Our client had a critical shipment of AI tech equipment heading to a data center in Iceland. The clock was ticking, and Icelandic import taxes (VAT) loomed large at a hefty 24%. Not only did they need the equipment delivered quickly, but they also wanted to structure the transaction to allow for the reclaim of the hefty import taxes.
The complexities of the project were threefold:
- Supplier and logistics management
- Importing dual-use tech from the USA to Iceland
- VAT savings
Let’s break down how we were able to assist our client.
1. End-to-End Project and Logistics Management
Five suppliers were involved in fulfilling the inventory. Each was based across the United States. Highlighting our vendor management process, we ensured all the equipment was collected from each vendor and sent to the most appropriate terminal for departure. We orchestrated meticulous supplier management, consolidated equipment efficiently, and chartered two planes—one from LAX, the other from JFK—ensuring timely delivery.
Thanks to the diligent efforts of our supply chain team, chartering two planes to Iceland proved to be significantly more cost-effective given the volume and value of the equipment.
2. The Complexities of the Cross-Border Movement of Tech
The client had a tight deadline and a lot of equipment to send across borders. All players in the tech industry understand the complexities of importing and exporting tech gear. The plethora of trade compliance regulations, from correct HS code identification to dual-use licenses and permits, can be difficult to navigate.
All of this equipment was destined for a data center in Iceland. Since the installation required skilled technicians and access to the facility, precise timing was essential. The equipment needed to be flown in, clear customs smoothly, and have engineers on-site at the appropriate time.
From server racks to GPUs, AI tech is extremely high-value gear. Shipping high-value tech gear is already stressful without the additional concerns of it being lost, damaged, or stolen. Our client opted for our comprehensive door-to-door cover, protecting the full shipment value + a 10% buffer from pick up to delivery.
3. Efficient Tax Structuring – Recovering Import Taxes
While the client had a VAT registration in Iceland, it was relatively new, and they were unsure of the process. Knowing that Iceland’s VAT is at 24%, there is a significant sunk cost if the filing is not done (or done incorrectly!). With the end of the month approaching and subsequent VAT filings looming, we needed to structure the transaction carefully to ensure the best possible outcome for our client.
Our comprehensive trade compliance solution sets us apart from the competition. In this case, we structured the transaction to not only reduce lead times but also improve VAT recovery. We collaborate closely with our clients to simplify global trade and deliver the best possible outcomes.
– Oliver Nouwens |TecEx Lead Engagement Director
Throughout the entire process, our skills were rigorously tested. Ultimately, we enabled the client to meet extremely tight deadlines, ensuring all equipment cleared customs smoothly and arrived at the data center on time, ready for installation. Additionally, our VAT teams structured the transaction to help the client avoid the sunk costs of import tax.
Our customizable solutions ensure that each and every one of our clients has the best solution possible for their own needs. Get in touch, and let’s chat about how we can help you import high-value AI gear to over 200 destinations.
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