The following is by Charles R. Phillips, an Ecuador resident. He is the author of Blue Book for Grassroots Politics, published by Thomas Nelson & Co. Phillips is retired and lives in Cuenca.
One of the most difficult decisions for new expats — after deciding to make Ecuador their home — is whether or not to ship their household goods. The Ecuadorian government allows new residents one duty-free shipment of household goods but there are conditions that must be met.
The first consideration is cost.
Where you ship from and whether you use a 20-foot or 40-foot container, will go a long way in determining what you pay. As an example, it should cost you $4,800 to $5,200 to ship from the U.S. Midwest to Guayaquil, Ecuador’s major port. Important note: I am dealing here with overseas container shipping in this article; if you ship via air freight, the same packing and inventory rules apply.
Another important cost consideration is packing. You may save money by doing the packing yourself, but you will need some professional counseling in order to do it correctly. Packing for international shipping, in a container, is not the same as packing to ship cross-country over the freeway and smooth roads in North America. Ecuadorian customs requirements will also affect how you pack.
Although shipping companies may provide you with a price quote, remember that anything beyond the original specifications will mean an add-on charge. Every precious valuable item that must be specially packed is an additional charge, ranging from $145 to $300, depending on crate size. Just putting your favorite mattress in a water poof package is additional. Don’t forget to number and tag all your boxes, following Ecuador’s custom regulations. You should also check off each item as it is loaded in and unloaded from the container. Take pictures of everything before and after it is loaded. Request copies of pictures your shipping company took. Most U.S. and Canadian shipping companies do not know Ecuador’s customs requirements for the packing list, so make sure that you do. This list is different from the standard packing list, requiring much more detail.
Hints to make sure your valuables arrive unbroken:
1. Pack extra-well, using extra padding.
2. Place “fragile” stickers in easy-to-see places on boxes. The Spanish word for ‘fragile, by the way, is “fragil,” without the final “e.”
3. When loading your items in the container put fragile items on top and be sure they are secured.
4. For fragile and clothing items use sturdy, commercial grade boxes. Cheap, used boxes can be very costly in the long run.
Another shipping cost involves loading and blocking the container. The standard charge is from $90 to $150 an hour, with a four hour minimum.
Do not assume that once your empty container is delivered you have all the time in the world to load it. Typically, you will have 24 to 48 hours to load it. Check with your container company to understand their policies and charges.
After your container is loaded it must be transported to a departure station. This may not be the actual port of departure but the nearest container collection point to your home, such as a railway yard. The in-country charge to ship the container will depend on mileage and “fuel add on” charges. A 10- to 50-mile trip costs about $150, while 100 to 200 miles will cost you $800, and so forth. Different container companies have different departure points and the larger companies will have more departure points which can lower your overland charges, something to keep in mind when choosing a company.
The next cost, and the easiest to understand, is the sea travel cost for your container from port of departure to Ecuador. Unless you want your container opened in Guayaquil (I recommend against this), be sure your bill of lading has the final destination city, closest to your new home, that has private customs agents. All paperwork must list the destination city, including your packing list and insurance papers.
Another cost is Insurance. This should run 1.5 to 2% of the declared value. Use “in country insurance” if you are concerned with insurance that will pay in case of a loss. You can choose your deductible rate. You are required to have an Ecuadorian insurance company insure the policy for international over-sea transport. This insurance is required but will not pay for losses because the insurance is not collectable on used goods, only on new goods, and you must have an identification tag on each item and the original receipt of purchase on each item to collect. Since you are not allowed to ship new goods as a new Ecuadorian resident, this insurance is virtually worthless, but it is required. The up side is that it’s cheap. If you want to insure your goods you will need two policies. Welcome to South America logic.
New enforcement of an old Ecuadorian custom law: each item in a box must be listed and valued. Every item in a box must be identified with a value assigned to it.
Putting together your packing list is one of the most important things you will do in the shipping process. Take your time with it and make sure it meets Ecuadorian customs requirements. It may not make sense to you but you’re not the one responsible for allowing your items into Ecuador. It’s critical that you follow the rules and that your agent has a good relationship with customs.
One of the many reasons for containers being held up in Guayaquil, even if the final destination on the Bill of Lading is the private customs office in another city, is paperwork mistakes.
The same is true for your packing list. It’s a good idea to send your packing list to the nearest Ecuadorian consulate and play the back and forth game until all questions are answered and they stamp the packing list “approved.” The alternative is to have your Ecuadorian agent work with local private customs office and have your list notarized and approved in Ecuador.
Do not ship, or list, forbidden items on your packing list; this will cause serious problems with customs and could cost you time and money. Depending on the forbidden items that you ship, it may also constitute a felony. Keep in mind that items that new residents are allowed to bring into the country duty-free, differ from Ecuadorian citizens are allowed to bring in. Beware: many agents do not know what items new residents are allowed to import and will tell you what you want to hear. Write me or talk to your Ecuadorian visa attorney regarding what you can and cannot bring into the country under the category of “household goods.”
A quick answer to a frequently asked question. A resident cannot import a car duty-free. You can only bring a car that is less than one-year old in a separate container by paying 60% duty.
Following these steps will insure that your shipment makes it to its final destination. Mistakes may mean your container is detained in Guayaquil with a $100 per day storage fee. You will also be responsible for the cost of new, corrected paperwork. We have heard expat horror stories of household goods being held in Guayaquil storage for 60 to 90 days or more. Don’t let it happen to you.
The final cost is paying your shipping agent, import taxes, port charges, freight and other fees. These generally run around $4,300 to $5,300. Your agent should provide you with a written, detailed break-down on his charges and what duties he will perform on our behalf. Make sure you understand the services you are entitled to. Remember, once your items are in a container and shipped you are at the mercy of your agent’s truthfulness and diligence.
These are some of the problems that commonly occur if you do not have a written agreement on all charges and services provided:
1. Add-on charges you will have to pay before your container is released.
2. Confusion about how the customs service works and what is required of you.
3. Being told false or misleading information which later costs you money or holds up your container.
4. Facing extra duty charges by Ecuadorian customs.
Problems when your shipment arrives.
Your items arrived at your new Ecuadorian home and it looked like a bomb went off inside the container. What happened? You call your shipping agent or container company and only to be told it was packed tight and right and properly when they closed and sealed your container. This won’t happen if you conduct your due diligence at the front end and pick a reputable shipper. A reliable company will have pictures to prove that their work was done right.
Your problem could have been cheap boxes (see above) or boxes that were not completely filled and settled during the trip.
Or, the damage could have been caused in Guayaquil, when customs opened the shipment because your paperwork was not in order (again, see above). If you choose to have your shipment opened in Guayaquil, makes sure your agent, and yourself, if possible, are present for the inspection.
If there is damage, be sure to take pictures of each broken item before it leaves the container. Have someone check off each item and each box from your packing list as it is unloaded. Have a person stand at the container at all times. If you use an elevator, have someone at the elevator as items are loaded to go up to your apartment.
Some final advice. Make sure you are comfortable with your packer, shipper, insurance company, and your Ecuadorian agent, and that you understand the rules. Get everything in writing. If it looks too good to be true, it probably is. A well managed move of a 40-foot container from the middle of the U.S. to Ecuador should cost around $9,500 for your basic shipping, plus a few add-ons. If you use a professional, turn-key mover who handles packing, shipping, and unloading, home-to- home, you will pay around $11,000 to $15,000, not counting custom fees and taxes. Moving is a high risk business so companies will charge for the risk.
Comments? Email the editor: CuencaHighLife@gmail.com