Germany is one of Europe’s most powerful nations, both economically and politically, boasting a gross domestic product in 2019 of approximately €3,435.76 billion. Germany is also the third largest export economy in the world, primarily exporting its goods to France, the Netherlands, the UK, the U.S. and China.
The European nation plays an important role for Australia, being our fifteenth largest trading partner last year. Most of Australia’s imports from Germany include cars, medicine, pharmaceutical products and vehicles.
So how do you import from Germany? Below, we’ve put together a concise guide on everything you need to know about importing from Europe’s strongest economy. We’ll discuss everything from administrative requirements and documentation, to tax implications and legal obligations.
1. Find the right import
First and foremost, you’ll want to make sure you’re importing something worth your while – something that your business can sell to your target market. Research the German market and find a product your customers will love.
The motor industry is a prime example of German import success in Australia. In 2016, it was reported that the Australian demand for German cars was soaring. For the first time in the country’s history, the Federal Chamber of Automotive Industries found that the sales for German cars surpassed those made in Australia. Out of the approximate 1.18 million cars sold in Australia in 2016, 87,392 of those cars were built in Germany. Popular brands including Audi, BMW, Porsche and Mercedes-Benz all reported record numbers of Australian sales.
For more information on this topic, consider reading our blog on starting a successful import business.
2. Ensure your imports aren’t prohibited
Once you’ve found the perfect product to import, make sure that the goods are legal. The Australian Border Force are rigorous in their enforcement of customs regulations prohibiting certain goods into the country. In September 2020, a man was charged for illegally importing firearms from a range of countries, including Germany.
We’ve put together a handy guide on what products are prohibited from entering Australia.
3. Assess the biosecurity risk
The Department of Agriculture, Water and the Environment are responsible for ensuring Australia’s biosecurity, and will inspect declared goods that present potential biosecurity threats to the Australian population and its natural environment.
If you’re planning to import particular commodities from Germany into Australia, you may be required to obtain an import permit. These are granted by the Department through the Biosecurity Import Conditions (BICON) system. To find out if you need a permit for your import, we strongly advise checking the BICON database.
4. Know the customs duties
Any goods you import from Germany into Australia will be subject to customs tariffs at the Australian border. Your cargo will need to be classified correctly under tariffs legislation so that the appropriate tariff (and customs duty) is applied and you pay the correct amount.
A failure to properly classify your goods may not only result in the incorrect charge being imposed, but also potential penalties.
You’ll therefore need to find what’s called the correct Harmonised System (HS) Code, and detail it on your commercial invoice. You can use the tariff to calculate your customs duty. It’s important to do this early in the importing stage, so you know what to expect when the time comes.
For more information, make sure you read our ultimate guide to customs tariffs in Australia.
5. Locate the right supplier
There are scores of exporters in Germany ready and willing to tap into the Australian market. Some of the country’s top exporters include Adidas (apparel), Bayer (medical goods) Siemens (engineering), the BMW Group and Volkswagen (vehicles).
Finding the right supplier can be a lengthy process. We recommend you research the available suppliers in depth. Request quotes from each of the suppliers you find, including whether or not there is a minimum order quantity (MOQ). Compare each supplier – not only their price, but their service and their reliability.
See how willing they are to negotiate – you’ll want to make sure your purchase is governed by the appropriate Incoterm (these are international terms of trade identifying the agreed risks between buyers and sellers).
We’ve put together a concise step-by-step guide on finding the right international suppliers and partners for importing goods into Australia.
Once you’ve found the perfect supplier in Germany, place your order.
6. Gather the paperwork
When you’re shipping goods from Germany, there’s a lot of paperwork.
We suggest requesting a proforma invoice for your purchase before you order, so you can confirm the HS codes as well as the description of the goods. The invoice should also show the exact weight and dimensions of the product you’re buying.
Other documents you’ll need for your shipment include a:
You can read more about each of these types of documents by clicking on the links provided.
7. Pay for your goods
The next step will be to pay for your goods – because you’ve already mastered step #4, customs duties won’t be a shock to you.
Aside from those, you’ll also need to pay Goods and Services Tax (GST) on most imported goods from Germany. This will amount to 10 per cent of the AUD value of the goods at the time they are imported.
You may be able to defer paying GST if you participate in the Australian Government’s Deferred GST scheme. You can read more about this scheme in our other article on the topic.
8. Organise transport
How will your goods move from Germany to Australia? Check if your supplier will offer air freight or sea freight, and assess which option is best for you.
Shipping by sea takes much longer (approximately 35 days from Hamburg to Melbourne via Port Kelang), but it’s also much cheaper than paying for air transport. You also risk delays with ocean freight, especially if you’re importing during the shipping peak season.
COVID-19 has led many importers to use air-sea solutions for their shipments, an alternative way to import goods using a combination of both ocean freight and air freight.
Because the price of air freight has skyrocketed, we at International Cargo Express have developed a unique solution for our importers. We can fly your products from Germany to Singapore by air, and then ship them to Australia by sea. With weekly flights from Frankfurt to Singapore and weekly sea freight departures from Singapore to Australia, your cargo can reach Australia in just 27 days for 50 per cent of the cost.
8. Receive your shipment
The final step is to receive your shipment when it arrives in Australia.
Your goods will first need to be cleared by customs when they arrive at port and, if any problems arise, your customs broker will be able to support.
Once your goods have cleared, you can get them delivered to your store or warehouse via a truck (such as a sideloader or a live unloader). Investigate your options with your freight forwarder to find the best solution for you.
A German-Australian Free Trade Agreement?
Unfortunately, there is no bilateral free trade agreement between Australia and Germany.
However, in June 2018, negotiations began between Australia and the European Union for a new free trade agreement. We expect such an agreement will bring many benefits to Australian importers given that the EU is Australia’s third largest trading partner.
The Department of Foreign Affairs and Trade estimate that an Aus-EU trade agreement could potentially open up a market for Australian goods and services worth a GDP of US$15.5 trillion. It would also allow Australian exporters to tap into a huge EU export market.
Questions? Engage the Experts
At International Cargo Express, our expert freight forwarders have helped many Australian importers get the best deals with German suppliers and transport providers.
The German trade lane has been a cornerstone of our success over the past 30 years and, with a number of German trained and speaking staff, we can confidently say “We know Germany”. Our German affiliate, Senator International, has an established and wholly-owned network with 15 offices in major German trade centres.
With depots across Germany and weekly sailings, we can accommodate any requirement you may have with our tailored made packages.
Our sea freight services include:
- Pick-up, packing and buyer’s consolidation;
- FCL contract rates;
- Weekly LCL services;
- Door to door shipments;
- Port handling and inland transportation; and
- Project shipments.
We also offer premium air freight in just 24 hours (or 36 hours if you’re looking for a more economical solution).
Engage the professionals to handle the freight forwarding, so you can focus on doing what you do best. If you have any questions about how to import from Germany, feel free to ring us at any time.
or call us on 1300 227 461