi exporters are detailed in the sections below: 3.1.1 Tariff Barriers 3.1.1.1 Basic Customs Duty11 • The Basic Customs Duty is a tariff imposed on goods that are transported across international borders. • As previously mentioned in Section 1.1, in the current absence of a bi-lateral trade agreement between Pakistan and KSA, who are both members of the World Trade Organization (WTO), Most-Favored Nation (MFN) tariffs will apply to Saudi imports into Pakistan. • Customs Duties are calculated on the basis of the Cost, Insurance, and Freight (c.i.f.) value of the imported goods on an ad valorem basis. • The MFN tariff rate in Pakistan, as per Pakistan Customs Tariff (PCT), currently averages at 14.3%; this rate may increase or decrease depending on the type of imports. For instance, certain goods such as: raw materials, machinery, 10 11
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US Exports-Country Commercial Guide Pakistan Trade Policy Review 2015, WTO
essential foodstuffs, food commodities, and pharmaceutical products are generally non-dutiable or subject to lower tariffs. • Additionally, as a median, the tariffs increase from 7.8% on first-stage processed products, 10.9% on semi-finished goods, and 17.6% on fully processed products. • Saudi exporters are requested to kindly visit the link provided below for more information on product-specific tariff rates: http://download1.fbr.gov.pk/Docs/201610251510131910Tarrif-Chaper1To99-2016-17.pdf 3.1.1.2 Regulatory Import Duty12 • The Federal Board of Revenue (FBR) levies Regulatory Import Duty (RD) on 565 items – the rates range from 5% 15%. • Some of the goods on which RD are charged include mobile phones, telecom equipment. • Saudi exporters are requested to kindly visit the link provided below for more information: http://www.pkrevenue.com/customs/regulatory-duty-ranging-5-15-percent-imposedincreased-on-565-importeditems/ 3.1.1.3 Goods and Services Tax (GST) / Sales Tax / Value Added Tax (VAT)13 • Under the Sales Tax Act 1990, the government of Pakistan levies Sales Tax / VAT on most goods and services in Pakistan (locally produced / imported). • VAT is generally levied at an average of 17% of value of supplies.14 • Goods such as computer software, poultry feeds, and medicines, are exempt from VAT. • Saudi exporters are requested to kindly visit the link provided below for more information on the complete list of goods that are exempt from Sales Tax / VAT http://files.tron.pk/6th.pdf 3.1.1.4 Special Federal Excise Tax15 • The federal government of Pakistan also levies a Special Federal Excise Tax of 1% on all goods and services produced domestically or imported. • Certain goods such as food products, tractors, certain vehicles, and vehicle assembly kits are exempt from being subject to Special Federal Excise Tax. • Saudi exporters are requested to kindly visit the link provided below for more information on the goods and services exempt from Special Federal Excise Tax. Pakistan Revenue Federal Board of Revenue Government of Pakistan 14 Pakistan Trade Policy Review 2015, WTO 15 Pakistan Trade Policy Review 2015, WTO 12 13
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http://download1.fbr.gov.pk/sros/FederalExciseSROs/2007/2007sro655.pdf 3.1.1.5 Excise Tax16 • Excise duty is an indirect tax charged on the import of certain goods into Pakistan that are deemed to be non-essential, and harmful to public health and environment. Some of the goods subject to Excise Tax include tobacco and petroleum products. • For more information, Saudi exporters can visit the link provided below: http://www.fbr.gov.pk/SROs/Federal%20Excise/1 3.1.1.6 Countervailing Duty17 • Certain goods imported into Pakistan benefit from the application of subsidies in the way of foreign governmental financial assistance (for instance: tax incentives, loans at preferential rates, grants). If these provisions cause damage or injure the local production of similar goods, countervailing investigations can be initiated. • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting investigations into allegations of countervailing and subsequent injury to the domestic industry. • The Appellate Tribunal hears appeals against any countervailing decisions and these can also be further appealed at the High Court and Supreme Court. • Further information is provided in Section 4.1.1of this guide. 3.1.1.7 Anti-dumping Duty • Anti-dumping duties are imposed when goods are imported into Pakistan at prices lower than the market values in the country of export and this causes injury / harm to domestic Pakistani producers of likes or competitive goods • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting investigations into allegations of dumping and subsequent injury to the domestic industry. • Further information is provided in Section 4.1.1 of this guide 3.1.1.8 Safeguard Duty18 • Safeguard Duties are implemented as an emergency measure when the increase in imports of certain goods affects the domestic industry producing similar goods in Pakistan. • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting safeguard investigations. • Further information is provided in Section 4.1.1 of this guide.
Pakistan Trade Policy Review 2015, WTO Pakistan Trade Policy Review 2015, WTO 18 Pakistan Trade Policy Review 2015, WTO 16 17
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3.1.2 Non-tariff barriers 3.1.2.1 Import Prohibitions, Restrictions, and Licensing19 • Imports of certain products are prohibited and / restricted for health and safety, security, moral and environmental reasons. • Goods subject to import prohibitions and restrictions are notified in Appendices A and B respectively of the Import Policy Order issued by the federal government. • Examples of prohibited imports include hazardous chemicals, and retreaded tires. Saudi exporters are requested to kindly visit the link provided below (Pg 11) for more information on the complete list of prohibited items. http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf • Items that are restricted for import are allowed entry into Pakistan upon furnishing evidence of fulfillment of all associated requirements (prior approval or clearance from relevant regulatory agencies and compliance with national standards) • Import restrictions apply to food and food items, pharmaceuticals and building materials to name a few. Saudi exporters are requested to kindly copy paste the link provided below (Pgs 18 and 132) in the web browser for more information on the complete list of restricted items and associated conditions: http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf 3.1.2.2 Standards20 • The standard setting process in Pakistan is governed by the Pakistan Standards and Quality Control Authority (PQSCA), established in 1996, under the purview of the Ministry of Science and Technology. • The PSQCA adopts and develops national standards, in collaboration with one of its 11 national entities and relevant technical committees. • It is a member of the following international organizations: o International Organization for Standardization o International Electrochemical Commission o International Organization of Legal Metrology (OIML) •
PSQCA has adopted 22,070 ISO standards and developed 8,857 national standards. It is the National Enquiry Point (NEP) for the WTO Agreement on Technical Barriers to Trade (TBT).
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Standards in Pakistan are both voluntary and mandatory; goods subject to mandatory standards require product certification prior to entry into the local market for consumption.
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Saudi exporters are requested to kindly visit the link provided below for more information about PQSCA:
Karachi Customs Agents Association Pakistan Standards and Quality Control Authority
http://www.psqca.com.pk/psqca.html 3.1.2.3 Certification and Conformity Assessment21 • PQSCA has deemed 109 products as “mandatory products” or products that should adhere to Pakistan standards at the import stage. Examples of these products include fruit juices, food for infants, and cement-related products. These have been notified in the Import Policy Order of 2016; Saudi exporters are requested to kindly copy paste the link provided below in the web browser for the entire list: http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf (Pg 135) • These mandatory products are to be registered under the Compulsory Certification Mark License Scheme of Pakistan at the import stage. Additionally, exporters of these products have to be registered with the PSQCA to ensure compliance. • The Quality Control Center (QCC) of PSQCA offers multifunctional testing laboratories and services for conformity assessment of these products. • More information regarding this is provided in Section 10 of this guide. 3.1.2.4 Accreditation •
The Pakistan National Accreditation Council (PNAC) operates under the administrative control of the Ministry of Science and Technology and is the national accreditation body for testing laboratories and other conformity assessment facilities
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Further, PNAC is a signatory to voluntary accreditation agreements such as the International Accreditation Forum (IAF), and the Asia-Pacific Laboratory Accreditation Cooperation (APLAC).
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As such, Saudi exporters who are required to obtain conformity assessment certificates prior to the export of certain regulated goods into Pakistan (as mentioned in Section 3.1.2.1) can obtain the same from national testing and calibration laboratories accredited by the IAF.
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For more information regarding national accredited conformity assessment bodies and testing facilities, kindly visit the link provided below: http://pnac.org.pk/
3.1.2.5 Labelling22 •
Pakistan does not have a uniform labelling regulatory framework in place.
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Labelling requirements of certain industries or sectors are governed by the relevant state agency. For instance, the Ministry of Agriculture sets requirements for the labelling of pesticides and edible products.
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More information can be found in Section11 of this guide
Pakistan Standards and Quality Control Authority Pakistan Trade Policy Review 2015, WTO
3.1.2.6 Sanitary and Phytosanitary (SPS) Requirements23 •
Sanitary and phytosanitary requirements have to be met prior to importing plants and plant products, animals and animal products, and food into Pakistan.
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The National Animal and Plant Health Inspection Services (NAPHIS), under the Ministry of National Food Security and Research, is the proposed notification authority and enquiry point under the WTO- SPS Agreement. Note: NAPHIS has not been legally ratified yet and its legal ratification has been on hold since 2012
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Currently, the Department of Customs, Plant Protection and Quarantine (PPQ), and the Department of Animal Quarantine (DAQ) are responsible for overseeing the import of food and food products into Pakistan.
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Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information on agencies governing food safety and security in Pakistan: https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf (Table 3.5)
4. Trade Remedies 4.1 Trade Remedies by Pakistan: Impact on Saudi exporters24 Trade remedies are tools that facilitate the government of Pakistan to take remedial action against exports causing material injury to the domestic industry. The below mentioned trade remedies can be imposed upon Saudi exporters under such conditions. 4.1.1 Anti-Dumping Measures •
The Anti-Dumping Duties Act 2015 provides the legislative framework for the investigation and application of antidumping measures in Pakistan.
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Pursuant to the National Tariff Commission Act 2015, the National Tariff Commission (NTC) is the principal investigation authority appointed to carry out all trade defense investigations.
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The NTC normally commences investigations when a written application is filed on behalf of the domestic industry. In certain special cases, the Commission might by itself initiate an investigation too.
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The NTC will impose anti-dumping measures if it finds that the product under investigation is exported to Pakistan at a price lesser than the “normal value” in country of origin and this subsequently causes injury to Pakistani producers of like or competitive goods.
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Provisional anti-dumping duties might be applied during the course of an ongoing investigation for a period of not more than 4 months.
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Pakistan Trade Policy Review 2015, WTO National Tariff Commission
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Once the Commission establishes the existence of dumping and injury in accordance with the provision of the Act, anti-dumping duties to counteract any injuries are imposed for a period of not more than 5 years.
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Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information: http://www.wipo.int/edocs/lexdocs/laws/en/pk/pk106en.pdf
4.1.1.1 Tackling Anti-dumping measures in Pakistan •
Prior to exporting, Saudi exporters must understand the complete production cost of the product and its market price in KSA.
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For avoiding imposition of quantitative restrictions on products imported from KSA, Saudi Exports advises the Exporters to price the exported products not lesser than the price of that product and/or the production cost in KSA.
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Saudi Exporters must also have prima facie evidence to prove that the products are not imported or priced at a price lower than the production cost of the product in that country.
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Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
4.1.2 Countervailing Measures •
The Countervailing Duties Act 2015 provides the legislative framework for the investigation and application of countervailing duties in Pakistan.
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The National Tariff Commission (NTC) carries out investigations with regards to countervailing and initiates these investigations when a written application is filed by a representative of the domestic industry.
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The NTC will impose countervailing duties if it finds that the subsidies granted to an exporter of the investigated product in the country of origin causes injury to the domestic producers in Pakistan.
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Provisional countervailing duties are applied during the course of an ongoing investigation for a period of not more than 4 months.
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If the NTC finds evidence that the subsidized product under investigation injures domestic producers, it imposes definitive countervailing measures for a period of not more than 5 years.
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Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information: http://www.wipo.int/edocs/lexdocs/laws/en/pk/pk103en.pdf
4.1.2.1 Tackling Countervailing measures in Pakistan •
For avoiding imposition of quantitative restrictions on products imported from KSA, Saudi Exports advises the Exporters not to undertake predatory pricing techniques using the subsidy provided in KSA for production and export.
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Saudi Exporters must also have prima facie evidence for defense to prove that the subsidy provided by KSA has not benefited them for reducing the price of the products in Pakistan.
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Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
4.1.3 Safeguard Measures •
The Safeguard Measures Ordinance 2002 provides the legislative frameworks for the investigation and application of safeguard measures in Pakistan.
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The National Tariff Commission initiates safeguard investigations when the increased imports of a particular product are harming local producers of same or like goods.
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The NTC provides recommendations of concluded investigations to the federal government who then decides on the application of safeguard measures. Till date, Pakistan has not imposed any safeguard measures.
4.1.3.1 Tackling Safeguard measures in Pakistan •
Prior to exporting, Saudi exporters must carry out an extensive research on the market to forecast the supply and demand of the imported products in Pakistan.
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In cases where the supply is higher than demand, Saudi Exports advises the exporters to reduce the volume of exports in a way that it does not affect the domestic industries.
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Saudi Exporters must also have prima facie evidence to prove that the volume of products imported will not harm or injure the competitiveness of the domestic industries.
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Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
5. Key Ports in Pakistan25 5.1 Key Sea Ports in Pakistan There are 6 ports in Pakistan, of which the 3 most important, as highlighted by World Port Source, and the CIA Factbook, have been identified in Table 3 below. Further, these have also been illustrated in Figure 1 below. The Port of Karachi handles the bulk of the sea-trade of Pakistan.
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World Ports Source
Table 3: Information about key ports in Pakistan Port Port of Karachi
Port of Gwadar
Port Muhammad bin Qasim
Cargo Handled Project cargo, oil, soybean seeds, petroleum products, pulses, coal, steel, cotton, and cement Operational by the end of 2017-18 Oil, iron, coal, steel, general, bagged break-bulk, bulk, liquid cargo and containerized cargo
Website http://kpt.gov.pk/
http://www.gwadarport.gov.pk/ http://pqa.gov.pk/
Figure 1: Key ports in Pakistan
18
5.2 Key Airports in Pakistan Pakistan Civil Aviation Authority (PCAA) regulating authority for overseeing all laws and regulations governing air transportation. The key freight cargo airports in Pakistan have been notified in Figure 2 below:
Figure 2: Key airports in Pakistan
5.3 Accessing Key Inland Markets in Pakistan 5.3.1 Inland Container Depots (Dry Ports)26 A Dry Port is an inland intermodal terminal that facilitates the movement of sea cargo to inland markets. It is directly connected by road or rail to a sea port. At present, there are 6 dry ports in Pakistan that are operated by the Pakistan Railways. These are situated in Lahore, Karachi, Quetta, Peshawar, Multan, and Rawalpindi. Further, there are 4 dry ports in Pakistan that are established and managed by private operators. These are located in Sialkot, Faisalabad, Lahore, and Quetta.
