The Israeli “Not Stopping at the Port” reform, amending the Import and Export Order [New Version], 1979, came into effect on July 1, 2024. This reform, led by the Israeli Ministry of Economy and Industry, is part of the “What’s Good for Europe – Is Good for Israel” initiative. It allows free import of thousands of products without port delays for inspections and approvals.
Key Changes
- Many products requiring compliance with official standards can now be imported without submitting an application for goods import.
- Importers only need to declare products meet official standards, similar to European practices.
- Customs agents must enter specific exemption codes in the Global Gateway system.
- Importers must retain a declaration and product file with all necessary documents related to the goods.
- The Standardization Commissioner’s guidelines for importing goods subject to official standards have been updated.
- An exemption request under section 2(c)(2) cannot be submitted for goods in Import Groups 2 or 3.
Exemption Codes
The reform introduces several new exemption codes:
– Code 60: For goods in import groups 2 or 3
– Code 61: For goods intended for export
– Code 62: For goods intended for research and development
– Code 63: for non-applicable standard, intended for goods in groups 2 or 3
Focus on Code 60
Code 60 is particularly significant as it applies to a wide range of consumer products in groups 2 and 3. When entered by a customs agent, it indicates:
– The importer declares compliance with relevant official standards
– The goods can be released for marketing without port inspections or approvals
While streamlining the process, Code 60 doesn’t exempt importers from maintaining proper documentation, which may be subject to post-import inspections.
Scope and Impact
- Applies to most imported products subject to official standardization.
- Covers items like household appliances, electronics, toys for children over 3, and many more.
- High-risk products (LPG products, fire extinguishing equipment, baby products, etc.) will still undergo strict inspections.
- Aims to reduce import costs, increase competition, and offer more product variety to consumers.
Implementation
- The Ministry will increase staff to manage risk and ensure product safety.
- A special hotline and online inquiry form are available for importers’ questions.
- A transitional order is in place from July 1 to August 31, 2024, for goods previously eligible for exemption from document presentation (2c2 approval).
- The Free Import Order, 2014 was amended on June 18, 2024 to reflect the current law.
Economic Impact
- Reduced import costs and bureaucracy.
- Increased market competition.
- Wider product variety.
- Improved business efficiency.
- Potential price reductions, especially for small appliances and hygiene products.
Minister Nir Barkat stated this is a “historic day” in fighting monopolies and cartels, aiming to bring Israeli prices closer to European levels. He emphasizes that “There is no reason for Israeli citizens to pay several times more than European citizens for identical products”.
Advice for Importers
- Draft internal enforcement procedures to ensure compliance with legal requirements.
- Maintain required declarations and product files.
- Familiarize with the new exemption codes and their applications.
- Utilize the Ministry’s hotline and online inquiry form for questions about the reform.
How to Prepare? Written Procedures
- Preparation of written procedures.
- Ensuring compliance with requirements – deepening understanding of applicable standards.
- Ensuring compliance with requirements – sampling shipments, visual inspection, strict manufacturer declarations.
- Examination of test certificates.
- Method of submitting declarations and documents in the system (who is authorized? internal control).
- Product file retention procedure (who is authorized? where and how is it stored).
- Audit/enforcement/knock on the door procedure.
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The content in this communication is provided for informational purposes only and is not intended to be comprehensive. It does not serve to replace professional legal advice required on a case by case basis.
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For further questions, please get in touch with:
Gill Nadel, Co-Head of the Tax Department – Import, Export and International Trade
