There are grumblings from the F1 circus in the run-up to the Indian Grand Prix about the country’s customs because teams are worried that they will have trouble flying in new parts for the weekend. This seems to involve a great deal of paperwork. The system in India is such that the Sports Ministry should issue a certificate that allows the Customs Department to issue customs exemptions for the equipment brought by competitors, but only if there is a guarantee that all equipment imported will be exported again. In the case of F1, the ministry decided that the event was “of no national importance” – a scandalous decision – which meant that the race promoter had to pay temporary import duty, which was returned – after an administration fee had been paid.
What I fail to understand is why any of this is necessary. India is a signatory to an international customs convention for the temporary admission of goods. This means that someone wishing to import and export goods can use an ATA Carnet that allows them to temporarily import goods without payment of normally applicable duties and taxes, including value-added taxes. The carnet eliminates the need to purchase temporary import bonds. So long as the goods are re-exported within the allotted time frame, no duties or taxes are due. The process is administered by the World Customs Organization and acts as an international guarantee. There are 71 countries that are signed up to the system, with almost all the Grands Prix covered by the system.
F1 equipment would come under either “professional equipment” or “goods for use at exhibitions and fairs”.
The process involves submitting an application and suitable collateral, in the form of a bond, in one’s own country, listing all the goods being moved and the countries that will be visited, and then a carnet will be issued for a year and all the foreign customs officials have to do is to stamp the necessary pages and keep a record of the movement of the goods. At the end of the year the goods related to the carnet are checked and if there are discrepancies the bond takes care of any duties required.