26
19
ShipMag
5.3.2 Services provided at Inland Container Depots (ICDs) •
Facilities for storage and consolidation of goods
•
Maintenance for road or rail cargo carriers
•
Customs Clearance Services
•
Railways and Road Connectivity
5.3.3 Key Inland Markets and Transportation Methods According to CIA Factbook, the key inland markets in Pakistan include Karachi, Lahore, Islamabad, Faisalabad, Rawalpindi, Peshawar, and Quetta. Information on accessing these key markets are provided in the table below: Table 4: Accessing Key Inland Markets in Pakistan Nearest port (sea / dry)
Karachi
Port of Karachi
Same city
Karachi Dry Port
Same city
Port of Karachi Port Muhammad bin Qasim Lahore Dry Port Port of Karachi Port Muhammad bin Qasim Port of Karachi Port Muhammad bin Qasim Faisalabad Dry Port Port of Karachi Port Muhammad bin Qasim Rawalpindi Dry Port Port of Karachi Port Muhammad bin Qasim Peshawar Dry Port Port of Karachi Port Muhammad bin Qasim Quetta Dry Port
1,246 Kms 1,230 Kms Same city 179 Kms 163 Kms 1,150 Kms 1,134 Kms Same city 1,484 Kms 1,482 Kms Same city 1,363 Kms 1,347 Kms Same city 689 Kms 737 Kms Same city
Lahore
Islamabad Faisalabad
Rawalpindi Peshawar
Quetta
20
Distance from the
Key Cities
port
5.4 Shipping Lines used in Pakistan 5.4.1 Major Shipping Lines and Lead Time from KSA to Pakistan27 According to Linescape, Jeddah Islamic Port, Jubail Port, King Abdul Aziz Port, and King Abdullah Port are the only Ports of Call in KSA for container ships going to Pakistan. Table 5: Lead Time from KSA to Pakistan
Ports in KSA
Jeddah Islamic Port
King Abdul Aziz port
Ports in Pakistan
King Abdullah Port
Port of Jubail
Duration (in days)
Port of Karachi
10 – 48
6 – 47
11 - 45
5 - 46
Port Muhammad bin Qasim
4 – 47
9 – 44
9 - 48
9 - 29
5.4.2 Rates of Key Routes between KSA and Pakistan The costs of shipping from these ports to ports in Pakistan have also been estimated. Please note that the estimates were
based on certain assumptions which are also provided in the table. The shipping costs were estimated using http://worldfreightrates.com/en/freight
Table 6: Shipping Costs from KSA to Pakistan
Ports in KSA
Jeddah Islamic Port
Ports in Pakistan Port of Karachi Port Muhammad bin Qasim
King Abdul Aziz port King Abdullah Port
Cost of Transportation (SAR)* 7, 871 - 11, 318
5, 374 – 7, 725
-
5, 374 – 7, 725
8, 179 – 11, 760
5, 580 - 8, 021
-
5, 580 - 8, 021
*Cost assumptions: Method of shipping selected is ocean Costs were estimated based on the industries available on World Freight Rates The value of all products calculated was priced at 100,000 USD Full container load (FCL) was selected and 40 FT containers & None of the accessorial charges (Hazardous or Insurance) were selected The cost of transportation is a rough estimate
27
21
Linescape
Port of Jubail
5.4.3 Major Air transport lead time and costs from KSA to Pakistan 28 Goods can be exported by air from Jeddah, Dammam and Riyadh airports to Karachi, Gwadar, Quetta, Islamabad, and Lahore which are the 5 key airports in Pakistan. Table 7 below provides the lead time for transporting goods by air from the major airports in KSA to major airport in Pakistan. Kindly note that the lead time has been estimated for direct freight flights. Saudi exporters are requested to kindly visit the link provided foe more accurate and up-to-date information: http://www.worldfreightrates.com/en/freight Table 7: Lead times from KSA to Pakistan
Airports in KSA
King Fahad International, Dammam
Airports in Pakistan
King Khaled International, Riyadh
King Abdulaziz International, Jeddah
Duration (in hours)
Lahore Airport
2-3
3-4
3–4
Karachi Airport
2-3
2-3
2-3
Islamabad Airport
2 -3
3-4
3-4
Quetta Airport
2–3
3-4
3-4
Gwadar Airport
2-3
2-3
2-3
The costs of air cargo from KSA airports to Pakistani airports are estimated in Table 8 below. Please note that the estimates were based on certain assumptions which are also provided in the table below. The freight costs were estimated using http://worldfreightrates.com/en/freight Table 8: Costs from KSA to Pakistan Transportation costs (SAR)
Lahore / Karachi / Islamabad / Quetta / Gwadar
Type of product exported
Frozen food
Jeddah/ Riyadh/ Dammam
10, 629 – 11, 750
*Cost assumptions: Method of shipping selected is air Costs were estimated based on the industries available on World Freight Rates The value of all products calculated was priced at 100,000 USD Load was selected at 210 kg/cm and dimensions as 140*100*90 None of the accessorial charges (Hazardous or Insurance) were selected The cost of transportation is a rough estimate 28
22
World Freight Rates
Frozen meat 10, 677 - 11, 798
6. Key Logistics Facilities 6.1 Storage facilities / services provided at the ports in Pakistan 6.1.1 Bonded Warehouses29 •
Bonded warehouses in Pakistan can take the form of private, public, and common bonded warehouses. Private bonded warehouses: Private bonded warehouses are licensed by Pakistan Customs to individuals or companies for the storage of their own inbound goods/ Public bonded warehouses: Public bonded warehouses are licensed by Pakistan Customs to entrepreneurs for the storage of goods imported by many other importers. Common bond warehouses: Common bond warehouses are licensed by Pakistan Customs for the benefit of Small and Medium Enterprises and facilitates easy access to quality raw materials.
•
These warehouses are licensed by the Collector of Customs and facilitate both duty-free and tax-free storage of imported goods for a certain period of time. Further, upon the payment of applicable fees, and receipt of appropriate permissions from the Collector, owners of any warehoused goods might also carry out manufacturing and other operations in relation to the goods in these warehouses.
•
Goods stored in bonded warehouses are only subject to customs duties and taxes when these enter the market for local consumption.
•
Generally, goods can be stored in bonded warehouses for a period of 1-6 months, and this period can be extended upon furnishing proof of sufficient cause to the Collector of Customs.
7. Overall Import Process: Pakistan 7.1 Overall Import Process via Sea Port30 All imported products that are to be cleared, whether for home consumption, or for warehousing, are to satisfy the set customs clearance procedures. However, import processes differ for reasons such as, if the product is for home consumption or warehousing, transit to another country or transshipment to another customs station. The overall import process for Pakistan is illustrated in Figure 3 below: Stage I: Pre-import Arrangements There are pre-import arrangements that are to be made before the arrival of the goods: 1. The importer must obtain a National Tax Number (NTN) and a Sales Tax Registration Number
29 30
23
The Customs Act 1969, Federal Board of Revenue of Pakistan Pakistan Customs
2. The importer must obtain all relevant clearance certificates, licenses and Import Permits from relevant state agencies for the import of restricted goods. Stage II: Ship arrives31 The shipping agent or the freight forwarder prepares and submits the Import General Manifest (IGM) within 24 hours of the arrival of the goods at the port. Illustrative import process via Sea Port I
Pre-Import Arrangements
III
II
Submission of K1 via EDI
Ship arrives
Zoll Douane
VI
Customer/Importer
V
Logistics & Transportation
IV
Customs clearance at port and payment of duties
Figure 3: Overall Import Process via sea port
= Process stage
Stage III: Bill of Entry via EDI 1. The importer / customs agent completes the Bill of Entry or the Import Goods Declaration (IGD) and submits the documents required for customs clearance via EDI to the Customs house. Note: The EDI of Pakistan is called Web-Based One Customs (WeBoc). Saudi exporters are requested to kindly visit the link provided below for more information about WeBoc: https://www.weboc.gov.pk/(S(ogv5h1wx1kl1ilesr1aitxbf))/Login.aspx
31
24
Pakistan Customs
Stage IV: Customs clearance at port and Payment of Duties 1. Upon submission of the IGD and supporting documentation, applicable customs duties and taxes are calculated based on the information provided and must be paid by the importer. 2. The IGD is assessed by the customs authorities, and the imported goods are thus channelized into green, amber, and red customs clearance lanes (based on different levels of risk assessment set out by WeBoc). 3. Following satisfactory supporting and payment documentation verification and physical inspection checks, the goods are cleared to be released to the importer. Stage V: Logistics and Transportation Importer / declaring agent arranges for the logistics and transportation of the goods from the customs area to his warehouse. Stage VI: Importer / Customer Imported goods are received by the importer / customer.
7.2. Customs Clearance Process32 The customs clearance process for goods imported into Pakistan is illustrated in Figure 4 below: Stage I: Prior to documents submission 1. The importer must register with the Federal Board of Revenue of Pakistan and obtain a NTN and Sales Tax Registration Number. Saudi exporters are requested to kindly visit the link provided below to access the online application form for the same: http://www.fbr.gov.pk/help 2. Relevant Import Licenses / permits are obtained from the respective state agencies for controlled goods as mentioned in the Import Policy order. Further, the exporters of certain goods have to be registered with the Pakistan Standards and Quality Control Authority (PSQCA). 3. The Import General Manifest is to be filed by the shipping agent within 24 hours of the arrival of the ship at the port; this can be done electronically via accessing the link provided below: http://exportefiling.fbr.gov.pk/igm/?view=ExternalLink Stage II: Registration of Import Goods Declaration (IGD) via EDI The importer / customs clearance agents submit the IGD containing all required information and necessary documentation via WeBoc. Saudi exporters are requested to kindly visit the link provided below for more information about completing the IGD: http://www.pakistancustoms.net/2015/01/how-to-file-import-gd-in-weboc.html The IGD can be filed online by accessing the link provided below: http://customsefiling.fbr.gov.pk/EGD/Pages/login.aspx
32
25
Pakistan Customs
Stage III: Review of Documents and payment of taxes and fees 1. The submitted IGD and supporting documents are evaluated for accuracy and completeness of information. 2. If the application is complete, WeBoc employs its own risk management system and channelizes goods into red, amber, and green lanes. Allocation of goods to this color-based assessment category is based on factors such as trader details, history, frequency of imports, and nature of the goods being imported. 3. The relevant taxes and fees are calculated by the customs agent / trader and payment is made. Saudi exporters are requested to kindly visit the link provided below for more information on calculating any applicable duties and taxes: http://valuationgateway.fbr.gov.pk/?view=ExternalLink
Illustrative Customs Process I
II
Registration of IGD via EDI
Prior to documents submission
III
Review of documents and payment of taxes and fees
$
V
IV
Receiving Clearance Notification
Inspection of imported goods
Figure 4: Overall Customs Clearance Process Stage IV: Inspection of imported goods 1. Goods that have been categorized into the red and amber lanes are subject to physical inspection. Note: Goods categorized into the green lane do not have to undergo physical examination
26
= Process stage
2. Following satisfactory physical inspection, the system will send the IGD to a Customs appraiser for verifying duties and taxes paid with the value of the consignment, HS code, and customs duties. If any discrepancies are found, the IGD is send to the cashier for payment of any related extra duties and taxes. Stage V: Release of goods Upon satisfactory payment of all duties and taxes, the IGD is cleared and send to the Gate Out Staff and the importer is free to collect the cargo from the port.
7.3 Lead Time and Cost of Overall Import Process33 According to the World Bank, the associated time and cost of import for a standard goods shipment are listed in Table 9 below: Table 9: Lead Time and Costs of overall import process S. Lead Time Cost Import Procedure No (Hours) (SAR) 1 Documents preparation 147 3,589 2 Customs clearance and inspections 129 2, 948 Total: 276 6, 537
8. Key Import Documents 8.1 Summary table of key import documents 8.1.1 Mandatory Documents34 Seven mandatory documents are required for importing goods into Pakistan. Table 10: Mandatory documents for importing into Pakistan S. No 1 2 3
33 34
27
Document Original Airway Bill / Bill of Lading Commercial Invoice Packing List
Procured from
Procured for
1
Shipping Company
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Doing Business, Trading Across Borders 2017 Pakistan Country Commercial Guide, US Exports
2
3
4
5
6
7
8
9
4 5 6 7
Certificate of Origin Letter of Credit Insurance Certificate Import Goods Declaration (IGD)
Ministry of Commerce and Customs Industry (MCI)
✓✓✓✓✓✓✓✓✓
Bank
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓✓✓✓✓✓✓✓✓
Customs
Customs
✓✓✓✓✓✓✓✓✓
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 – Packaging, 5 - Consumer Durables, 6 - Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 – Textiles 8.1.2 Additional Documents A number of additional documents are generally required for customs clearance, details of which are provided below: Table 7: Additional documents for importing – Pakistan S. No
Document
1
Import Permit
2
Phytosanitary certificate
3
Health Certificate
4
Halal Certificate
Procured from Various relevant ministries in Pakistan Approved authority in origin country Approved authority in origin country Food safety inspection
Procured for
1
2
3
4
5
6
7
8
9
Customs
✓
✓
✓
✓
✓
✓
✓
✓
✓
Customs
Customs Customs
✓
✓
✓
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 - Packaging, 5 - Consumer Durables, 6 - Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 – Textiles
28
✓
8.2 Documents Overview 8.2.1 Bill of Lading35 The Bill of Lading acts as: •
A receipt where the carrier acknowledges that he has received the carriage and acts as an evidence for the contract of carriage.
•
A transferable document of title where the goods are delivered by handing over a bill of lading provided the shipment was consigned ‘to order’ and all the following validations are in order.
A sample of the Ocean Bill of Lading is shown in Figure 5 below.
Figure 5: Ocean Bill of Lading Sample
8.2.2 Commercial Invoice36 The commercial invoice is a bill for the goods purchased, which is provided to the buyer by the seller. Such invoices are mostly used in foreign trade as it allows governments to identify the actual value of the goods when they are assessed for Customs duties. Commercial invoice for Pakistan’s customs clearance should display details such as value, weight, freight and insurance charges.
35 36
29
Intracen Aramex
Figure 6: Commercial Invoice Sample 8.2.3 Packing List37 An international packing list contains details about the seller, buyer, shipper, invoice, number, date of shipment, mode of transport, carrier, and itemizes quantity, description, the type of package, such as a box, crate, drum, or carton, the quantity of packages, total net, and gross weight (in kilograms), package marks, and dimensions.
