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Traders  & Businesses Masthead

Security Requirements & Procedure

Overview - Security Requirements
Furnishing of Security
Amount of Bank Guarantee/Insurance Bond Required
BG Indicator
Lodging of Security
Renewal of Security
Withdrawal of Security
Forfeiture of Security

Overview

Traders, or the appointed forwarding agents of the traders, are required to furnish security for transactions involving dutiable goods.

Security is also required for the operation of licensed warehouses and excise factories, for repairs, conversion or exhibitions.

The security furnished shall be in the form of a bank/finance company guarantee or insurance bond.

No security is necessary for transhipment of dutiable goods under "through" bill of lading/airway bill except for transhipment of liquors and tobacco (including cigarettes) by external delivery.




Furnishing of Security

Upon registration, a company is required to furnish a bank/finance company guarantee (BG) or insurance bond as security to cover:

  • the potential duties involved for its transactions of dutiable goods; and
    the potential GST on its temporary imports of non-dutiable goods.
  • The insurance company which issue insurance bond must be registered with Monetary Authority of Singapore (MAS) under the Insurance Act. The company must be either a direct general or direct composite insurance company listed under MAS "Directory" of Financial Institution".




Amount of Bank Guarantee/Insurance Bond Required

Dutiable Goods

For each import, export, transshipment and removal of dutiable goods, the amount of bank guarantee/insurance bond required is: 

In-Non-Payment Permits (excluding Temporary Import Permits) and Transhipment Permit (Excluding Transhipment with Through Bill of Lading):

  • 50% of the potential duty for liquors and tobacco (except leaf tobacco), or
  • 10% of the potential duty for motor vehicles.

Temporary Import Permits

For the temporary import of dutiable motor vehicles for repairs, exhibition and other approved purpose, the amount of bank guarantee/insurance bond required is:

  • 30% of the potential duty and GST payable on the motor vehicle if the importer is GST-registered, or
  • 50% of potential duty and GST payable if the importer is not GST-registered.

In-Payment Permits:

  • 100% of the duty if the duty payment involved in a consignment which exceeds $2,000/-.


Non-dutiable Goods

Temporary Import Permits

For temporary import of certain selected non-dutiable goods such as jewellery, precious stones, handbags, garments, antiques, watches, etc. for repairs and other approved purposes, the BG/insurance bond required is:

  • 50% of the potential GST payable on the selected goods if the importer is GST-registered, or 
  • 100% of the potential GST payable on these selected goods if the importer is not GST-registered.

Please click here ( PDF 276kb ) to view the list of the selected goods subject to this requirement.

For the temporary import of all other non-dutiable goods, the amount of bank guarantee/insurance bond required is:

  • 30% of the potential GST for exhibition with sales/auctions, repairs and other approved purposes for GST-registered companies, or

  • 50% of the potential GST for exhibition with sales/auctions, repairs and other approved purposes for non-GST registered companies.

Under the Declaring Agent Governance Framework, declaring agents with a better banding will get to enjoy lower or waiver of BG requirement. For more information on the Declaring Agent Governance Framework, please refer to http://www.customs.gov.sg/leftNav/trad/Declaring+Agent+Governance+Framework.htm.
 

Other Considerations

No security is required for:

  • import, export and transshipment of unmanufactured leaf tobacco, transhipment of dutiable goods under 'through bills of lading' within the same free trade zone (FTZ),

  • transhipment of dutiable goods other than liquors and tobacco under 'through bills of lading' through Customs territory,

  • inter-gateway movement of LCL containers for unstuffing of cargoes in the FTZ, and

  • blanket permits issued for petroleum products.




BG Indicator

A declaring agent, in submitting a TradeNet® declaration to Customs, may opt to use the importer's banker's guarantee/insurance bond by selecting 'I' (for importer) for the BG Indicator.

However, the declaring agent must be authorised by the importer for this purpose by using the 'Authorisation of Declaring Agent' form available under 'Online Forms' at the
TradeXchange website.




Lodging of Security

The security, in the form of banker's guarantee/insurance bond, must be lodged on the prescribed formats downloadable at the Customs website. The form "Banker's Guarantee/Insurance Bond Specimen (Permits)" ( DOC 39.5kb ) is meant for lodgement of security to cover permit declarations only, while the form "Banker's Guarantee/Insurance Bond (Licensed Premises)" ( DOC 40.5kb ) is meant for lodgement of security in respect of Customs permit declarations and operation of licensed premises.

The original banker's guarantee/insurance bond should be sent by post to: 
                                   
                                    
Head Procedures & Systems
                                            Singapore Customs
                                               55 Newton Road
                                        #07-02 Revenue House
                                            Singapore 307987




Renewal of Security

The minimum validity period of a banker's guarantee/insurance bond is normally one year. Before expiry of banker's guarantee/insurance bond, Customs will inform the company to renew the security. The company should then arrange with its bank/finance company for a new banker's guarantee/insurance bond to be submitted to Head, Procedures & Systems Branch. The expiry date of a banker's guarantee/insurance bond should be at year-end (i.e. 31 December).




Withdrawal of Security

If a company wishes to withdraw its banker's guarantee/insurance bond, it should inform Customs in writing. The banker's guarantee/insurance bond will be returned to the company when it has been confirmed that the company has no outstanding matters with Customs. Expired securities will not be returned to the banks/insurance companies.

 

Forfeiture of Security

Companies, in particular Declaring Agents, should exercise due diligence in allowing their security to be used for another entity’s goods during permit declarations. The security or any part thereof may be directed for forfeiture by Singapore Customs if Singapore Customs is satisfied that the company has failed to comply with any conditions specified in respect of security required to be furnished under Section 81 of the Goods and Services Tax Act, Regulation 6(c) of the Regulation of Imports and Exports (Chewing Gum) Regulations or Section 99 of the Customs Act.




Frequently Asked Questions

For FAQs on customs matters, click here


Customs Circulars

For Circulars on customs matters, click here.


E-Learning Courseware

For e-learning to the ‘Guide to Customs Procedures’, click here.



Last reviewed on 15 April 2014
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