Import Duty Exemption on Machinery &

Equipment and Raw Materials /

Components

DATE : 26 SEPTEMBER 2016 (MONDAY)

VENUE : PERDANA HALL, LEVEL 10, MIDA

2

Types of Application for Import Duty Exemption

Self-Declaration Mechanism for Import Duty Exemption on Machinery & Equipment (SPM1/2015)

Import Duty Exemption for Raw Materials & Components (PC2)

Common Mistakes by Applicant

Spare Parts & Consumables

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Scope Of Exemption Eligible Applicant Form To Be Submitted

Import duty exemption on machinery and equipment excluding spare parts and consumables Exemption to be claimed through the Customs Duties (Exemption) Order 2013

Manufacturer in Principal Customs Area

Application to obtain the confirmation letter as a manufacturer must be submitted online using the form SPM 1/2015 - Manufacturer in PCA

Import duty exemption on raw materials and components used directly in the manufacture of finished product(s)

Manufacturer in Principal Customs Area

Application must be submitted to MIDA using the form PC2/PC2A (New and Extension) and PC2-1 (Additional Quantity)

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SPM1/2015

Improve business efficiency Confirmation letter issued once by MIDA valid until

31/12/2017

Permission to claim the exemption can be obtained within a period of two (2) weeks from Customs

No necessity to use the bank guarantee facilities for the clearance of goods

No necessity to redeem the bank guarantee

No additional costs incurred

Self-declaration and self-regulated

have enjoyed the facilitation up to 15 September 2016

WHY SELF-

DECLARATION

MECHANISM??

Scope of Exemption & Criteria to Qualify for

the Exemption

Eligible Sectors Scope of Exemption

Customs Duties

(Exemption) Order 2013

Qualifying Criteria

Manufacturers

in Principal Customs Area

(PCA)

Import duty exemption on machinery and equipment excluding spare parts and consumables imported or purchased from a Licensed Manufacturing Warehouse (LMW), Bonded Warehouse or Free Zone (FZ)

Under item 115

The machinery and equipment, must be new, unused and directly used in the manufacturing process of the finished product(s) at the approved manufacturers’ premise(s)

Procedure To Claim Exemption Under The Customs

Duties (Exemption) Order 2013

STEP 1 : APPLICANT

Submit the following form online via https://jpc.online.mida.gov.my to obtain the confirmation letter from MIDA:

SPM 1/2015 - Manufacturer in PCA

STEP 2 : MIDA

Accept complete application form and supporting documents

Issuance of the confirmation letter via online

STEP 3 : APPLICANT

View and download the confirmation letter via https://jpc.online.mida.gov.my/midawebpki/checkStatus.jsp

Provide complete information on the machinery and equipment to be imported in Appendix I, downloaded via

http://www.customs.gov.my.

Submit the following documents to the State Customs Control Station (Industrial Section) to obtain the permission to import

the machinery and equipment:

Company’s covering letter

Confirmation letter issued by MIDA

Appendix I (hard copy and soft copy)

STEP 4 : STATE CUSTOMS CONTROL STATION (INDUSTRIAL SECTION)

Accept complete Appendix I and supporting documents

Verify the confirmation letter issued by MIDA and other company’s document via https://jpc.online.mida.gov.my/SMPCMIDA

Issuance of the permission letter for the importation of the machinery and equipment

STEP 5 : APPLICANT

Submit the permission letter to the Customs Import/Export and Border Control Branch for the clearance of goods

Notify MIDA and the related State Customs Control Station (Industrial Section) when a company ceases operation or winds up

Form, Letters & Appendices

Customs Permission Letter

Appendix B

Confirmation Letter

Appendix A Appendix I

SPM1 Form

Documents To Be Submitted For SPM1/2015

1

2

3

4

Documents To Be Submitted For SPM1/2015

5

6

7

Import Duty Exemption for Raw

Materials & Components (PC2)

Year 2014

2015

2016

(Jan-

Sept)

Total

Applications

Received from

Plastics and

Mould & Die

Industries

224 229 149 602

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Scope of Exemption Qualifying Criteria

Import duty exemption on raw materials / components

Directly used in the manufacturing activity(s) at the approved premise(s) and subject to local availability

Total duty exemption applied & forgone : > RM5,000 (subject to changes)

Application must be submitted before the materials are imported

Type of Application

New / Extension

Additional Quantity

Appeal

Post Approval (Amendments on

Approval)

Current Form PC2 PC2-1 Company’s letter with

justification & supporting documents

Company’s letter with justification &

supporting documents

Mode of

Submission

o Online

o Physical (Courier/By

hand)

o Physical (Courier / By hand)

Forms To be Submitted

Guideline & Procedures for Application 1 Import duty exemption on raw materials and components used directly in the production of

finished products and imported directly can be considered for manufacturing companies.

2 As a prerequisite, manufacturing companies are required to register with the Department of Occupational Safety and Health (DOSH)

3 Only applications for total duty exemption of RM5,000.00 and above (per submission) will be considered for exemption.

4 Applications must be submitted before the raw materials or components are imported or purchased.

5 Documents to be submitted: a) Application form b) Manufacturing Licence (ML) or Letter of exemption from ML (ICA10) c) Tax incentive approval under Promotion of Investment Act 1986 (PIA) or Income Tax Act

1967 (if applicable) d) Memorandum and Articles of Association or Business Registration Certificate (new

application) e) Other licences/permits/approvals from relevant approving authorities f) A copy of previous approval (extension application)

6 Applications should be submitted using Form PC2/PC2-1/PC2A in two (2) copies.

7 Online applications should be accompanied by scanned copies of documents as in para 5. Signed copies of the application forms should also be submitted to MIDA.

Form, Letters & Appendices

Approval Letter

Appendix I Appendix A

PC2 Form / PC2A / PC2-1

Step 1 • Submission of application through online/physical form

Step 2 • Accept complete application and issued acknowledgement letter

Step 3 • Evaluation by the processing officer

Step 4 • Decision made in the JPC2 meeting

Step 5 • Notify company on the decision through email

Applicant

MIDA

MIDA

JPC2 Committee

MIDA

Process Workflow

No Common Mistakes for SPM1 Application

1 Incomplete documents: - Manufacturing Licence (ML) - Registration Certificate or Letter of Acknowledgement from DOSH - Latest print out of SSM Company Profile

2 Project Cost / Equity Structure - Should state the figure instead of percentage

3 Finished products and factory address different from the details stated in the Manufacturing Licence

4 Company did not apply Manufacturing Licence or ICA10

5 ROC is not the same as in the SSM Company Profile

No Common Mistakes for PC2 Application

1 Incomplete attachment for new application - Manufacturing Licence / ICA10

2 Do not provide a copy of previous approval (for extension application)

3 Incorrect unit of measurement

4 Do not provide information on the previous importation and consumption (for extension application)

5 Maximum capacity is based on the current production

6 Incorrect application form used OR Old application form

7 Declaration page is not complete

8 Illogical input / output ratio

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Malaysian Investment Development Authority (MIDA) Tel : 603-22673539 Fax : 603-22745156 E-mail : tarif@mida.gov.my Website : www.mida.gov.my