Figure 7: Packing List Sample
8.2.4 Certificate of Origin38 The Certificate of Origin (CoO) according to the International Chamber of Commerce is a document which attests that the goods imported are wholly obtained, produced, manufactured or processed in a particular country. The CoO for Pakistan should evidence that the goods are of Saudi origin and is issued by the Saudi Arabia. Note: Saudi exporters can obtain the CoO electronically; for more information kindly visit the link provided below: http://mci.gov.sa/en/ServicesDirectory/Pages/Other-services-2015-02.aspx
37 38
30
Global Negotiator Ministry of Commerce and Investments, KSA
Figure 8: CoO Sample 8.2.5 Letter of Credit39 A letter of credit is issued by the exporter’s bank and acts as an assurance that the relevant amount will be remitted to the importer as per the terms and conditions of the document based on the contractual agreement between the exporter and the importer.
Figure 9: Letter of Credit Sample 8.2.6 Insurance Certificate40 An Insurance Certificate is obtained from the exporter and is an assurance provided to the importer that insurance will cover any potential damages or loss to the shipment during transit.
39 40
31
Global Negotiator US Exports
Figure 10: Insurance Certificate Sample 8.2.7 Import Goods Declaration (IGD) The entry of imports into the country must be notified to Pakistan Customs; the form used for this purpose is called the Import Goods Declaration or IGD. It is prepared by the importer / a customs broker acting on behalf of the importer. 8.2.8 Import Permit An Import permit is required for specific products and should be obtained from competent authorities for the import of restricted items. It is required for the purposes of customs clearance. 8.2.9 Health Certificate41 The purpose of the health certificate is to protect human health and safety, and to keep international trade under control. It is procured by the exporter from the relevant authorities in the producing country for products such as foods, chemicals & polymers, and pharmaceuticals.
Figure 11: Health Certificate Sample
41
32
Global Negotiator
8.2.10 Phytosanitary Certificate42 A Phytosanitary Certificate is an official document issued by the plant protection organization of the exporting country to the plant protection organization of the importing country. It attests that the plants or plant products within the scope of the certificate have been inspected according to appropriate procedures and are considered to be free from quarantine pests and practically free from other injurious pests, and that they are considered to conform to the current phytosanitary regulations of the importing country. Phytosanitary certificates are needed to import certain food products in Pakistan.
Figure 12: Phytosanitary Certificate Sample 8.2.11 Halal Slaughtering Certificate / Halal Certificate43 The Halal Certificate is issued by the Board as an assurance that a particular product has been thoroughly investigated and found to conform to the Islamic Sharia laws. The shipment of meat and any product of animal origin for import into Pakistan must be accompanied by a Halal Certificate.
Figure 13: Halal Certificate Sample
42 43
33
Canadian Food Inspection Agency TMFB
9. Key Government Agencies involved in Import 9.1 Key government agencies involved in the import of all types of products There are number of government entities or agencies who are involved in the import process in Pakistan, irrespective of the type of product. These entities or agencies are summarized with their roles in the import process and their websites in Table 11. Table 11: Key Government agencies involved in import Key government agencies Federal Board of Revenue (FBR), Government of Pakistan
Role • •
Central point of revenue collection
•
Division of the Federal Board of Revenue responsible for monitoring the movement of goods in and out of the country
•
Operating under the Ministry of Science and Technology, PQSCA is responsible for overseeing the formulation and implementation of national standard in Pakistan
Pakistan Customs
Pakistan Standards and Quality Control Authority (PSQCA)
National Tariff Commission (NTC)
Pakistan National Accreditation Council (PNAC)
34
Federal agency responsible for administration of the tax laws of Pakistan.
Website
http://www.fbr.gov.pk/
http://www.fbr.gov.pk/Office/Cust oms/38/547
http://www.psqca.com.pk/
•
Inspects and tests products and services for their quality, specification and characteristics during use, and for import and export purposes
•
NTC is the autonomous investigation authority of Pakistan with regards to trade and tariff matters
https://ntc.gov.pk/
•
PNAC operates under the administrative control of the Ministry of Science and Technology and is the central agency involved in the accreditation of conformity assessment bodies
http://pnac.org.pk/
9.2 Key Government Agencies involved in the import of Specific Types of Products There are number of other governmental entities or agencies involved in the import process in Pakistan based on the type of industry or products. A list of key entities or agencies along with the information such as the industry / product types the serve, their role in the import process, and their websites are given in Table 12 Table 12: Government agencies involved in import for specific industries Key government agencies Ministry of National Food Security and Research (MNFSR)
Department of Plant Protection and Quarantine
Animal Quarantine Department
Drug Regulatory Authority of Pakistan (DRAP)
35
•
Role
Website
Oversees the safety of food and food products that enter the Pakistan market with the help of subsidiary bodies
http://www.mnfsr.gov.pk/
•
Operates under the MNFSR and has been established under the Plant Quarantine Act 1976
•
Responsible for implementing import and export controls at 26 border inspection points for plant pests / diseases
•
Responsible for overseeing animal health conditions for import and export
•
Control the import and export of meat at border inspection points
•
Oversees the access to therapeutic goods (drugs, biologics, devices, alternate medicines, and health products in Pakistan
•
Ensures access of safety, quality, and efficacious medicines in Pakistan
http://plantprotection.gov.pk/
http://www.mnfsr.gov.pk/frmDetai ls.aspx?opt=misclinks&id=22
http://www.dra.gov.pk/
10. Key Standard Agencies and their Approval Process 10.1 Standard Agencies according to Industry Goods exported by Saudi exporters that are classified within the nine key industries identified by Saudi Exports are certified by one or more of the following agencies. 1. Pakistan Standards and Quality Control Authority (PSQCA) 2. Ministry of National Food Security and Research 3. Drug Regulatory Authority of Pakistan The matrix in Table 13 shows the industries and the standard agencies they need to approach for their certification. Table 13: Standard Agencies for Particular Industries S. No
1
2
3
Agency Pakistan Standards and Quality Control Authority Ministry of National Food Security and Research Drug Regulatory Authority of Pakistan
1
2
3
4
5
6
7
8
✓ ✓ ✓ ✓ ✓ ✓
9
✓
http://www.psqca.c om.pk/
http://www.mnfsr. gov.pk/
✓
Web Link
✓
http://www.dra.go v.pk/
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 – Packaging, 5 - Consumer Durables, 6 Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 - Textiles
10.2 Pakistan Standards and Quality Control Authority (PSQCA) The Pakistan Standards and Quality Control Authority (PSQCA) is the primary product certification body in Pakistan and has been accredited by the Ministry of Science and Technology. It is responsible for implementing the Certification Mark License Scheme for products entering the market for local consumption. Saudi exporters are requested to kindly visit the link provided below for more information on the complete list of products for which Compulsory Certification Licenses are to be obtained: http://www.psqca.com.pk/compulsory_items.html
The process to enroll products in the Certification Market Scheme has been detailed out below:
36
10.2.1 Process for Acquiring the Certification Mark License Scheme44 Illustration of Certfiication Mark License Scheme
I
II
Fulfillment of pre-requisites and submission of application form
Evaluation of Application
V
Issuance of Certification License and Mark
III
Factory Audit
IV
Laboratory Tests
Figure 14: Certification Mark License Scheme
= Process stage
Stage I: Fulfillment of pre-requisites and submission of application 1. Saudi exporters are requested to complete certain pre-requisites including the preparation of all documentation with regards to the certifiable products. 2. The manufacturers of the products / an authorized representative in Pakistan submits the application for the Certification Mark / License, along with the application fee. Saudi exporters are requested to kindly visit the link provided below for the application form: http://pakalerts.net/PSQ/download.html 3. The application form is to be submitted to the Standards Development Center (SDC) of PSQCA. Stage II: Evaluation of Application 44
37
PSQCA
1. Upon receipt of the application, the Certification Marks Division of SDC acknowledges receipt and allocates a registration number to it. 2. The application form is evaluated for completeness and an Inspection Schedule for the product manufacturing premises is scheduled. Stage III: Factory Audit 1. The Certification Marks division of SDC sends an inspector with a copy of the submitted application form to the respective product manufacturing premises. 2. During the preliminary factory audit, the Inspector assesses the application and the manufacturing premises against the following guidelines: •
Veracity of the application form
•
State of the laboratory facilities used for QA of the products
•
Inspection of the quality of the article at various stages of production
•
Examination of factory premises to establish alignment with Good Manufacturing Practices (GMP).
3. Further, the Inspector also draw samples (raw materials, intermediate, semi-finished, and finished products) to be send to PSQCA testing laboratories. These samples will be evaluated to ensure compliance with Pakistan national standards. Note: The Inspector might also draw random samples from products in circulation in local market, in addition to factory samples. Stage IV: Laboratory Tests 1. The laboratory testing facilities of the PQSCA / other accredited bodies clinically evaluates the drawn samples against a product specification sheet provided by the SDC. 2. The SDC retains one copy of the final test reports and sends another copy to the manufacturer for his / her records and / to rectify product defects, 3. The laboratory facilities issue a bill of testing fee to the manufacturer for the payment of all fees related to testing. Stage V: Grant of Certification Mark License 1. If the testing results show that the sample conforms to the national standards, the Director will recommend the issuance of a Certification Mark license to the manufacturer. 2. The licensee is then required to use the Pakistan Standards Certification Marks on the products responsibly to indicate conformity of product with relevant Pakistan Standards. 3. The products will be subject to periodic surveillance and random product samplings to ensure continued conformity with Pakistan standards.
38
10.2.2 Costs involved45 S. No. 1 2 3
Contents Application Form Registration Fee Laboratory Testing and Inspection Fees License fee
Cost (SAR) 36 Product-specific 178
10.2.3 Lead Time46 S. No. 1 2 3 4
Application Stage Application Form (Evaluation and Registration) Inspection and Sample Collection Laboratory Tests Grant of Certification Mark License Total
Lead Time (in days) 2 1 7 30 40
10.3 Ministry of National Food Security and Research The Ministry of National Food Security and Research is responsible for implementing, enforcing, developing, and executing policy on agriculture, rice, livestock, fishing, and farming. Its subsidiaries: Department of Plant Protection and Quarantine (PPQ) and Animal Quarantine, in conjunction with, Pakistan Customs are responsible for monitoring the import and export of food products into and from the country. Saudi exporters are requested to kindly visit the link provided below: http://www.mnfsr.gov.pk/ The process for the customs clearance of imported food has been detailed out below:
10.3.1 Customs Clearance Process for Imported Food at the Port47
PSQCA PSQCA 47 US FAIRS Country Report – Pakistan 45 46
39
Illustration of Food Customs Clearance Process I
Saudi Exporter prepares documents
II Submission of documents
for customs clearance
III
Review of documents and physical inspection at customs control
IV
Release of products to the importer
Figure 15: Food Customs Clearance Process Stage I: Saudi exporter carries out the perquisites and prepares the necessary documentation 1. All food imports into Pakistan are to be accompanied by written certification (quality certificates) from the producer and exporting country affirming that the products have been produced under sanitary conditions and in disease free areas. 2. Further, any relevant permits and licenses from the Ministry of National Food Security and Research is to be obtained prior to import. Saudi exporters are requested to kindly visit the link provided below for more information on these requirements; http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf
Stage II: Submission of documents for customs clearance 1. The importer / customs clearance agent files the Import Goods Declaration (IGD) via EDI upon arrival of the goods at the port.
40
2. WeBoc channelizes food products into red and amber lanes and the goods are then subject to further inspections and checks by Customs and the relevant food safety agencies. 3. The importer also pays all taxes and fees at this stage. Stage III: Review of documents and physical inspection at customs control 1. The goods are subject to physical inspection along with documentary verification by officials from the Customs Department and the Department of Plant Protection and Quarantine (PPQ)/Animal Quarantine Department. 2. The imports are assessed to ensure compliance with national quality and health standards, import and labelling requirements. Stage IV: Food products are released to the importer On the completion of successful inspection of goods, officials release the goods to the importer.
10.3.2 Lead Time48 The estimated timeframe for the conclusion of the customs clearance procedures is within 7 days.
10.4 Drug Regulatory Authority of Pakistan (DRAP) DRAP has been established under the DRAP Act 2012 and is a federal agency responsible for enforcing the Drugs Act, 1976. The body is expected to standardize the trade and commerce of therapeutic goods. Saudi exporters are requested to kindly visit the link provided below for more information about the authority: http://www.dra.gov.pk/
The Pharmaceutical Evaluations and Registration Division is responsible for the evaluation, assessment, and registration of pharmaceutical drugs and the process for registration of an imported drug has been detailed out below:
10.4.1 Pharmaceutical Products Registration Process49 Stage I: Appointment of an agent Saudi exporter appoints a local agent in Pakistan for the registration of the drugs. Stage II: Saudi exporters fulfills the pre-requisites and submits the registration application 1. Saudi exporters are to prepare the documentation regarding the pharmaceutical products to be registered. 2. The pharmaceutical registration application along with the aforementioned documents is to be submitted to the Regulatory Board Saudi exporters are requested to kindly visit copy paste the link provided below in the web browser for the application form used for registration of an imported drug:
48 49
41
US FAIRS Country Report – Pakistan Drug Regulatory Authority of Pakistan
http://www.dra.gov.pk/userfiles1/file/Download/Application%20Form%20for%20Registration%20of%20an%20Im ported%20Drug.pdf Further, guidance regarding the filing of the registration application and attached documentation can be accessed by copy pasting the link provided below in the web browser: http://www.dra.gov.pk/userfiles1/file/Download/Manzoor%20Bozdar%20Sb%20Section/Guidelines%20for%20authorized% 20officers%20under%20special%20SROs.pdf
Illustration of the process for registering Pharmaceutical Products I
II
Appointment of an agent
III
Saudi exporter fulfills pre-requisites and submits application form
Evaluation of application
✓
V
Registration of drugs
IV
Further evaluation
Figure 16: Pharmaceutical Products Registration process
= Process stage
Stage III: Application Evaluation (Screening Process) The Registration Board evaluates the application for veracity, completeness and relevance. In the event of the need for further investigations, the Board passes all submitted information and material to the Committee on Drugs Evaluation for further assessment.
42
Stage IV: Further evaluation Prior to registration of drugs, the Registration Board will on its own discretion require laboratory analysis, clinical trials, and Good Manufacturing Practices (GMP) of the manufacturing units. Stage V: Registration of drugs Following successful evaluation of the registration dossier and any relevant factory audits and laboratory analysis, the drug is registered and the importer is notified of the outcome. Note: Any discrepancies or failings in any stage of the pharmaceutical registration process is communicated to the exporter via his / her agent and they are given timeframes within which to undertake rectifying action.
