Transport & Logistics Focus
Ahmed HashemSenior Associate,Transport & Insurance
Jamal Natto Associate,Transport & Insurance
The Kingdom of Saudi Arabia is focusing on progressing towards an improved method of accelerating the stages of development related to Digital Transformation. Amongst these transformations, automation of the import process had important consequences for the operational efficiency of markets; increased computational speed that allowed easy handling of the containers and getting the proper approvals in a short time.
With the above outlook, it leads us back to the questions “The E-process requiments for the imported products in the KSA and what are its key challenges?” To give a concise answer we will highlte the E-process requiemnts in Saudi Arabia and the legal consequences in case of non-compliance.
As a rule of thumb, before a consignee places an order to the exporter, the products to be imported in KSA must already be registered. Product registrations are facilitated through several e-platforms such as SABER, ECOSMA or FASEH, and may take up months to complete depending on the availability of the requirements. Such registration platforms are linked to FASAH to maintain electronic processing and validation of conformity assessments.
Meanwhile, one of the main challenges on the clearance process is occurred due to the failure to comply with the legal requirements where it explicitly requires certain documents to be prepared and provided before the relevant authorities, as well as registration before relevant electronic platforms. In such cases, non-conforming shipments may be subjected to demurrage as charged by customs, detention as charged by the shipping lines, re-export upon request before the item is auctioned, or auctioned at worst.
Any products entering the Saudi Market are well regulated and undergoes a safety check from product registration to assessment through the SALEEM program which is managed by Saudi Standards, Metrology and Quality Organization (SASO).
In Arabic, SALEEM indicates that the product is safe, secure, and free of flaws that may harm individuals, society, or the environment (QIMA, 2022). SALEEM program aims to ensure that the products entering the Saudi Market are safe and in compliance with relevant standards.
Under SALEEM is SABER. SABER is an electronic platform that helps the local supplier and factory to electronically register the required conformity certificates for consumer products to enter the Saudi market and aims to develop the highest standards of efficiency to speed up the registration procedures (SASO, 2022). All importers and local manufacturers with Saudi Commercial Registration are required to register in SABER. The platform has no subscription fee and the opening of such account is free.
For importers and local manufacturers to obtain Certificates of Conformity which comes in two forms – Product Certificates of Conformity (PCoC) and Shipment Certificates of Conformity (SCoC) – they shall request it through SABER system as per the three steps that follows.
The first step in SABER system is product registration. Here, the user inputs the details of the products into SABER and the system verifies, based on the item’s HS code or product category, if the item is regulated or not.
HS Code refers to the international coding system for the classification of products which are imported or sold in the Saudi Market. It standardizes product identity and it could be obtained by visiting the e-platform of Zakat and Customs Authority official website. The international HS Code is a six digits code whereas comparatively, the Unified Gulf Cooperation Council's HS code has eight digits. With a universal structure in mind, the Saudi customs created a new HS code integrating both the international system and the Gulf system, concluding at a twelve digits HS code where the first six digits matches the World Customs Organization's HS Code.
As per SASO announcement, the Product needs to be registered based on HS Code in:a. SABER for Regulatory Products (through TUV / Intertek / SGS Outsource only)b. SABER for Non-Regulatory Products c. ECOSMA for Cosmetic Products
Points “b” and “c” above can be generated in house or outsourced.
The second step in SABER system is product categorization based on risk level. Risk level is driven by two variables, HS code and product categorization. Non-regulated products, a.k.a. low risk products, are items that are not regulated by Saudi Arabian Technical regulations that needs to only submit Self Declaration with document supports according to the approved forms of SASO.
On the other hand, Regulated products, a.k.a. Medium/High risk products, are those that needs to obtain Product Certificates or Type Approval Certificates which are issued by SABER system after proving compliance with relevant standards. Power driven machineries are part of regulated products and Product Certificates are valid for one year.
For products exporting from Asia, Australia, Europe, America, Middle East, and North African Countries, QIMA is one of the approved conformity Assessment Bodies authorized to issue Product Certificate of Conformity (PCoC). Different Conformity assessment types are required determining which activities are required. The relevant activities include product testing, inspection, factory inspection, audit, surveillance factory audit.
The third step in SABER system is to obtain Shipment Certificate of Conformity (SCoC). This applies to all products, regulated or not, and is valid per consignment. It requires self-declaration, for non-regulated items, or Product certificates, for regulated items. It also requires shipment documents such as invoice, bill of lading etc. In the absence of SCoC, any shipment to Saudi Arabia is required to be re-exported. Re-export means that the products shipped to KSA need to be sent back to its source location or the original shipper and that the consignee who needs to re-export the container shall write a letter to the port for re-export.
The unified digital platform for the import and export system which aims to facilitate international services by automating the import and export procedures is called “FASAH” (FASAH, 2019). On 1 July 2020, the SABER platform was linked with the FASAH system and with such integration, there is no longer needed to print a SCoC as it will automatically be in the FASAH system.
Contrary to the notion that the clearance process starts upon the container’s arrival at the port, close communication for clearance purposes shall start once the shipment departs from the port of loading. This means that to facilitate speedy clearance, once the shipment departs from port of loading, the supplier shall provide a copy of the documents to let the consignee prepare for customs clearance. In case there are missing documents, consignee shall submit an undertaking letter to avoid moving the container in customs to Abandoned Area. The ports have the right to move containers to Auction Area automatically without a need to provide any notice from 15 to 30 days after vessel arrival in case of insufficient documents and untimely submission of the requirements. Given these, the consignee shall be ready with all the proper and complete documents four to five working days before the vessel arrival to avoid destruction or auction and ensure that there will be no business interruptions.
In summary, there is a structured procedure to be followed in importing to KSA and the primarily challenge in import is the non-compliance to legal requirements. To minimize the financial exposure associated with importation, and to ensure a smooth clearance and absence of avoidable costs, the exporter and consignee shall ensure that the product is registered before shipping, and that requirements are dealt with accordingly in a timely manner.
For further information, please contact Ahmed Hashem or Jamal Natto.
Published in November 2022
