Uruguay is a country that’s become known for the number of classic used automobiles that line its roads. For this reason, it may at first become the apple of a U.S. exporter’s eye, he or she looking to capitalize on what clearly must be a lucrative market. However, before you head to an online car auction to find vehicles to export and then import into Uruguay, take pause. Uruguay has incredibly tight restrictions on the importation of used cars. In fact, it may not be possible for many to import a used car into the country at all.
That said, there are certain ways around Uruguay’s tight restrictions placed upon the importation of used for the United States and elsewhere. Below, we’re going to review what the exceptions to these restrictions are. In addition, we’ll go over the various steps you would need to undertake in order to import a used U.S. vehicle into Uruguay, should you be able to avail yourself of these exemptions. Finally, we’ll talk a bit more about the used car market in Uruguay and what – if any – opportunities exist for the savvy used car exporter / importer.
Uruguay’s Ban on Used Car Imports
As mentioned, Uruguay has incredibly tight restrictions when it comes to the importation of used cars from the United States and elsewhere. By presidential decree, all used cars, busses, trucks, motorcycles and other vehicles are banned from being imported into the country. This ban may expire at some point, however, it is currently renewed every 180 days by the government on a rolling basis. This ban does not extend to used and / or refurbished auto parts, however.
This ban is not as iron-clad as it might at first appear, though. There are several notable exceptions. Of most interest to the would-be auto importer in Uruguay is that special exemptions are made for sports cars and classic automobiles that are more than 20 years old. (Note that age is determined by date of manufacture and not by date of sale).
Additionally, Uruguayan citizens are permitted to import one used car every three years provided they meet a certain list of criteria:
- The citizen must have spent at least three years living abroad.
- The vehicle must have been owned by and registered to that citizen for a period of at least three years.
- Direct authorization from the Ministry of Finance must first be obtained before the vehicle can be imported.
While the above exemption for Uruguayan citizens to the ban on imported used automobiles won’t be of much use to most, it’s certainly there if it’s something that you can potentially take advantage of.
Buying a Used or Salvage Car at a U.S. Auction
For an importer / exporter looking to take advantage of Uruguay’s used car market, U.S. used automobile auctions can be an excellent place to start. Through these auctions, one stands to get an incredible deal on 20 years or older classic or sports cars (which can then be imported into Uruguay). In fact, some have found that they’re able to save as much as 70 to 80 percent on the actual value of such vehicles, something that will come in handy given the high tariffs and taxes applied to used vehicles that can be imported into Uruguay.
Of course, most used vehicle auctions in the United States are restricted to those who have dealer’s licenses. Thankfully, there’s a way around this! Through online used car auctions, anyone can gain access to an incredible array of used and salvage vehicles that can be repaired and then imported into Uruguay. Best of all, U.S. online car auctions are incredibly easy to participate in, no more difficult than an online auction for any other product.
To get started, you merely need to set up an account and then make an initial deposit. This deposit establishes your bidding power, with the deposit typically representing 10% of your maximum bid. For example, if you were to make a $600 deposit, you would then be eligible to bid up to $6000 on a used or salvage vehicle.
Once an account has been setup and a deposit made, you will be free to peruse the online used car auction site’s inventory. In addition, you’ll be connected with an agent or broker who can assist you throughout the auction process. You’ll definitely want to get in direct contact with this agent or broker, as he or she will be able to grant you access to their inventory of vehicles that cannot be displayed publically. When looking to import used U.S. vehicles into Uruguay, this will be particularly important, as there is an incredibly limited subset of vehicles that will be eligible for import in the first place.
Arranging for Shipment to Uruguay
Most major United States ports offer shipping services to Uruguay. You’ll merely need to check with the ports of your choice to verify availability. In addition, you’ll also have the option of choosing between normal container shipping or something that’s known as RORO shipping, RORO being an acronym that stands for “roll-on roll-off”.
This final option is the cheaper of the two and offers a higher degree of convenience, as your vehicle will literally be rolled onto the ship and then rolled off at the arrival port. However, without the protection of a container, the vehicle that you’re shipping is more vulnerable to damage during transit. This will be of particular concern when importing used U.S. vehicles into Uruguay, as damage to a used classic or sports car will necessarily be more expensive than it would be for a lower quality vehicle.
As for arrival ports there are several options, including Salto, Las Piedras, Paysandu and Montevideo. The last port, Montevideo, is the main port in Uruguay, and the port to which you’ll have the most luck finding service. To learn more about Montevideo and other Uruguayan ports, you can visit the website for the Administracion Nacional de Puertos.
Getting Your Used Car Through U.S. Customs
Compared to the restrictions imposed by Uruguay, getting your used vehicle through customs in the United States will be relatively straightforward. After selecting your departure port and arranging for shipping, you’ll need to gather the vehicle’s original Certificate of Title, as well as a certified copy of said title or two complete non-certified copies.