10.4.2 Key Documents required for pharmaceutical products registration Saudi exporters are requested to kindly visit the link provided below for detailed information about the documents required for pharmaceutical products registration: http://www.dra.gov.pk/userfiles1/file/Download/Check%20list%20for%20Scrutinization%20of%20Registration%20Application%2 0%20Dossiers.pdf
11. Packaging and Labelling Regulations –Pakistan Pakistan does not have a uniform labelling regime in place and is industry-specific. 11.1 Food Industry 11.1.1 Food Industry Regulator The Ministry of National Food Security and Research (MNFSR) is the food industry regulator in Pakistan. Saudi exporters are requested to kindly visit the link provided below for more information on the regulator: http://www.mnfsr.gov.pk/
11.1.2 Labelling Requirements50 Table12: Minimum labelling requirements S. No
Category
Information requirements
1 2 3
Product Name Manufacturer’s Name and Address Net Weight Fortifying matter (e.g. Vitamins and minerals to powdered milk)
All labels must be in English o Urdu; alternatively, an English or Urdu stick-on label is also acceptable
4
50
43
US FAIRS Country Report
5 6 7
Lot number “Use before” or “Best By” date Ingredients information
11.2 Pharmaceuticals Industry 11.2.1 Pharmaceuticals Industry Regulator The regulator of the pharmaceuticals industry in Pakistan is the Drug Regulatory Authority (DRAP). Saudi exporters are requested to kindly visit the link provided below for more information about the regulator: http://www.dra.gov.pk/
11.2.2 Laws and Regulations The Drug (Labeling and Packing) Rules 1986 and its subsequent amendments oversee the labelling of pharmaceutical products in Pakistan. Saudi exporters are requested to kindly copy paste the links provided below in the web browser for more information: http://www.dra.gov.pk/userfiles1/file/docs/Druglabelingpackingrules1986.pdf http://www.dra.gov.pk/userfiles1/file/Gazettenotificationbarcodeamendments1.pdf
11.2.3 Labelling Requirements51
51
44
S. No
Category
Information requirements
1 2 3 4 5 6 7 8
Registered name of the drug Manufacturer’s Name and Address Drug Manufacturing License Number Drug Registration Number Date of expiry Name of drug dosage and instructions Batch number date of manufacture and the retail price Description of pack size
All labels must be in English o Urdu; alternatively, an English or Urdu stick-on label is also acceptable (Products to have unique barcodes)
Drug Regulatory Authority of Pakistan
12. References Footnotes 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
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Links http://www.pakistan.doingbusinessguide.co.uk/the-guide/business-etiquette,-language-culture/ http://www.doingbusiness.org/~/media/wbg/doingbusiness/documents/profiles/country/pak.pdf https://en.portal.santandertrade.com/establish-overseas/pakistan/business-environment https://pakistan.travisa.com/Common/TVSVisaInstructions.aspx?citizenshipid=sa&countryid=pk&resi denceid=us&partnerid=ta&glid=aus&travelertypeid=BU https://www.export.gov/article?id=Pakistan-Methods-of-Payment http://www.supremecourt.gov.pk/web/user_files/File/thejudicialsystemofPakistan.pdf http://www.doingbusiness.org/data/exploreeconomies/pakistan#enforcing-contracts http://icci.com.pk/data/downloads/64/1837368141_1.pdf https://aric.adb.org/fta/pakistan-gulf-cooperation-council-free-trade-agreement http://2016.export.gov/pakistan/build/groups/public/@eg_pk/documents/webcontent/eg_pk_03364 7.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * http://www.pkrevenue.com/customs/regulatory-duty-ranging-5-15-percent-imposedincreased-on565-imported-items/ http://www.fbr.gov.pk/Office/Sales-Tax/39/130 https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf http://www.psqca.com.pk/psqca.html http://www.psqca.com.pk/psqca.html https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://ntc.gov.pk/ http://www.worldportsource.com/ports/index/PAK.php http://shipmagz.com/node/11 https://www.linescape.com/ http://www.worldfreightrates.com/en/freight http://download1.fbr.gov.pk/Docs/20101111511047546CustomsAct2010.pdf http://www.pakistancustoms.net/2016/08/Custom-Clearance-Procedure-For-Import-In-Pakistan.html
31
http://www.pakcustoms.org/import_general_manifest_igm/ http://www.pakistancustoms.net/2016/08/Custom-Clearance-Procedure-For-Import-In-Pakistan.html 32 http://www.doingbusiness.org/data/exploretopics/trading-across-borders 33 https://www.export.gov/article?id=Pakistan-Import-Requirements-and-Documentation 34 http://www.intracen.org/coffee-guide/logistics-and-insurance/bills-of-lading-and-waybills/ 35 http://www.lynden.com/lint/PDF/Shipping_Forms/Commercial-Invoice.pdf 36 http://www.globalnegotiator.com/en/packing-list-en 37 http://www.aicc.ie/saudi_arabia 38 http://www.globalnegotiator.com/international-trade/dictionary/letter-credit-lc/ 39 https://www.export.gov/article?id=Insurance-Certificate 40 http://www.globalnegotiator.com/international-trade/dictionary/certificate-health/ 41 http://www.inspection.gc.ca/plants/exports/phytosanitary42 certificates/eng/1299872808479/1299872974262 http://www.tmfb.net/halal-certification/halal-certification 43 http://www.psqca.com.pk/enforcement.html 44 http://www.psqca.com.pk/enforcement.html 45 http://www.psqca.com.pk/product_certification_process.html 46 https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 47 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 48 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf http://www.dra.gov.pk/userfiles1/file/Download/RB/Procedure%20of%20Registration.pdf 49 https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 50 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf http://www.dra.gov.pk/userfiles1/file/docs/Druglabelingpackingrules1986.pdf 51 *Kindly copy and paste this link on a web browser to know more information and for updates
46
Table of Contents 1.1. Ease of Doing Business .......................................................................................................................................................................................................... 6 1.2. Business Environment ........................................................................................................................................................................................................... 6 1.3. Working Hours ........................................................................................................................................................................................................................ 7 1.4. Entry requirements in Pakistan for KSA nationals .......................................................................................................................................................... 7 1.5. Key contacts in Pakistan for KSA nationals ...................................................................................................................................................................... 7 1.6. Financial Environment .......................................................................................................................................................................................................... 8 1.7. Legal Environment.................................................................................................................................................................................................................. 8 2.
Rules of Origin......................................................................................................................................................................................................................... 9
2.1 Rules of Origin between Pakistan & KSA .......................................................................................................................................................................... 9 2.1.1 Non-Preferential Rules of Origin – Pakistan ................................................................................................................................................................... 9 3.
Trade Barriers ....................................................................................................................................................................................................................... 10
3.1 Trade Barriers in Pakistan .................................................................................................................................................................................................. 10 3.1.1 Tariff Barriers ........................................................................................................................................................................................................................ 10 3.1.1.1Basic Customs Duty ........................................................................................................................................................................................................... 10 3.1.1.2Regulatory Import Duty .................................................................................................................................................................................................... 11 3.1.1.3Goods and Services Tax (GST) / Sales Tax / Value Added Tax (VAT) ..................................................................................................................... 11 3.1.1.4Special Federal Excise Tax ................................................................................................................................................................................................ 11 3.1.1.5Excise Tax ............................................................................................................................................................................................................................. 12 3.1.1.6Countervailing Duty........................................................................................................................................................................................................... 12 3.1.1.7Anti-dumping Duty ............................................................................................................................................................................................................ 12 3.1.1.8Safeguard Duty ................................................................................................................................................................................................................... 12 3.1.2 Non-tariff barriers................................................................................................................................................................................................................ 13 3.1.2.1Import Prohibitions, Restrictions, and Licensing......................................................................................................................................................... 13 3.1.2.2Standards .............................................................................................................................................................................................................................. 13 3.1.2.3Certification and Conformity Assessment .................................................................................................................................................................... 14 3.1.2.4Accreditation........................................................................................................................................................................................................................ 14 3.1.2.5Labelling................................................................................................................................................................................................................................ 14 3.1.2.6Sanitary and Phytosanitary (SPS) Requirements ........................................................................................................................................................ 15 4.
Trade Remedies.................................................................................................................................................................................................................... 15
4.1 Trade Remedies by Pakistan: Impact on Saudi exporters .......................................................................................................................................... 15 4.1.1 Anti-Dumping Measures ................................................................................................................................................................................................... 15 4.1.1.1Tackling Anti-dumping measures in Pakistan.............................................................................................................................................................. 16 4.1.2 Countervailing Measures................................................................................................................................................................................................... 16 4.1.2.1Tackling Countervailing measures in Pakistan ............................................................................................................................................................ 16 4.1.3 Safeguard Measures............................................................................................................................................................................................................ 17
2
4.1.3.1Tackling Safeguard measures in Pakistan ..................................................................................................................................................................... 17 5.
Key Ports in Pakistan........................................................................................................................................................................................................... 17
5.1 Key Sea Ports in Pakistan ................................................................................................................................................................................................... 17 5.2 Key Airports in Pakistan ..................................................................................................................................................................................................... 19 5.3 Accessing Key Inland Markets in Pakistan..................................................................................................................................................................... 19 5.3.1 Inland Container Depots (Dry Ports) .............................................................................................................................................................................. 19 5.3.2 Services provided at Inland Container Depots (ICDs) ................................................................................................................................................ 20 5.3.3 Key Inland Markets and Transportation Methods....................................................................................................................................................... 20 5.4 Shipping Lines used in Pakistan ....................................................................................................................................................................................... 21 5.4.1 Major Shipping Lines and Lead Time from KSA to Pakistan ..................................................................................................................................... 21 5.4.2 Rates of Key Routes between KSA and Pakistan.......................................................................................................................................................... 21 5.4.3 Major Air transport lead time and costs from KSA to Pakistan ................................................................................................................................ 22 6.
Key Logistics Facilities ........................................................................................................................................................................................................ 23
6.1 Storage facilities / services provided at the ports in Pakistan ................................................................................................................................... 23 6.1.1 Bonded Warehouses ........................................................................................................................................................................................................... 23 7.
Overall Import Process: Pakistan ..................................................................................................................................................................................... 23
7.1 Overall Import Process via Sea Port ................................................................................................................................................................................ 23 7.2. Customs Clearance Process............................................................................................................................................................................................... 25 7.3 Lead Time and Cost of Overall Import Process............................................................................................................................................................. 27 8.
Key Import Documents ...................................................................................................................................................................................................... 27
8.1 Summary table of key import documents ..................................................................................................................................................................... 27 8.1.1 Mandatory Documents ...................................................................................................................................................................................................... 27 8.1.2 Additional Documents ....................................................................................................................................................................................................... 28 8.2 Documents Overview......................................................................................................................................................................................................... 29 8.2.1 Bill of Lading ......................................................................................................................................................................................................................... 29 8.2.2 Commercial Invoice ............................................................................................................................................................................................................ 29 8.2.3 Packing List............................................................................................................................................................................................................................ 30 8.2.4 Certificate of Origin ............................................................................................................................................................................................................. 30 8.2.5 Letter of Credit ...................................................................................................................................................................................................................... 31 8.2.6 Insurance Certificate ........................................................................................................................................................................................................... 31 8.2.7 Import Goods Declaration (IGD)...................................................................................................................................................................................... 32 8.2.8 Import Permit........................................................................................................................................................................................................................ 32 8.2.9 Health Certificate ................................................................................................................................................................................................................. 32 8.2.10 Phytosanitary Certificate ................................................................................................................................................................................................... 33 8.2.11 Halal Slaughtering Certificate / Halal Certificate ......................................................................................................................................................... 33 9.
3
Key Government Agencies involved in Import ............................................................................................................................................................. 34
9.1 Key government agencies involved in the import of all types of products ............................................................................................................ 34 9.2 Key Government Agencies involved in the import of Specific Types of Products................................................................................................ 35 10. Key Standard Agencies and their Approval Process .................................................................................................................................................... 36 10.1 Standard Agencies according to Industry....................................................................................................................................................................... 36 10.2 Pakistan Standards and Quality Control Authority (PSQCA).................................................................................................................................... 36 10.2.1 Process for Acquiring the Certification Mark License Scheme ................................................................................................................................. 37 10.2.2 Costs involved ...................................................................................................................................................................................................................... 39 10.2.3 Lead Time .............................................................................................................................................................................................................................. 39 10.3 Ministry of National Food Security and Research ....................................................................................................................................................... 39 10.3.1 Customs Clearance Process for Imported Food at the Port ....................................................................................................................................... 39 10.3.2 Lead Time .............................................................................................................................................................................................................................. 41 10.4 Drug Regulatory Authority of Pakistan (DRAP) ........................................................................................................................................................... 41 10.4.1 Pharmaceutical Products Registration Process ............................................................................................................................................................ 41 10.4.2 Key Documents required for pharmaceutical products registration ...................................................................................................................... 43 11. Packaging and Labelling Regulations –Pakistan ......................................................................................................................................................... 43 11.1 Food Industry........................................................................................................................................................................................................................ 43 11.1.1 Food Industry Regulator .................................................................................................................................................................................................... 43 11.1.2 Labelling Requirements ..................................................................................................................................................................................................... 43 11.2 Pharmaceuticals Industry .................................................................................................................................................................................................. 44 11.2.1 Pharmaceuticals Industry Regulator ............................................................................................................................................................................... 44 11.2.2 Laws and Regulations......................................................................................................................................................................................................... 44 11.2.3 Labelling Requirements ..................................................................................................................................................................................................... 44 12. References ............................................................................................................................................................................................................................. 45
4
Disclaimer
Saudi Export Development Authority “SAUDI EXPORTS” had prepared the Import Guide as a part of its continuous publication on countries. The purpose of this guide is to provide a high-level view of the country imports process, procedures, documentation requirements, stakeholders…etc., based on available public information. Its analysis, perceptions, and anticipations are subject to personal judgment. “SAUDI EXPORTS” is not liable for any consequences caused by the understanding and interpretation of any part of this guide. In general, the information in the report present a broad view of the imports environment of this country. Saudi exporters are encouraged to carry out further studies to be updated and more informed on the import process, procedures, and documentation requirements identified in this report.
