The definitive Carnet thread

[Godlykepower]

I have done extensive research into overcoming the biggest stumbling block in the preparation for my London to Cape Town expedition; the issue of obtaining a Carnet.

I thought I would share this information, as I discovered one or two pleasant surprises!

A Carnet de Passage en Douane (Notebook for Passing through Customs) or usually simply called a Carnet, is basically a temporary importation document for your vehicle. Having one is absolutely essential for Overland travel through Africa & Asia.

The use of a Carnet is limited to a list of countries that are agreed upon with the issuer beforehand.

Having a Carnet tells Customs officials, that if you bring a vehicle into a country, that you are liable for any taxes or import duties arising from the sale of that vehicle.

Importing a vehicle into a country costs money(!), and governments seem to worry that vehicles will enter the country "under the radar" so as to avoid paying any import duties, which in certain places may be around 800% of the cost of the vehicle. Egypt is notorious for this line of thinking, due to its proximity to Europe.

Most Overlanders know that a Carnet is valid for one year (from the date of its issue), but I discovered that it is quite easy to renew if you are still travelling. Get someone like DHL on the case & you can have your Carnet back within a week or two.

There is only one issuer of Carnets in the UK, and that is the RAC. Relevant contact names, numbers & email addresses are at the end.

Most of us think that the cost of obtaining a Carnet is the scary part. Well, actually it IS the scary part, but not as scary as you might think!!

This is where we get our first pleasant surprise, fellow Overland minded folk...

Basically, you as the vehicle owner, have to prove to the RAC, that you can cover the cost of taxes & import duties, should you forget to drive your Land Rover out of a country you have driven into.

At this point, most people start to think (myself included, up until recently) that they somehow need to find 8 times the list price of their vehicle, and go & show the RAC a couple of sacks with ££££ signs on it, to be used as a bond, to be paid upfront.

If you are a lottery winner, then this is the way for you.

If you are like the majority of us, there is another way......

......in the UK, you can take out insurance that tells the RAC that the bond will be paid by your insurer. The insurance premium is typically about 5% of the vehicles value, but may be more or less.

The bond value is based on the price you paid for your vehicle. The cost of modifications is irrelevant, only the original purchase price when you bought it. A great reason to go Overlanding in a Series vehicle??

So, what does all this amount to, I hear you say......

For a bond of £40k, you can expect to pay in the region of £150 for the Carnet, a refundable deposit of £300-£500 and an insurance premium of roughly £2000.......so altogether about £2500 (ish).

Still not exactly the kind of money you lose running for a bus, but a LOT better than selling your children or a kidney, trying to stump up 40 grand!

Dont try to cut corners in trying to obtain a Carnet though. Once you have received your shiny new yellow Carnet, make sure that your engine number, chassis number & registration number are 100% matched to that of the document. This is especially true of older vehicles that have had chassis/engine swaps.

Right, so now you have the thing, what do you actually do with it??

You drive up to the border crossing, where you wait around for a few hours; and eventually, your vehicle, Passport & Carnet will be inspected.

The relevant page for each country you will be visiting, has seperate sections for Entry To & Exit From . When you enter, a section is stamped & removed. When you leave, a section is stamped & removed. The obvious aim, is to ensure that you have an Entry & Exit stamp for each country.

When you get back to the UK, the RAC will stamp a "UK Entry" stamp (usually upon visual sighting of the vehicle.)

If for any reason, there is any comeback several months down the line, from a country you have visited, the RAC will prove that the vehicle is still here.

Useful contacts:

RAC - Carnet Fees

RAC - Carnet Application Form

Lloyds Carnet Insurance Proposal

Bank Guarantee Form

If you want to email the RAC with any queries, you need to be speaking to Paul Gowen - carnets@rac.co.uk

I hope that this is of use to someone.

Martin

[mmgemini]

Evening Martin - Margaret here

Might I add to your excellent post the fact that if you have a friendly bank manager it might only cost you +/- £75. They actually agree to put up the bond for the carnet so all you pay are the bank charges.

Mike has already spoken to our manager who said that £8000 would not be a problem but £24000 would be!!!!

We have actually used this method for our 3 trips and find it works well.

Margaret (Mrs G)

[Godlykepower]

Hello Margaret,

That sounds wonderful! I, however, do not own my own home, or have anything to offer as substantial security to my bank, so it looks like I am going to have to go down this route, which is certainly a lot more appealing than trying to find 800% of the value of an £10.5k Defender!!

Looks like its game on still for next year then....no more reasons to postpone! YAY!!

Martin

[Godlykepower]

Also Margaret, I understand Mike was going to try pushing his vehicle valuation as low as £1000, hence the £8000 bond coverance (800% vehicle value).

