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NCM and Incoterm
NCM & Incoterms Tax Classification: Essential Fundamentals to Get Started in Foreign Trade
NCM and INCOTERMS tax classification: pillars for safe importing
A successful import transaction begins with the correct NCM classification and a clear definition of responsibilities in the international contract—through Incoterms . These two points are crucial to avoiding fines and customs delays, and ensuring full control over transaction costs.
By understanding the extent of buyer and seller liability, importers can protect themselves legally and better plan their profit margins . Choosing the correct NCM (National Company Code) prevents tax errors and unnecessary inspections.
NCM: The Basis of Taxation and Customs Compliance
- Eligibility Criteria
The Mercosur Common Nomenclature (NCM) is an 8-digit code that identifies the nature of each good in Brazil; its global equivalent is the HS Code. Without the correct classification:
-you may pay incorrect or duplicate taxes ;
-your cargo is at risk of retention or fines;
-licenses, certifications and approvals may be denied.
LEARN MORE ABOUT NCM
NCM stands for "Common Nomenclature of Mercosur" and is an eight-digit code established by the Brazilian Government to identify the nature of goods and promote the development of international trade, in addition to facilitating the collection and analysis of foreign trade statistics.
- Responsibilities of the Exporter, Importer and Customs Broker
Exporter: usually suggests the NCM, as they know the product.
Importer: has a legal duty to confirm the classification.
Customs Broker: provides guidance and validation, but does not see the merchandise; therefore, relies on the technical documentation provided.
- Sanctions for Classification Error
Fixed fine of R$5,000 per incorrect item.
Fine of 1% of the invoice value (no ceiling).
Retroactive collection of taxes + interest and fines that can increase the cost by up to 37%.
- How RIMERA MULTIMODAL Ensures Fiscal Confidence
-Detailed analysis of NCM based on technical data sheets and official catalogs.
-Complete tax simulation (II, IPI, PIS, Cofins, ICMS) before purchase.
- Documented technical opinion to support future inspections.
Incoterms: Distributing Costs, Risks and Logistics Obligations
LEARN MORE ABOUT INCOTERMS
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Incoterms (International Commercial Terms) were created by the International Chamber of Commerce in 1936 to summarize, in three-letter codes, sets of clauses commonly used in international contracts for the purchase and sale of goods, defining responsibility for obligations, risks, and costs related to transportation. This simplified trade between countries and increased security.
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- What are Incoterms and how do they impact your cash flow?
Incoterms define who pays for what, where each party's liability ends , and how far the transportation risk extends. Choosing the appropriate term:
-avoids surprise costs;
- simplifies insurance;
- speeds up customs clearance.
- Practical Differences between FOB, EXW, CIF and Other Terms
-Who pays for international shipping?
-Risk transfer point
-When does the importer's broker take over?
FOB - Importer Shipment at the port/airport of origin After the goods cross the ship's rail or are "wheeled-up" in air mode
EXW - Importer (100%) Exporter's factory gate From collection, including export procedures
CIF - Exporter Arrival at port/airport of destination After unloading, before dispatch in the importer's country
DAP/DPU/DDP - Exporter (partial/all) Agreed point in destination country Only at the final stage (DAP/DPU) or after customs clearance (DDP)
- Most Used Incoterms in Brazilian Imports
-FOB – preference for cost transparency.
- CIF – popular when the exporter negotiates competitive freight.
- DAP – growth in cross-border e-commerce and high value-added cargo.
- Legal Risks of Ill-Defined Negotiations
-Fines for delay in cargo removal (demurrage & storage).
-Lack of insurance coverage in critical sections.
-Contractual disputes in case of damage.
- Which Incoterm to Choose? Quick Checklist
First low value import - Moderate risk - FOB for full cost visibility.
High value and fragile product - High risk - CIF (or CIP) with extended insurance;
High design weight/load - Complex - DAP or DDP to simplify the chain;
Pilot export via courier - Low risk - EXW to start with flexibility.
- How RIMERA MULTIMODAL Optimizes Your Incoterms
Strategic negotiation with shipping companies, airlines and insurance companies.
Contract audit to ensure that the terms reflect your tax reality.
Integrated multimodal management (road, sea, air and, when feasible, rail/cabotage).
Why Trust RIMERA MULTIMODAL?
Full-time accredited customs brokers and tax specialists.
Online dashboard with document tracking, shipment status, and compliance alerts.
Customized solutions for simple operations or complex projects (break-bulk, Roro, dangerous goods).
- Next Steps to Get Started Safely
- Request your free NCM analysis: discover potential risks before completing the purchase.
- Receive Incoterms consultancy tailored to your negotiating power.
- Implement the plan with end-to-end monitoring from RIMERA MULTIMODAL.
Increase the Efficiency of Your International Logistics
Ready to import or export without tax or logistical surprises? Click here and speak with a RIMERA MULTIMODAL specialist to schedule your initial consultation.
