What is an import licence?

An import licence is an official document issued by a nation’s government.

It authorises particular goods and services to be imported into its territory, an import licence might be required for your import business. According to Gov.UK, certain goods are controlled by import licences and these include, but are not limited to:

  • Technology
  • Military weapons
  • Textiles
  • Artworks
  • Plants
  • Animals
  • Medicines
  • Chemicals

Product licensing takes many forms. The main type of import license is general and permits the unrestricted importation of goods included in the licence lists for a certain period of time.

You might even need an import licence when goods will only be in the country on a temporary basis. A one-time license may indicate the following:

  • A quantity of goods
  • The goods’ cost
  • The goods’ country of origin (or destination)
  • The customs point through which the import of goods should be carried out

Why are imports essential?

There are many reasons why importing is as crucial as exporting to different countries around the world, but the main reasons can be summarised as:

  • Availability – There are some things that can’t be grown or produced in certain countries. For example, bananas in Alaska.
  • Cachet – Products like caviar and Champagne have a higher level of prestige if they’re imported rather than home-grown. For example, Scandinavian furniture, German beer, French perfume and Egyptian cotton. Even when a country can produce domestically, products are considered exclusive and more authentic when they come from a foreign country – especially if it’s where they originated.
  • Price – Some products are cheaper when brought from another country and imported. Toys, electronics and clothing can often be manufactured or assembled in other countries for far less money than if they were made in the UK.

Countries will usually export goods and services that they can produce inexpensively and import those that are produced more efficiently elsewhere. What makes one product less expensive for one nation to manufacture than another? Two factors: resources and technology. For example, a country with extensive oil resources and the technology of a refinery will export oil but may need to import clothing.

What are tariffs and non-tariff barriers?

When goods enter a country, there are other obstacles besides import licences that they may face. Goods normally acquire tariffs and non-tariff barriers, which are decided and enforced by the government of the country that the goods are entering. Both are used by governments as a way to discriminate against another country’s goods in order to protect a domestic industry from foreign competition.

A tariff is a tax on imports and exports between countries.  A non-tariff barrier is an obstacle to trade that isn’t a tax or duty. Examples of non-tariff barriers are: quotas, regulations on quality or licencing.

Each country has their own restrictions on goods, or certain goods, so if your business is considering importing (or exporting) goods, you’ll need to check if you need a licence. To stay on the right side of the law, you should be aware of your import licensing responsibilities and know who the relevant UK licensing authorities are.

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