Freight value on bills of lading and invoices

In Brazil, it is a legal and tax requirement to declare the freight value on import bills of lading and commercial invoices

Among other mandatory information, the ancient but still in force Brazilian Commercial Code stipulates that the bill of lading covering imports into the country must include the freight value and place of payment.

The freight value is necessary to calculate the Adicional ao Frete para Renovação da Marinha Mercante – AFRMM (Freight Surcharge for Renewal of the Merchant Navy) for cargo clearance. The AFRMM, payable by the importer, is calculated as a variable percentage of the freight added to other cargo handling expenses, ranging from 8% to 40% of the aggregate amount. This surcharge does not apply to exports or cabotage, except for solid and liquid bulk cargoes carried within the North and Northeast regions.

The evidence of freight value is the amount stated on the B/L. If the shipper has not declared it or no freight has been charged, tax authorities will calculate the applicable AFRMM and other import taxes following regulatory parameters.

According to relevant customs regulations, the commercial invoice, in turn, must indicate the freight value to determine the corresponding import taxation or exemption.

The cargo and freight values will be shown compulsorily in the Brazilian electronic bills of lading (CT-e) in the cabotage trade.

While the Brazilian legal framework requires that importers declare the amount of freight payable in commercial invoices and bills of lading for taxation purposes, the mere mention of the freight value in the latter does not turn it into an ad valorem B/L. Therefore, it does not impose more onerous liability terms than those mandated by applicable law.

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