5
1. Business Environment Overview1 1.1. Ease of Doing Business2 Pakistan has been ranked 144th in the world on the ease of doing business by Doing Business, World Bank. The ranking is based on certain key parameters that have been elucidated in Table 1 below: Table 1: Ease of Doing Business Topics Starting a Business Dealing with Construction Permits Getting Electricity Registering Property Getting Credit Protecting Minority Investors Paying Taxes Trading Across Borders Enforcing Contracts Resolving Insolvency
Doing Business Rank (2017) 141 150 170 169 82 27 156 172 157 85
1.2. Business Environment The cultural differences among people and companies might pose several challenges for Saudi exporters in conducting cross border business. For ease of doing business, Saudi exporters must not only understand but also strategize to accommodate significant culture differences between KSA and Pakistan. English and Urdu are the two official languages of communication in Pakistan, although English is the official language to conduct business in Pakistan. The business culture in Pakistan is heavily based on the establishment of familiarity and trust and it will be worthwhile for Saudi exporters to be introduced to a potential trading partner through a mutual reliable contact. Face to face meetings must be scheduled via e-mail three to four weeks in advance. It is advisable to reconfirm the meeting shortly before the scheduled date, as it is common for business appointments to be rescheduled at short notice. Pakistanis expect business associates to be punctual for their business meeting although it is normal for them to arrive a little late. The dress code for corporate meetings is business attire.
1 2
6
Doing Business Guides UK Doing Business, World Bank 2017
The standard way of greetings in business meetings is a handshake accompanied by a smile. Business cards are usually exchanged during business meetings. Potential partners are to be addressed by their forename and surname, until asked to do so otherwise. The decision making process in Pakistan is often slow and Saudi exporters are advised to not rush negotiations.
1.3. Working Hours3 Working hours in Pakistan are different from KSA. Different businesses operate between varied dates and times, as mentioned below in Table 2 . Saudi Exports advises the exporter to recheck with the business partner prior to scheduling business travel. Table 2: Working Hours - Pakistan Working Days
Working Hours
Monday to Friday
9 am – 5:30 pm
•
Government offices are open from 8 am to 3 pm Monday to Thursday and from 8:00 AM to 12:30 pm on Friday and from 8:00 – 2:00 on Saturday
•
Private banks in Pakistan operate from Monday to Thursday from 9 am to 5 pm and reduced hours on Friday and Saturday
1.4. Entry requirements in Pakistan for KSA nationals4 Saudi exporters who intend to visit their trading partners in Pakistan are required to obtain a visa prior to their travels. For more details on the checklist of visa documents, costs, and application forms, Saudi exporters are advised to visit the link provided below: https://pakistan.travisa.com/Common/TVSVisaInstructions.aspx?citizenshipid=sa&countryid=pk&residenceid=us&partneri d=ta&glid=aus&travelertypeid=BU
1.5. Key contacts in Pakistan for KSA nationals The Embassy of the Kingdom of Saudi Arabia is the first point of contact for Saudi exporters and is located in Islamabad in Pakistan. Working hours of the embassy are from 9 A.M. to 4 P.M. The embassy provides assistance and guidance for Saudi nationals in Pakistan and can also be contacted in the event of any issues faced by a Saudi exporter. For more information, Saudi exporters are requested to kindly visit the link provided below: http://embassies.mofa.gov.sa/sites/pakistan/EN/Pages/default.aspx Saudi exporters can also fill in the form provided in the link below for any enquiries: 3 4
7
Santander Trade Pakistan Travisa
http://embassies.mofa.gov.sa/sites/pakistan/EN/ContactDiplomaticMission/Pages/ContactWithDiplomaticMission.aspx
1.6. Financial Environment5 The State Bank of Pakistan is responsible for the regulation and supervision of domestic and foreign banks operating in Pakistan. Currently, there are 41 scheduled banks, 6 development finance institutions (DFIs), and 2 micro finance banks (MFBs) operational in the country. Saudi exporters are requested to kindly visit the link provided below for more information about banks in Pakistan: http://www.sbp.org.pk/ecib/members.htm All imports into Pakistan generally require a compulsory Letter of Credit (L/C). Kindly note that revolving, transferable, and packing letters of credit are not accepted in Pakistan. Payment to the beneficiary of the L /C can be made either in the country of origin or country of shipment of goods. Alternative methods of payment are to be clarified with the State Bank of Pakistan.
1.7. Legal Environment6 Contracts for commercial operations can be drafted in English or Urdu in Pakistan. The Supreme Court of Pakistan is the highest judicial body in the country. The Pakistan judiciary consists of two classes of courts: The superior judiciary: Supreme Court of Pakistan, Federal Shariat Court and five High courts (one High Court for each province, and a High Court for the Islamabad Capital Territory) The lower judiciary: District and Sessions Courts, Judicial Magistrates ‘Court, Special Tribunals and Boards Any commercial disputes or transactions between two parties are first contested at the lower judiciary and then moved to higher judiciaries in the event of further appeals and complaints. Saudi exporters are requested to kindly visit the link provided below for more information about practicing law firms and lawyers in Pakistan: http://www.globaltrade.net/Pakistan/Legal/expert-service-provider.html As of 2017, Pakistan is ranked 157 for enforcing contracts by Doing Business, World Bank. It takes up to 1, 096 days and 18.1% of the claim amount (e.g. it would cost SAR 18, 100 for a claim amount of SAR 100,000) for resolving a commercial dispute through court in Pakistan. 7 In Pakistan, arbitration procedures are followed according to the laws and regulations provided under the Arbitration Act 1940 and the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act 2011.
US Exports Country Commercial Guide Supreme Court of Pakistan 7 Doing Business, World Bank 2017 5 6
8
2. Rules of Origin 2.1 Rules of Origin between Pakistan & KSA8 Rules of origin refers to the specific provisions applied by a country to determine the origin of goods for the purpose of international trade. These are usually based on international agreements or national legislation. Pakistan applies preferential and non-preferential rules of origin to determine the nationality of the imported goods. KSA and Pakistan (including other GCC countries) do not currently have in place a bilateral trade agreement and as such, non-preferential rules of origin are applied to KSA imports into Pakistan. Note: However, Pakistan plans to implement a bilateral agreement with Gulf Co-operation Council titled; Pakistan-Gulf Cooperation Council Free Trade Agreement (Pakistan-GCC FTA).9 The date for the agreement’s ratification is yet unknown. 2.1.1 Non-Preferential Rules of Origin – Pakistan Pakistan applies non-preferential rules of origin for goods imported from Saudi Arabia; the criteria applied to determine origin of non-preferential goods has been set out in the General Agreement on Tariffs and Trade (GATT) Rules of Origin. 1. In Pakistan, two major criteria determine the country of origin of products, namely: a. The “wholly-produced” principle: A product is considered “wholly- produced” within a country if it originates from there and if all the materials used in producing the product are sourced from within the nation. The goods that are considered to be wholly produced/ obtained from an exporting country are: i. Agricultural products yielded from the country; ii. Animals which are born and raised in the country; iii. Products that are obtained from the live animals in the country; iv. Products that are obtained by hunting or fishing conducted in the country; v. Products that are obtained from the sea and from rivers and lakes within the country by a vessel of that country; vi. Products produced on ships from the items notified in (v). vii. Mineral products obtained from the soil or seabed. viii. Scrap and waste that results from the manufacturing operations within the country; ix. Goods that are produced within the country exclusively or mainly from one or both of the following: x. Products referred to in sub-paragraphs (i) to (ix) above;
8 9
9
Islamabad Chamber of Commerce and Industry Asia Regional Integration Centre
b. Principle of “substantial transformation”: Goods that undergo transformation into a new and different product with a distinctive name are subject to the principle of substantial transformation. Goods can be considered as substantially transformed if it fulfills the following rules: i. Value-added rule ii. Change in tariff classification iii. The special processing rule, the minimum transformation required for a good to be classified as of national origin 2. Documentation must be submitted to Customs as evidence of imported goods origin. 3. Certificate of Origin authorizes the origin of imported product and fulfills the document requirements as specified in the bilateral trade agreement. 4. Saudi Exporters can obtain the Certificate of Origin from the Ministry of Commerce and Investment, Saudi Arabia. To obtain the application and for more information on the procedure to obtain the Certificate of Origin, Saudi exporters can visit the link provided below: https://mci.gov.sa/en/Agencies/IndustrialAffairs/a8/Documents/Application%20of%20Origin%20Certificate%20(Ge neral%20Form).pdf
3. Trade Barriers 3.1 Trade Barriers in Pakistan10 Nations trading with each other usually face trade barriers; these include tariff and non-tariff barriers. The trade barriers relevant to Saudi exporters are detailed in the sections below: 3.1.1 Tariff Barriers 3.1.1.1 Basic Customs Duty11 • The Basic Customs Duty is a tariff imposed on goods that are transported across international borders. • As previously mentioned in Section 1.1, in the current absence of a bi-lateral trade agreement between Pakistan and KSA, who are both members of the World Trade Organization (WTO), Most-Favored Nation (MFN) tariffs will apply to Saudi imports into Pakistan. • Customs Duties are calculated on the basis of the Cost, Insurance, and Freight (c.i.f.) value of the imported goods on an ad valorem basis. • The MFN tariff rate in Pakistan, as per Pakistan Customs Tariff (PCT), currently averages at 14.3%; this rate may increase or decrease depending on the type of imports. For instance, certain goods such as: raw materials, machinery, 10 11
10
US Exports-Country Commercial Guide Pakistan Trade Policy Review 2015, WTO
essential foodstuffs, food commodities, and pharmaceutical products are generally non-dutiable or subject to lower tariffs. • Additionally, as a median, the tariffs increase from 7.8% on first-stage processed products, 10.9% on semi-finished goods, and 17.6% on fully processed products. • Saudi exporters are requested to kindly visit the link provided below for more information on product-specific tariff rates: http://download1.fbr.gov.pk/Docs/201610251510131910Tarrif-Chaper1To99-2016-17.pdf 3.1.1.2 Regulatory Import Duty12 • The Federal Board of Revenue (FBR) levies Regulatory Import Duty (RD) on 565 items – the rates range from 5% 15%. • Some of the goods on which RD are charged include mobile phones, telecom equipment. • Saudi exporters are requested to kindly visit the link provided below for more information: http://www.pkrevenue.com/customs/regulatory-duty-ranging-5-15-percent-imposedincreased-on-565-importeditems/ 3.1.1.3 Goods and Services Tax (GST) / Sales Tax / Value Added Tax (VAT)13 • Under the Sales Tax Act 1990, the government of Pakistan levies Sales Tax / VAT on most goods and services in Pakistan (locally produced / imported). • VAT is generally levied at an average of 17% of value of supplies.14 • Goods such as computer software, poultry feeds, and medicines, are exempt from VAT. • Saudi exporters are requested to kindly visit the link provided below for more information on the complete list of goods that are exempt from Sales Tax / VAT http://files.tron.pk/6th.pdf 3.1.1.4 Special Federal Excise Tax15 • The federal government of Pakistan also levies a Special Federal Excise Tax of 1% on all goods and services produced domestically or imported. • Certain goods such as food products, tractors, certain vehicles, and vehicle assembly kits are exempt from being subject to Special Federal Excise Tax. • Saudi exporters are requested to kindly visit the link provided below for more information on the goods and services exempt from Special Federal Excise Tax. Pakistan Revenue Federal Board of Revenue Government of Pakistan 14 Pakistan Trade Policy Review 2015, WTO 15 Pakistan Trade Policy Review 2015, WTO 12 13
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http://download1.fbr.gov.pk/sros/FederalExciseSROs/2007/2007sro655.pdf 3.1.1.5 Excise Tax16 • Excise duty is an indirect tax charged on the import of certain goods into Pakistan that are deemed to be non-essential, and harmful to public health and environment. Some of the goods subject to Excise Tax include tobacco and petroleum products. • For more information, Saudi exporters can visit the link provided below: http://www.fbr.gov.pk/SROs/Federal%20Excise/1 3.1.1.6 Countervailing Duty17 • Certain goods imported into Pakistan benefit from the application of subsidies in the way of foreign governmental financial assistance (for instance: tax incentives, loans at preferential rates, grants). If these provisions cause damage or injure the local production of similar goods, countervailing investigations can be initiated. • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting investigations into allegations of countervailing and subsequent injury to the domestic industry. • The Appellate Tribunal hears appeals against any countervailing decisions and these can also be further appealed at the High Court and Supreme Court. • Further information is provided in Section 4.1.1of this guide. 3.1.1.7 Anti-dumping Duty • Anti-dumping duties are imposed when goods are imported into Pakistan at prices lower than the market values in the country of export and this causes injury / harm to domestic Pakistani producers of likes or competitive goods • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting investigations into allegations of dumping and subsequent injury to the domestic industry. • Further information is provided in Section 4.1.1 of this guide 3.1.1.8 Safeguard Duty18 • Safeguard Duties are implemented as an emergency measure when the increase in imports of certain goods affects the domestic industry producing similar goods in Pakistan. • The National Tariff Commission (NTC) of Pakistan is the authority responsible for conducting safeguard investigations. • Further information is provided in Section 4.1.1 of this guide.
Pakistan Trade Policy Review 2015, WTO Pakistan Trade Policy Review 2015, WTO 18 Pakistan Trade Policy Review 2015, WTO 16 17
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3.1.2 Non-tariff barriers 3.1.2.1 Import Prohibitions, Restrictions, and Licensing19 • Imports of certain products are prohibited and / restricted for health and safety, security, moral and environmental reasons. • Goods subject to import prohibitions and restrictions are notified in Appendices A and B respectively of the Import Policy Order issued by the federal government. • Examples of prohibited imports include hazardous chemicals, and retreaded tires. Saudi exporters are requested to kindly visit the link provided below (Pg 11) for more information on the complete list of prohibited items. http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf • Items that are restricted for import are allowed entry into Pakistan upon furnishing evidence of fulfillment of all associated requirements (prior approval or clearance from relevant regulatory agencies and compliance with national standards) • Import restrictions apply to food and food items, pharmaceuticals and building materials to name a few. Saudi exporters are requested to kindly copy paste the link provided below (Pgs 18 and 132) in the web browser for more information on the complete list of restricted items and associated conditions: http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf 3.1.2.2 Standards20 • The standard setting process in Pakistan is governed by the Pakistan Standards and Quality Control Authority (PQSCA), established in 1996, under the purview of the Ministry of Science and Technology. • The PSQCA adopts and develops national standards, in collaboration with one of its 11 national entities and relevant technical committees. • It is a member of the following international organizations: o International Organization for Standardization o International Electrochemical Commission o International Organization of Legal Metrology (OIML) •
PSQCA has adopted 22,070 ISO standards and developed 8,857 national standards. It is the National Enquiry Point (NEP) for the WTO Agreement on Technical Barriers to Trade (TBT).
•
Standards in Pakistan are both voluntary and mandatory; goods subject to mandatory standards require product certification prior to entry into the local market for consumption.