These copies (either the certified one or the two complete ones) must be provided to customs at the U.S. departure port no later than 72 hours before the scheduled shipping date. On the shipping date itself, the vehicle will need to be presented to U.S. customs along with the original Certificate of Title. Customs officers will cross-reference the original and the copies and will also verify that the VIN number on the documents corresponds to the VIN number on the vehicle. In addition, they will conduct an inspection. Provided everything checks out, you’ll be clear to ship your used U.S. car to Uruguay!
If you have difficulty finding the location in the port where your vehicle will need to be presented to customs, simply contact the Port Director. Should you have any further questions about the required documentation for clearing U.S. customs, or need additional information for a vehicle without a title or with a foreign title, you can consult United States Customs & Border Protection.
Getting Your Used Car Through Uruguayan Customs
Once the vehicle arrives at port in Uruguay, you’ll first need to pay the landing fee for which you’ll receive your Bill of Landing. After that, it’s time to head to Uruguayan customs. Before you go, though, you’ll need to prepare originals and photocopies of the following documents:
- The Bill of Landing (Stamped)
- Certificate of Title
- Additional Vehicle Identification Papers
- Certificado Ingreso del Pais (If Applicable)
With thhese documents and their copies in hand, you’ll proceed to Uruguayan customs. Generally speaking, it will take them about an hour to process and verify the paperwork necessary for clearance. Once processed, you’ll then be directed to the Administracion Nacional de Puertos, who will process the paperwork from customs and charge you the port fee. After this, follow directions for getting your “Numero de Viaje” and your “Orden de Trabajo”, and you’ll be all set.
Should you encounter trouble, you may find this foreigner’s account of getting a vehicle through Uruguayan customs quite instructive!
Tariffs and Sales Tax for U.S. Vehicles Imported in Uruguay
Should you have a used vehicle that’s eligible for importation into Uruguay, either though the citizen exemption or the exemption for classic and sports cars, you will be subject to both tariffs and taxes.
All cars, both new and used, that are eligible to be imported into Uruguay are subject to a 23 percent tariff that’s based upon the vehicle’s CIF (Cost, Insurance Freight). For trucks the tariff is between 7 and 8 percent, and for parts the tariff is 22 percent.
There is once exemption made for the tariff, though. Uruguay is a member of Mercado Común del Sur (MECOSUR). As such, vehicles and parts that are more than 60% comprised of products made in MECOSUR countries (Brazil, Paraguay, Argentina, etc.) are not subject to the tariff.
Beyond the tariff, Uruguay also levies high taxes on imported automobiles. To start, there is a Value Added Tax assessed on all imported vehicles of 22%, again based upon a vehicle’s CIF. In addition, there is a Special Consumption Tax (SCT), again based upon the vehicle’s CIF, that’s scaled relative to the size of the car’s engine:
- Less Than 1000 cc: 23%
- From 1000 cc to 1500 cc: 28.75%
- From 1500 cc to 3000 cc: 34.5%
- Greater Than 3000 cc: 46%
In addition to the above, also note that there is a Transfer Tax that’s applicable to all vehicles (new and used) sold within the country.
The Used Car Market in Uruguay
Uruguay is in one of those regions of the world where the natural climate is kind to automobiles. As a result, one can expect to see used, vintage cars still running nearly as well as the day they were manufactured. In this way, the idea of Uruguayan used cars conjures up ideas of Cuba in the minds of many. Given how well these used vehicles can be preserved and the incredible trade protections put in place by the government, used automobiles can often be quite expensive in Uruguay.
For a savvy importer who is able to finesse the system and skirt by some of the onerous trade protections, the potential for profit is there. However, being less than scrupulous can result in an enormous tax bill that can quickly eat into profits and ruin a prospective deal. For example, a document prepared by the United States Department of Commerce concerning foreign motor vehicle import requirements warns that: “Because of taxes, in the best of cases a vehicle that costs $10,000 CIF, is sold to the public at $20,000 and in the worst of cases at $40,000.”
The Most Popular and Least Popular Used Cars in Uruguay
For the purposes of a used car importer / exporter in Uruguay, the only “popular” vehicles that are currently of concern are classic and sports cars. Of particular interest to those taking advantage of online U.S. car auctions, Uruguayans have an affinity for classic Ford automobiles. In addition, Chevrolet is the second-most popular make overall in the country, representing over 15% of the vehicles in the country. Naturally, classic Chevrolets are highly sought after.
Given that the ban on the importation of used cars must be renewed every 180 days, the possibility of the ban being lifted and the market opening up in the future is there. Should this day ever come, one should expect used Volkswagens and Fiats to be of particular interest to Uruguayan consumers. Currently, these vehicles rank 3nd and 4rd in terms of popularity, right behind Chevrolets.
However, the market overall is currently dominated by simple Chinese vehicles, which entered the market in 2008. According to the U.S. Department of Commerce, such Chinese vehicles currently own a 24% market share within Uruguay. However, there are some headwinds against the dominance of these vehicles, as the government has been increasingly moving toward regulating the necessity of safety features in passenger vehicles, a department in which these low-cost, small-engine Chinese vehicles are decidedly lacking.