•
19 20
13
Saudi exporters are requested to kindly visit the link provided below for more information about PQSCA:
Karachi Customs Agents Association Pakistan Standards and Quality Control Authority
http://www.psqca.com.pk/psqca.html 3.1.2.3 Certification and Conformity Assessment21 • PQSCA has deemed 109 products as “mandatory products” or products that should adhere to Pakistan standards at the import stage. Examples of these products include fruit juices, food for infants, and cement-related products. These have been notified in the Import Policy Order of 2016; Saudi exporters are requested to kindly copy paste the link provided below in the web browser for the entire list: http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf (Pg 135) • These mandatory products are to be registered under the Compulsory Certification Mark License Scheme of Pakistan at the import stage. Additionally, exporters of these products have to be registered with the PSQCA to ensure compliance. • The Quality Control Center (QCC) of PSQCA offers multifunctional testing laboratories and services for conformity assessment of these products. • More information regarding this is provided in Section 10 of this guide. 3.1.2.4 Accreditation •
The Pakistan National Accreditation Council (PNAC) operates under the administrative control of the Ministry of Science and Technology and is the national accreditation body for testing laboratories and other conformity assessment facilities
•
Further, PNAC is a signatory to voluntary accreditation agreements such as the International Accreditation Forum (IAF), and the Asia-Pacific Laboratory Accreditation Cooperation (APLAC).
•
As such, Saudi exporters who are required to obtain conformity assessment certificates prior to the export of certain regulated goods into Pakistan (as mentioned in Section 3.1.2.1) can obtain the same from national testing and calibration laboratories accredited by the IAF.
•
For more information regarding national accredited conformity assessment bodies and testing facilities, kindly visit the link provided below: http://pnac.org.pk/
3.1.2.5 Labelling22 •
Pakistan does not have a uniform labelling regulatory framework in place.
•
Labelling requirements of certain industries or sectors are governed by the relevant state agency. For instance, the Ministry of Agriculture sets requirements for the labelling of pesticides and edible products.
•
21 22
14
More information can be found in Section11 of this guide
Pakistan Standards and Quality Control Authority Pakistan Trade Policy Review 2015, WTO
3.1.2.6 Sanitary and Phytosanitary (SPS) Requirements23 •
Sanitary and phytosanitary requirements have to be met prior to importing plants and plant products, animals and animal products, and food into Pakistan.
•
The National Animal and Plant Health Inspection Services (NAPHIS), under the Ministry of National Food Security and Research, is the proposed notification authority and enquiry point under the WTO- SPS Agreement. Note: NAPHIS has not been legally ratified yet and its legal ratification has been on hold since 2012
•
Currently, the Department of Customs, Plant Protection and Quarantine (PPQ), and the Department of Animal Quarantine (DAQ) are responsible for overseeing the import of food and food products into Pakistan.
•
Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information on agencies governing food safety and security in Pakistan: https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf (Table 3.5)
4. Trade Remedies 4.1 Trade Remedies by Pakistan: Impact on Saudi exporters24 Trade remedies are tools that facilitate the government of Pakistan to take remedial action against exports causing material injury to the domestic industry. The below mentioned trade remedies can be imposed upon Saudi exporters under such conditions. 4.1.1 Anti-Dumping Measures •
The Anti-Dumping Duties Act 2015 provides the legislative framework for the investigation and application of antidumping measures in Pakistan.
•
Pursuant to the National Tariff Commission Act 2015, the National Tariff Commission (NTC) is the principal investigation authority appointed to carry out all trade defense investigations.
•
The NTC normally commences investigations when a written application is filed on behalf of the domestic industry. In certain special cases, the Commission might by itself initiate an investigation too.
•
The NTC will impose anti-dumping measures if it finds that the product under investigation is exported to Pakistan at a price lesser than the “normal value” in country of origin and this subsequently causes injury to Pakistani producers of like or competitive goods.
•
Provisional anti-dumping duties might be applied during the course of an ongoing investigation for a period of not more than 4 months.
23 24
15
Pakistan Trade Policy Review 2015, WTO National Tariff Commission
•
Once the Commission establishes the existence of dumping and injury in accordance with the provision of the Act, anti-dumping duties to counteract any injuries are imposed for a period of not more than 5 years.
•
Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information: http://www.wipo.int/edocs/lexdocs/laws/en/pk/pk106en.pdf
4.1.1.1 Tackling Anti-dumping measures in Pakistan •
Prior to exporting, Saudi exporters must understand the complete production cost of the product and its market price in KSA.
•
For avoiding imposition of quantitative restrictions on products imported from KSA, Saudi Exports advises the Exporters to price the exported products not lesser than the price of that product and/or the production cost in KSA.
•
Saudi Exporters must also have prima facie evidence to prove that the products are not imported or priced at a price lower than the production cost of the product in that country.
•
Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
4.1.2 Countervailing Measures •
The Countervailing Duties Act 2015 provides the legislative framework for the investigation and application of countervailing duties in Pakistan.
•
The National Tariff Commission (NTC) carries out investigations with regards to countervailing and initiates these investigations when a written application is filed by a representative of the domestic industry.
•
The NTC will impose countervailing duties if it finds that the subsidies granted to an exporter of the investigated product in the country of origin causes injury to the domestic producers in Pakistan.
•
Provisional countervailing duties are applied during the course of an ongoing investigation for a period of not more than 4 months.
•
If the NTC finds evidence that the subsidized product under investigation injures domestic producers, it imposes definitive countervailing measures for a period of not more than 5 years.
•
Saudi exporters are requested to kindly copy paste the link provided below in the web browser for more information: http://www.wipo.int/edocs/lexdocs/laws/en/pk/pk103en.pdf
4.1.2.1 Tackling Countervailing measures in Pakistan •
For avoiding imposition of quantitative restrictions on products imported from KSA, Saudi Exports advises the Exporters not to undertake predatory pricing techniques using the subsidy provided in KSA for production and export.
•
Saudi Exporters must also have prima facie evidence for defense to prove that the subsidy provided by KSA has not benefited them for reducing the price of the products in Pakistan.
16
•
Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
4.1.3 Safeguard Measures •
The Safeguard Measures Ordinance 2002 provides the legislative frameworks for the investigation and application of safeguard measures in Pakistan.
•
The National Tariff Commission initiates safeguard investigations when the increased imports of a particular product are harming local producers of same or like goods.
•
The NTC provides recommendations of concluded investigations to the federal government who then decides on the application of safeguard measures. Till date, Pakistan has not imposed any safeguard measures.
4.1.3.1 Tackling Safeguard measures in Pakistan •
Prior to exporting, Saudi exporters must carry out an extensive research on the market to forecast the supply and demand of the imported products in Pakistan.
•
In cases where the supply is higher than demand, Saudi Exports advises the exporters to reduce the volume of exports in a way that it does not affect the domestic industries.
•
Saudi Exporters must also have prima facie evidence to prove that the volume of products imported will not harm or injure the competitiveness of the domestic industries.
•
Saudi Exports advises Saudi exporters to exercise caution while disclosing prima facie evidence to foreign governments and to share only the needful.
5. Key Ports in Pakistan25 5.1 Key Sea Ports in Pakistan There are 6 ports in Pakistan, of which the 3 most important, as highlighted by World Port Source, and the CIA Factbook, have been identified in Table 3 below. Further, these have also been illustrated in Figure 1 below. The Port of Karachi handles the bulk of the sea-trade of Pakistan.
25
17
World Ports Source
Table 3: Information about key ports in Pakistan Port Port of Karachi
Port of Gwadar
Port Muhammad bin Qasim
Cargo Handled Project cargo, oil, soybean seeds, petroleum products, pulses, coal, steel, cotton, and cement Operational by the end of 2017-18 Oil, iron, coal, steel, general, bagged break-bulk, bulk, liquid cargo and containerized cargo
Website http://kpt.gov.pk/
http://www.gwadarport.gov.pk/ http://pqa.gov.pk/
Figure 1: Key ports in Pakistan
18
5.2 Key Airports in Pakistan Pakistan Civil Aviation Authority (PCAA) regulating authority for overseeing all laws and regulations governing air transportation. The key freight cargo airports in Pakistan have been notified in Figure 2 below:
Figure 2: Key airports in Pakistan
5.3 Accessing Key Inland Markets in Pakistan 5.3.1 Inland Container Depots (Dry Ports)26 A Dry Port is an inland intermodal terminal that facilitates the movement of sea cargo to inland markets. It is directly connected by road or rail to a sea port. At present, there are 6 dry ports in Pakistan that are operated by the Pakistan Railways. These are situated in Lahore, Karachi, Quetta, Peshawar, Multan, and Rawalpindi. Further, there are 4 dry ports in Pakistan that are established and managed by private operators. These are located in Sialkot, Faisalabad, Lahore, and Quetta.
26
19
ShipMag
5.3.2 Services provided at Inland Container Depots (ICDs) •
Facilities for storage and consolidation of goods
•
Maintenance for road or rail cargo carriers
•
Customs Clearance Services
•
Railways and Road Connectivity
5.3.3 Key Inland Markets and Transportation Methods According to CIA Factbook, the key inland markets in Pakistan include Karachi, Lahore, Islamabad, Faisalabad, Rawalpindi, Peshawar, and Quetta. Information on accessing these key markets are provided in the table below: Table 4: Accessing Key Inland Markets in Pakistan Nearest port (sea / dry)
Karachi
Port of Karachi
Same city
Karachi Dry Port
Same city
Port of Karachi Port Muhammad bin Qasim Lahore Dry Port Port of Karachi Port Muhammad bin Qasim Port of Karachi Port Muhammad bin Qasim Faisalabad Dry Port Port of Karachi Port Muhammad bin Qasim Rawalpindi Dry Port Port of Karachi Port Muhammad bin Qasim Peshawar Dry Port Port of Karachi Port Muhammad bin Qasim Quetta Dry Port
1,246 Kms 1,230 Kms Same city 179 Kms 163 Kms 1,150 Kms 1,134 Kms Same city 1,484 Kms 1,482 Kms Same city 1,363 Kms 1,347 Kms Same city 689 Kms 737 Kms Same city
Lahore
Islamabad Faisalabad
Rawalpindi Peshawar
Quetta
20
Distance from the
Key Cities
port
5.4 Shipping Lines used in Pakistan 5.4.1 Major Shipping Lines and Lead Time from KSA to Pakistan27 According to Linescape, Jeddah Islamic Port, Jubail Port, King Abdul Aziz Port, and King Abdullah Port are the only Ports of Call in KSA for container ships going to Pakistan. Table 5: Lead Time from KSA to Pakistan
Ports in KSA
Jeddah Islamic Port
King Abdul Aziz port
Ports in Pakistan
King Abdullah Port
Port of Jubail
Duration (in days)
Port of Karachi
10 – 48
6 – 47
11 - 45
5 - 46
Port Muhammad bin Qasim
4 – 47
9 – 44
9 - 48
9 - 29
5.4.2 Rates of Key Routes between KSA and Pakistan The costs of shipping from these ports to ports in Pakistan have also been estimated. Please note that the estimates were
based on certain assumptions which are also provided in the table. The shipping costs were estimated using http://worldfreightrates.com/en/freight
Table 6: Shipping Costs from KSA to Pakistan
Ports in KSA
Jeddah Islamic Port
Ports in Pakistan Port of Karachi Port Muhammad bin Qasim
King Abdul Aziz port King Abdullah Port
Cost of Transportation (SAR)* 7, 871 - 11, 318
5, 374 – 7, 725
-
5, 374 – 7, 725
8, 179 – 11, 760
5, 580 - 8, 021
-
5, 580 - 8, 021
*Cost assumptions: Method of shipping selected is ocean Costs were estimated based on the industries available on World Freight Rates The value of all products calculated was priced at 100,000 USD Full container load (FCL) was selected and 40 FT containers & None of the accessorial charges (Hazardous or Insurance) were selected The cost of transportation is a rough estimate
27
21
Linescape
Port of Jubail
5.4.3 Major Air transport lead time and costs from KSA to Pakistan 28 Goods can be exported by air from Jeddah, Dammam and Riyadh airports to Karachi, Gwadar, Quetta, Islamabad, and Lahore which are the 5 key airports in Pakistan. Table 7 below provides the lead time for transporting goods by air from the major airports in KSA to major airport in Pakistan. Kindly note that the lead time has been estimated for direct freight flights. Saudi exporters are requested to kindly visit the link provided foe more accurate and up-to-date information: http://www.worldfreightrates.com/en/freight Table 7: Lead times from KSA to Pakistan
Airports in KSA
King Fahad International, Dammam
Airports in Pakistan
King Khaled International, Riyadh
King Abdulaziz International, Jeddah
Duration (in hours)
Lahore Airport
2-3
3-4
3–4
Karachi Airport
2-3
2-3
2-3
Islamabad Airport
2 -3
3-4
3-4
Quetta Airport
2–3
3-4
3-4
Gwadar Airport
2-3
2-3
2-3
The costs of air cargo from KSA airports to Pakistani airports are estimated in Table 8 below. Please note that the estimates were based on certain assumptions which are also provided in the table below. The freight costs were estimated using http://worldfreightrates.com/en/freight Table 8: Costs from KSA to Pakistan Transportation costs (SAR)
Lahore / Karachi / Islamabad / Quetta / Gwadar
Type of product exported
Frozen food
Jeddah/ Riyadh/ Dammam
10, 629 – 11, 750
*Cost assumptions: Method of shipping selected is air Costs were estimated based on the industries available on World Freight Rates The value of all products calculated was priced at 100,000 USD Load was selected at 210 kg/cm and dimensions as 140*100*90 None of the accessorial charges (Hazardous or Insurance) were selected The cost of transportation is a rough estimate 28
22
World Freight Rates
Frozen meat 10, 677 - 11, 798
6. Key Logistics Facilities 6.1 Storage facilities / services provided at the ports in Pakistan 6.1.1 Bonded Warehouses29 •
Bonded warehouses in Pakistan can take the form of private, public, and common bonded warehouses. Private bonded warehouses: Private bonded warehouses are licensed by Pakistan Customs to individuals or companies for the storage of their own inbound goods/ Public bonded warehouses: Public bonded warehouses are licensed by Pakistan Customs to entrepreneurs for the storage of goods imported by many other importers. Common bond warehouses: Common bond warehouses are licensed by Pakistan Customs for the benefit of Small and Medium Enterprises and facilitates easy access to quality raw materials.
•
These warehouses are licensed by the Collector of Customs and facilitate both duty-free and tax-free storage of imported goods for a certain period of time. Further, upon the payment of applicable fees, and receipt of appropriate permissions from the Collector, owners of any warehoused goods might also carry out manufacturing and other operations in relation to the goods in these warehouses.
•
Goods stored in bonded warehouses are only subject to customs duties and taxes when these enter the market for local consumption.
•
Generally, goods can be stored in bonded warehouses for a period of 1-6 months, and this period can be extended upon furnishing proof of sufficient cause to the Collector of Customs.
7. Overall Import Process: Pakistan 7.1 Overall Import Process via Sea Port30 All imported products that are to be cleared, whether for home consumption, or for warehousing, are to satisfy the set customs clearance procedures. However, import processes differ for reasons such as, if the product is for home consumption or warehousing, transit to another country or transshipment to another customs station. The overall import process for Pakistan is illustrated in Figure 3 below: Stage I: Pre-import Arrangements There are pre-import arrangements that are to be made before the arrival of the goods: 1. The importer must obtain a National Tax Number (NTN) and a Sales Tax Registration Number
29 30
23
The Customs Act 1969, Federal Board of Revenue of Pakistan Pakistan Customs
2. The importer must obtain all relevant clearance certificates, licenses and Import Permits from relevant state agencies for the import of restricted goods. Stage II: Ship arrives31 The shipping agent or the freight forwarder prepares and submits the Import General Manifest (IGM) within 24 hours of the arrival of the goods at the port. Illustrative import process via Sea Port I
Pre-Import Arrangements
III
II
Submission of K1 via EDI
Ship arrives
Zoll Douane
VI
Customer/Importer
V
Logistics & Transportation
IV
Customs clearance at port and payment of duties
Figure 3: Overall Import Process via sea port
= Process stage
Stage III: Bill of Entry via EDI 1. The importer / customs agent completes the Bill of Entry or the Import Goods Declaration (IGD) and submits the documents required for customs clearance via EDI to the Customs house. Note: The EDI of Pakistan is called Web-Based One Customs (WeBoc). Saudi exporters are requested to kindly visit the link provided below for more information about WeBoc: https://www.weboc.gov.pk/(S(ogv5h1wx1kl1ilesr1aitxbf))/Login.aspx
31
24
Pakistan Customs
Stage IV: Customs clearance at port and Payment of Duties 1. Upon submission of the IGD and supporting documentation, applicable customs duties and taxes are calculated based on the information provided and must be paid by the importer. 2. The IGD is assessed by the customs authorities, and the imported goods are thus channelized into green, amber, and red customs clearance lanes (based on different levels of risk assessment set out by WeBoc). 3. Following satisfactory supporting and payment documentation verification and physical inspection checks, the goods are cleared to be released to the importer. Stage V: Logistics and Transportation Importer / declaring agent arranges for the logistics and transportation of the goods from the customs area to his warehouse. Stage VI: Importer / Customer Imported goods are received by the importer / customer.
7.2. Customs Clearance Process32 The customs clearance process for goods imported into Pakistan is illustrated in Figure 4 below: Stage I: Prior to documents submission 1. The importer must register with the Federal Board of Revenue of Pakistan and obtain a NTN and Sales Tax Registration Number. Saudi exporters are requested to kindly visit the link provided below to access the online application form for the same: http://www.fbr.gov.pk/help 2. Relevant Import Licenses / permits are obtained from the respective state agencies for controlled goods as mentioned in the Import Policy order. Further, the exporters of certain goods have to be registered with the Pakistan Standards and Quality Control Authority (PSQCA). 3. The Import General Manifest is to be filed by the shipping agent within 24 hours of the arrival of the ship at the port; this can be done electronically via accessing the link provided below: http://exportefiling.fbr.gov.pk/igm/?view=ExternalLink Stage II: Registration of Import Goods Declaration (IGD) via EDI The importer / customs clearance agents submit the IGD containing all required information and necessary documentation via WeBoc. Saudi exporters are requested to kindly visit the link provided below for more information about completing the IGD: http://www.pakistancustoms.net/2015/01/how-to-file-import-gd-in-weboc.html The IGD can be filed online by accessing the link provided below: http://customsefiling.fbr.gov.pk/EGD/Pages/login.aspx
32
25
Pakistan Customs
Stage III: Review of Documents and payment of taxes and fees 1. The submitted IGD and supporting documents are evaluated for accuracy and completeness of information. 2. If the application is complete, WeBoc employs its own risk management system and channelizes goods into red, amber, and green lanes. Allocation of goods to this color-based assessment category is based on factors such as trader details, history, frequency of imports, and nature of the goods being imported. 3. The relevant taxes and fees are calculated by the customs agent / trader and payment is made. Saudi exporters are requested to kindly visit the link provided below for more information on calculating any applicable duties and taxes: http://valuationgateway.fbr.gov.pk/?view=ExternalLink
Illustrative Customs Process I
II
Registration of IGD via EDI
Prior to documents submission
III
Review of documents and payment of taxes and fees
$
V
IV
Receiving Clearance Notification
Inspection of imported goods
Figure 4: Overall Customs Clearance Process Stage IV: Inspection of imported goods 1. Goods that have been categorized into the red and amber lanes are subject to physical inspection. Note: Goods categorized into the green lane do not have to undergo physical examination
26
= Process stage
2. Following satisfactory physical inspection, the system will send the IGD to a Customs appraiser for verifying duties and taxes paid with the value of the consignment, HS code, and customs duties. If any discrepancies are found, the IGD is send to the cashier for payment of any related extra duties and taxes. Stage V: Release of goods Upon satisfactory payment of all duties and taxes, the IGD is cleared and send to the Gate Out Staff and the importer is free to collect the cargo from the port.
7.3 Lead Time and Cost of Overall Import Process33 According to the World Bank, the associated time and cost of import for a standard goods shipment are listed in Table 9 below: Table 9: Lead Time and Costs of overall import process S. Lead Time Cost Import Procedure No (Hours) (SAR) 1 Documents preparation 147 3,589 2 Customs clearance and inspections 129 2, 948 Total: 276 6, 537
8. Key Import Documents 8.1 Summary table of key import documents 8.1.1 Mandatory Documents34 Seven mandatory documents are required for importing goods into Pakistan. Table 10: Mandatory documents for importing into Pakistan S. No 1 2 3
33 34
27
Document Original Airway Bill / Bill of Lading Commercial Invoice Packing List
Procured from
Procured for
1
Shipping Company
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Doing Business, Trading Across Borders 2017 Pakistan Country Commercial Guide, US Exports
2
3
4
5
6
7
8
9
4 5 6 7
Certificate of Origin Letter of Credit Insurance Certificate Import Goods Declaration (IGD)
Ministry of Commerce and Customs Industry (MCI)
✓✓✓✓✓✓✓✓✓
Bank
Customs
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Exporter
Customs
✓✓✓✓✓✓✓✓✓
Customs
Customs
✓✓✓✓✓✓✓✓✓
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 – Packaging, 5 - Consumer Durables, 6 - Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 – Textiles 8.1.2 Additional Documents A number of additional documents are generally required for customs clearance, details of which are provided below: Table 7: Additional documents for importing – Pakistan S. No
Document
1
Import Permit
2
Phytosanitary certificate
3
Health Certificate
4
Halal Certificate
Procured from Various relevant ministries in Pakistan Approved authority in origin country Approved authority in origin country Food safety inspection
Procured for
1
2
3
4
5
6
7
8
9
Customs
✓
✓
✓
✓
✓
✓
✓
✓
✓
Customs
Customs Customs
✓
✓
✓
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 - Packaging, 5 - Consumer Durables, 6 - Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 – Textiles
28
✓
8.2 Documents Overview 8.2.1 Bill of Lading35 The Bill of Lading acts as: •
A receipt where the carrier acknowledges that he has received the carriage and acts as an evidence for the contract of carriage.
•
A transferable document of title where the goods are delivered by handing over a bill of lading provided the shipment was consigned ‘to order’ and all the following validations are in order.
A sample of the Ocean Bill of Lading is shown in Figure 5 below.
Figure 5: Ocean Bill of Lading Sample
8.2.2 Commercial Invoice36 The commercial invoice is a bill for the goods purchased, which is provided to the buyer by the seller. Such invoices are mostly used in foreign trade as it allows governments to identify the actual value of the goods when they are assessed for Customs duties. Commercial invoice for Pakistan’s customs clearance should display details such as value, weight, freight and insurance charges.
35 36
29
Intracen Aramex
Figure 6: Commercial Invoice Sample 8.2.3 Packing List37 An international packing list contains details about the seller, buyer, shipper, invoice, number, date of shipment, mode of transport, carrier, and itemizes quantity, description, the type of package, such as a box, crate, drum, or carton, the quantity of packages, total net, and gross weight (in kilograms), package marks, and dimensions.
Figure 7: Packing List Sample
8.2.4 Certificate of Origin38 The Certificate of Origin (CoO) according to the International Chamber of Commerce is a document which attests that the goods imported are wholly obtained, produced, manufactured or processed in a particular country. The CoO for Pakistan should evidence that the goods are of Saudi origin and is issued by the Saudi Arabia. Note: Saudi exporters can obtain the CoO electronically; for more information kindly visit the link provided below: http://mci.gov.sa/en/ServicesDirectory/Pages/Other-services-2015-02.aspx
37 38
30
Global Negotiator Ministry of Commerce and Investments, KSA
Figure 8: CoO Sample 8.2.5 Letter of Credit39 A letter of credit is issued by the exporter’s bank and acts as an assurance that the relevant amount will be remitted to the importer as per the terms and conditions of the document based on the contractual agreement between the exporter and the importer.
Figure 9: Letter of Credit Sample 8.2.6 Insurance Certificate40 An Insurance Certificate is obtained from the exporter and is an assurance provided to the importer that insurance will cover any potential damages or loss to the shipment during transit.
39 40
31
Global Negotiator US Exports
Figure 10: Insurance Certificate Sample 8.2.7 Import Goods Declaration (IGD) The entry of imports into the country must be notified to Pakistan Customs; the form used for this purpose is called the Import Goods Declaration or IGD. It is prepared by the importer / a customs broker acting on behalf of the importer. 8.2.8 Import Permit An Import permit is required for specific products and should be obtained from competent authorities for the import of restricted items. It is required for the purposes of customs clearance. 8.2.9 Health Certificate41 The purpose of the health certificate is to protect human health and safety, and to keep international trade under control. It is procured by the exporter from the relevant authorities in the producing country for products such as foods, chemicals & polymers, and pharmaceuticals.
Figure 11: Health Certificate Sample
41
32
Global Negotiator
8.2.10 Phytosanitary Certificate42 A Phytosanitary Certificate is an official document issued by the plant protection organization of the exporting country to the plant protection organization of the importing country. It attests that the plants or plant products within the scope of the certificate have been inspected according to appropriate procedures and are considered to be free from quarantine pests and practically free from other injurious pests, and that they are considered to conform to the current phytosanitary regulations of the importing country. Phytosanitary certificates are needed to import certain food products in Pakistan.
Figure 12: Phytosanitary Certificate Sample 8.2.11 Halal Slaughtering Certificate / Halal Certificate43 The Halal Certificate is issued by the Board as an assurance that a particular product has been thoroughly investigated and found to conform to the Islamic Sharia laws. The shipment of meat and any product of animal origin for import into Pakistan must be accompanied by a Halal Certificate.
Figure 13: Halal Certificate Sample
42 43
33
Canadian Food Inspection Agency TMFB
9. Key Government Agencies involved in Import 9.1 Key government agencies involved in the import of all types of products There are number of government entities or agencies who are involved in the import process in Pakistan, irrespective of the type of product. These entities or agencies are summarized with their roles in the import process and their websites in Table 11. Table 11: Key Government agencies involved in import Key government agencies Federal Board of Revenue (FBR), Government of Pakistan
Role • •
Central point of revenue collection
•
Division of the Federal Board of Revenue responsible for monitoring the movement of goods in and out of the country
•
Operating under the Ministry of Science and Technology, PQSCA is responsible for overseeing the formulation and implementation of national standard in Pakistan
Pakistan Customs
Pakistan Standards and Quality Control Authority (PSQCA)
National Tariff Commission (NTC)
Pakistan National Accreditation Council (PNAC)
34
Federal agency responsible for administration of the tax laws of Pakistan.
Website
http://www.fbr.gov.pk/
http://www.fbr.gov.pk/Office/Cust oms/38/547
http://www.psqca.com.pk/
•
Inspects and tests products and services for their quality, specification and characteristics during use, and for import and export purposes
•
NTC is the autonomous investigation authority of Pakistan with regards to trade and tariff matters
https://ntc.gov.pk/
•
PNAC operates under the administrative control of the Ministry of Science and Technology and is the central agency involved in the accreditation of conformity assessment bodies
http://pnac.org.pk/
9.2 Key Government Agencies involved in the import of Specific Types of Products There are number of other governmental entities or agencies involved in the import process in Pakistan based on the type of industry or products. A list of key entities or agencies along with the information such as the industry / product types the serve, their role in the import process, and their websites are given in Table 12 Table 12: Government agencies involved in import for specific industries Key government agencies Ministry of National Food Security and Research (MNFSR)
Department of Plant Protection and Quarantine
Animal Quarantine Department
Drug Regulatory Authority of Pakistan (DRAP)
35
•
Role
Website
Oversees the safety of food and food products that enter the Pakistan market with the help of subsidiary bodies
http://www.mnfsr.gov.pk/
•
Operates under the MNFSR and has been established under the Plant Quarantine Act 1976
•
Responsible for implementing import and export controls at 26 border inspection points for plant pests / diseases
•
Responsible for overseeing animal health conditions for import and export
•
Control the import and export of meat at border inspection points
•
Oversees the access to therapeutic goods (drugs, biologics, devices, alternate medicines, and health products in Pakistan
•
Ensures access of safety, quality, and efficacious medicines in Pakistan
http://plantprotection.gov.pk/
http://www.mnfsr.gov.pk/frmDetai ls.aspx?opt=misclinks&id=22
http://www.dra.gov.pk/
10. Key Standard Agencies and their Approval Process 10.1 Standard Agencies according to Industry Goods exported by Saudi exporters that are classified within the nine key industries identified by Saudi Exports are certified by one or more of the following agencies. 1. Pakistan Standards and Quality Control Authority (PSQCA) 2. Ministry of National Food Security and Research 3. Drug Regulatory Authority of Pakistan The matrix in Table 13 shows the industries and the standard agencies they need to approach for their certification. Table 13: Standard Agencies for Particular Industries S. No
1
2
3
Agency Pakistan Standards and Quality Control Authority Ministry of National Food Security and Research Drug Regulatory Authority of Pakistan
1
2
3
4
5
6
7
8
✓ ✓ ✓ ✓ ✓ ✓
9
✓
http://www.psqca.c om.pk/
http://www.mnfsr. gov.pk/
✓
Web Link
✓
http://www.dra.go v.pk/
Note: 1 - Building Materials, 2 - Chemicals & Polymers, 3 - Food Products, 4 – Packaging, 5 - Consumer Durables, 6 Heavy Machinery & Electronics, 7 - Precious Metals & Jewelry 8 - Pharmaceuticals, 9 - Textiles
10.2 Pakistan Standards and Quality Control Authority (PSQCA) The Pakistan Standards and Quality Control Authority (PSQCA) is the primary product certification body in Pakistan and has been accredited by the Ministry of Science and Technology. It is responsible for implementing the Certification Mark License Scheme for products entering the market for local consumption. Saudi exporters are requested to kindly visit the link provided below for more information on the complete list of products for which Compulsory Certification Licenses are to be obtained: http://www.psqca.com.pk/compulsory_items.html
The process to enroll products in the Certification Market Scheme has been detailed out below:
36
10.2.1 Process for Acquiring the Certification Mark License Scheme44 Illustration of Certfiication Mark License Scheme
I
II
Fulfillment of pre-requisites and submission of application form
Evaluation of Application
V
Issuance of Certification License and Mark
III
Factory Audit
IV
Laboratory Tests
Figure 14: Certification Mark License Scheme
= Process stage
Stage I: Fulfillment of pre-requisites and submission of application 1. Saudi exporters are requested to complete certain pre-requisites including the preparation of all documentation with regards to the certifiable products. 2. The manufacturers of the products / an authorized representative in Pakistan submits the application for the Certification Mark / License, along with the application fee. Saudi exporters are requested to kindly visit the link provided below for the application form: http://pakalerts.net/PSQ/download.html 3. The application form is to be submitted to the Standards Development Center (SDC) of PSQCA. Stage II: Evaluation of Application 44
37
PSQCA
1. Upon receipt of the application, the Certification Marks Division of SDC acknowledges receipt and allocates a registration number to it. 2. The application form is evaluated for completeness and an Inspection Schedule for the product manufacturing premises is scheduled. Stage III: Factory Audit 1. The Certification Marks division of SDC sends an inspector with a copy of the submitted application form to the respective product manufacturing premises. 2. During the preliminary factory audit, the Inspector assesses the application and the manufacturing premises against the following guidelines: •
Veracity of the application form
•
State of the laboratory facilities used for QA of the products
•
Inspection of the quality of the article at various stages of production
•
Examination of factory premises to establish alignment with Good Manufacturing Practices (GMP).
3. Further, the Inspector also draw samples (raw materials, intermediate, semi-finished, and finished products) to be send to PSQCA testing laboratories. These samples will be evaluated to ensure compliance with Pakistan national standards. Note: The Inspector might also draw random samples from products in circulation in local market, in addition to factory samples. Stage IV: Laboratory Tests 1. The laboratory testing facilities of the PQSCA / other accredited bodies clinically evaluates the drawn samples against a product specification sheet provided by the SDC. 2. The SDC retains one copy of the final test reports and sends another copy to the manufacturer for his / her records and / to rectify product defects, 3. The laboratory facilities issue a bill of testing fee to the manufacturer for the payment of all fees related to testing. Stage V: Grant of Certification Mark License 1. If the testing results show that the sample conforms to the national standards, the Director will recommend the issuance of a Certification Mark license to the manufacturer. 2. The licensee is then required to use the Pakistan Standards Certification Marks on the products responsibly to indicate conformity of product with relevant Pakistan Standards. 3. The products will be subject to periodic surveillance and random product samplings to ensure continued conformity with Pakistan standards.
38
10.2.2 Costs involved45 S. No. 1 2 3
Contents Application Form Registration Fee Laboratory Testing and Inspection Fees License fee
Cost (SAR) 36 Product-specific 178
10.2.3 Lead Time46 S. No. 1 2 3 4
Application Stage Application Form (Evaluation and Registration) Inspection and Sample Collection Laboratory Tests Grant of Certification Mark License Total
Lead Time (in days) 2 1 7 30 40
10.3 Ministry of National Food Security and Research The Ministry of National Food Security and Research is responsible for implementing, enforcing, developing, and executing policy on agriculture, rice, livestock, fishing, and farming. Its subsidiaries: Department of Plant Protection and Quarantine (PPQ) and Animal Quarantine, in conjunction with, Pakistan Customs are responsible for monitoring the import and export of food products into and from the country. Saudi exporters are requested to kindly visit the link provided below: http://www.mnfsr.gov.pk/ The process for the customs clearance of imported food has been detailed out below:
10.3.1 Customs Clearance Process for Imported Food at the Port47
PSQCA PSQCA 47 US FAIRS Country Report – Pakistan 45 46
39
Illustration of Food Customs Clearance Process I
Saudi Exporter prepares documents
II Submission of documents
for customs clearance
III
Review of documents and physical inspection at customs control
IV
Release of products to the importer
Figure 15: Food Customs Clearance Process Stage I: Saudi exporter carries out the perquisites and prepares the necessary documentation 1. All food imports into Pakistan are to be accompanied by written certification (quality certificates) from the producer and exporting country affirming that the products have been produced under sanitary conditions and in disease free areas. 2. Further, any relevant permits and licenses from the Ministry of National Food Security and Research is to be obtained prior to import. Saudi exporters are requested to kindly visit the link provided below for more information on these requirements; http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf
Stage II: Submission of documents for customs clearance 1. The importer / customs clearance agent files the Import Goods Declaration (IGD) via EDI upon arrival of the goods at the port.
40
2. WeBoc channelizes food products into red and amber lanes and the goods are then subject to further inspections and checks by Customs and the relevant food safety agencies. 3. The importer also pays all taxes and fees at this stage. Stage III: Review of documents and physical inspection at customs control 1. The goods are subject to physical inspection along with documentary verification by officials from the Customs Department and the Department of Plant Protection and Quarantine (PPQ)/Animal Quarantine Department. 2. The imports are assessed to ensure compliance with national quality and health standards, import and labelling requirements. Stage IV: Food products are released to the importer On the completion of successful inspection of goods, officials release the goods to the importer.
10.3.2 Lead Time48 The estimated timeframe for the conclusion of the customs clearance procedures is within 7 days.
10.4 Drug Regulatory Authority of Pakistan (DRAP) DRAP has been established under the DRAP Act 2012 and is a federal agency responsible for enforcing the Drugs Act, 1976. The body is expected to standardize the trade and commerce of therapeutic goods. Saudi exporters are requested to kindly visit the link provided below for more information about the authority: http://www.dra.gov.pk/
The Pharmaceutical Evaluations and Registration Division is responsible for the evaluation, assessment, and registration of pharmaceutical drugs and the process for registration of an imported drug has been detailed out below:
10.4.1 Pharmaceutical Products Registration Process49 Stage I: Appointment of an agent Saudi exporter appoints a local agent in Pakistan for the registration of the drugs. Stage II: Saudi exporters fulfills the pre-requisites and submits the registration application 1. Saudi exporters are to prepare the documentation regarding the pharmaceutical products to be registered. 2. The pharmaceutical registration application along with the aforementioned documents is to be submitted to the Regulatory Board Saudi exporters are requested to kindly visit copy paste the link provided below in the web browser for the application form used for registration of an imported drug:
48 49
41
US FAIRS Country Report – Pakistan Drug Regulatory Authority of Pakistan
http://www.dra.gov.pk/userfiles1/file/Download/Application%20Form%20for%20Registration%20of%20an%20Im ported%20Drug.pdf Further, guidance regarding the filing of the registration application and attached documentation can be accessed by copy pasting the link provided below in the web browser: http://www.dra.gov.pk/userfiles1/file/Download/Manzoor%20Bozdar%20Sb%20Section/Guidelines%20for%20authorized% 20officers%20under%20special%20SROs.pdf
Illustration of the process for registering Pharmaceutical Products I
II
Appointment of an agent
III
Saudi exporter fulfills pre-requisites and submits application form
Evaluation of application
✓
V
Registration of drugs
IV
Further evaluation
Figure 16: Pharmaceutical Products Registration process
= Process stage
Stage III: Application Evaluation (Screening Process) The Registration Board evaluates the application for veracity, completeness and relevance. In the event of the need for further investigations, the Board passes all submitted information and material to the Committee on Drugs Evaluation for further assessment.
42
Stage IV: Further evaluation Prior to registration of drugs, the Registration Board will on its own discretion require laboratory analysis, clinical trials, and Good Manufacturing Practices (GMP) of the manufacturing units. Stage V: Registration of drugs Following successful evaluation of the registration dossier and any relevant factory audits and laboratory analysis, the drug is registered and the importer is notified of the outcome. Note: Any discrepancies or failings in any stage of the pharmaceutical registration process is communicated to the exporter via his / her agent and they are given timeframes within which to undertake rectifying action.
10.4.2 Key Documents required for pharmaceutical products registration Saudi exporters are requested to kindly visit the link provided below for detailed information about the documents required for pharmaceutical products registration: http://www.dra.gov.pk/userfiles1/file/Download/Check%20list%20for%20Scrutinization%20of%20Registration%20Application%2 0%20Dossiers.pdf
11. Packaging and Labelling Regulations –Pakistan Pakistan does not have a uniform labelling regime in place and is industry-specific. 11.1 Food Industry 11.1.1 Food Industry Regulator The Ministry of National Food Security and Research (MNFSR) is the food industry regulator in Pakistan. Saudi exporters are requested to kindly visit the link provided below for more information on the regulator: http://www.mnfsr.gov.pk/
11.1.2 Labelling Requirements50 Table12: Minimum labelling requirements S. No
Category
Information requirements
1 2 3
Product Name Manufacturer’s Name and Address Net Weight Fortifying matter (e.g. Vitamins and minerals to powdered milk)
All labels must be in English o Urdu; alternatively, an English or Urdu stick-on label is also acceptable
4
50
43
US FAIRS Country Report
5 6 7
Lot number “Use before” or “Best By” date Ingredients information
11.2 Pharmaceuticals Industry 11.2.1 Pharmaceuticals Industry Regulator The regulator of the pharmaceuticals industry in Pakistan is the Drug Regulatory Authority (DRAP). Saudi exporters are requested to kindly visit the link provided below for more information about the regulator: http://www.dra.gov.pk/
11.2.2 Laws and Regulations The Drug (Labeling and Packing) Rules 1986 and its subsequent amendments oversee the labelling of pharmaceutical products in Pakistan. Saudi exporters are requested to kindly copy paste the links provided below in the web browser for more information: http://www.dra.gov.pk/userfiles1/file/docs/Druglabelingpackingrules1986.pdf http://www.dra.gov.pk/userfiles1/file/Gazettenotificationbarcodeamendments1.pdf
11.2.3 Labelling Requirements51
51
44
S. No
Category
Information requirements
1 2 3 4 5 6 7 8
Registered name of the drug Manufacturer’s Name and Address Drug Manufacturing License Number Drug Registration Number Date of expiry Name of drug dosage and instructions Batch number date of manufacture and the retail price Description of pack size
All labels must be in English o Urdu; alternatively, an English or Urdu stick-on label is also acceptable (Products to have unique barcodes)
Drug Regulatory Authority of Pakistan
12. References Footnotes 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
45
Links http://www.pakistan.doingbusinessguide.co.uk/the-guide/business-etiquette,-language-culture/ http://www.doingbusiness.org/~/media/wbg/doingbusiness/documents/profiles/country/pak.pdf https://en.portal.santandertrade.com/establish-overseas/pakistan/business-environment https://pakistan.travisa.com/Common/TVSVisaInstructions.aspx?citizenshipid=sa&countryid=pk&resi denceid=us&partnerid=ta&glid=aus&travelertypeid=BU https://www.export.gov/article?id=Pakistan-Methods-of-Payment http://www.supremecourt.gov.pk/web/user_files/File/thejudicialsystemofPakistan.pdf http://www.doingbusiness.org/data/exploreeconomies/pakistan#enforcing-contracts http://icci.com.pk/data/downloads/64/1837368141_1.pdf https://aric.adb.org/fta/pakistan-gulf-cooperation-council-free-trade-agreement http://2016.export.gov/pakistan/build/groups/public/@eg_pk/documents/webcontent/eg_pk_03364 7.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * http://www.pkrevenue.com/customs/regulatory-duty-ranging-5-15-percent-imposedincreased-on565-imported-items/ http://www.fbr.gov.pk/Office/Sales-Tax/39/130 https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * http://kcaa.pk/wp-content/uploads/2016/04/IPO_345_2016.pdf http://www.psqca.com.pk/psqca.html http://www.psqca.com.pk/psqca.html https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://www.wto.org/english/tratop_e/tpr_e/s311_e.pdf * https://ntc.gov.pk/ http://www.worldportsource.com/ports/index/PAK.php http://shipmagz.com/node/11 https://www.linescape.com/ http://www.worldfreightrates.com/en/freight http://download1.fbr.gov.pk/Docs/20101111511047546CustomsAct2010.pdf http://www.pakistancustoms.net/2016/08/Custom-Clearance-Procedure-For-Import-In-Pakistan.html
31
http://www.pakcustoms.org/import_general_manifest_igm/ http://www.pakistancustoms.net/2016/08/Custom-Clearance-Procedure-For-Import-In-Pakistan.html 32 http://www.doingbusiness.org/data/exploretopics/trading-across-borders 33 https://www.export.gov/article?id=Pakistan-Import-Requirements-and-Documentation 34 http://www.intracen.org/coffee-guide/logistics-and-insurance/bills-of-lading-and-waybills/ 35 http://www.lynden.com/lint/PDF/Shipping_Forms/Commercial-Invoice.pdf 36 http://www.globalnegotiator.com/en/packing-list-en 37 http://www.aicc.ie/saudi_arabia 38 http://www.globalnegotiator.com/international-trade/dictionary/letter-credit-lc/ 39 https://www.export.gov/article?id=Insurance-Certificate 40 http://www.globalnegotiator.com/international-trade/dictionary/certificate-health/ 41 http://www.inspection.gc.ca/plants/exports/phytosanitary42 certificates/eng/1299872808479/1299872974262 http://www.tmfb.net/halal-certification/halal-certification 43 http://www.psqca.com.pk/enforcement.html 44 http://www.psqca.com.pk/enforcement.html 45 http://www.psqca.com.pk/product_certification_process.html 46 https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 47 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 48 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf http://www.dra.gov.pk/userfiles1/file/Download/RB/Procedure%20of%20Registration.pdf 49 https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20Import 50 %20Regulations%20and%20Standards%20-%20Narrative_Islamabad_Pakistan_12-22-2015.pdf http://www.dra.gov.pk/userfiles1/file/docs/Druglabelingpackingrules1986.pdf 51 *Kindly copy and paste this link on a web browser to know more information and for updates
46
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