As I paid a LOT more for my Defender, I could lower its value (from an insurance perspective) but I would still be looking at 800% of several thousand pounds.

As it is I am facing a bond of about £80000. I just cant take the chance of lowering my value, only to have it stolen, or be in an accident, and I will receive a pittance from my insurance, for a vehicle worth a lot more.

Martin

[africanpete]

Thank you, this is all very usefull info.

Martin, you laid it out in a plain and simple easy to understand format

I'm planning a trip to SA at the end of 09 beginning 2010 depending on finances, have been preping the vehicle for the last year and am only now starting to tackle all the paperwork, route planning and financial side so this thread is a great help.

Cheers

Pete

[Godlykepower]

Thank you Pete!

Obviously finances are the biggest consideration for this type of trip, and a Carnet a very big part of that.

I have been putting this off for so long now, I always seem to find some excuse that I tend to blame on lack of money issues. After all this research, this makes the whole trip quite a lot more manageable financially. Its still going to cost an arm and a leg, but now I have clarity on a Carnet, its a lot easier for me.

Looks like we have quite a lot to talk about in the Pyrenees hey?!

Martin

[africanpete]

Looks like we have quite a lot to talk about in the Pyrenees hey?!

I'll bring the cold ones

[Godlykepower]

Aaaah.....I can picture the scene now! Mountains, 2 Land Rovers, camping, beer, talking about overlanding, braai....... B)

......I want to leave now please.

Martin

[africanpete]

Man, I can't wait, picking up some maps tomorrow... not gonna hi-jack this thread, see your Pyrenees thread.

Later

[mmgemini]

Remember when working out the value of the vehicle for the Carnet. Use the bottom book price. Forget any extras.

HTH

mike

[jpk]

HSBC basically said to my other half that seeing as they held her mortgage they had no problem with arranging the bond for a ratty old Land Rover! They actually have a department that deals exclusively with sort of thing. Problem is, very few people seem to know that this department exists or how to get hold of them. If anyone is interested I'll get Helen to try and find the contact details. Obviously this does not help you if you're not a home owner or don't bank with HSBC but may be worth checking if your own bank has something similar. The carnet proved to be a lot easier to organise than rumours suggested and the RAC were very helpful.

JP

[mmgemini]

HSBC basically said to my other half that seeing as they held her mortgage they had no problem with arranging the bond for a ratty old Land Rover! They actually have a department that deals exclusively with sort of thing. Problem is, very few people seem to know that this department exists or how to get hold of them. If anyone is interested I'll get Helen to try and find the contact details. Obviously this does not help you if you're not a home owner or don't bank with HSBC but may be worth checking if your own bank has something similar. The carnet proved to be a lot easier to organise than rumours suggested and the RAC were very helpful.

JP

I'm with Lloyds TSB

The bank manager first said that they didn't do those things.

A call to the RAC Carnet issuing department soon had the telephone No for the Lloyds TSB office which handled the bonds.

I've not had a problem since.

mike

[Godlykepower]

Well, this thread wasn't as popular as I thought it would be.

[Guppy]

Very informative. Certainly calmed me down as i'm planning a jaunt across Africa myself and was getting in a right lather about carnets and whatnot! Cheers!

[MissAdventurous]

Do you also need seperate motor insurance?

What if your vehicle is stolen? is this covered in the carnet? If your vehicle is stolen for example in Egypt, has anyone had any problems with officials saying that it wasnt stolen just so that the carnet insurance has to be payed out?

What happens if you decide to sell your vehicle to save shipping it back to the UK?

Is there anywhere you can get insurance for all the extrras on the vehicle?

[Godlykepower]

A Carnet is NOT insurance, and has absolutely nothing to do with insurance. Having a Carnet does not cover YOU for anything whatsoever. It covers the cost of any importation duties to the country your vehicle gets left in.

You need to get insurance cover for your vehicle. I cant think of a single UK insurance company that would cover a trans-continent expedition.

You can get insurance at borders for many countries that will cover you for accidents. Leaving your vehicle there after an accident is a very stupid thing to do IMO.

If you are planning any sort of expedition, you need to incorporate an element of parts supply logistics, to ship spares to you whereever you are, in case of breakdown. Leaving a vehicle there is only acceptable if you are a lottery winner, and can afford 100k when you get home.

[HPLP]

Stupid question though.....do all people traveling in africa buy insurance at the border crossings apart from those that dont bother........I only ask as I renewed my insurance today and Adrian Flux said that they didnt even cover morocco with their NIG policy that I took out for my 90.......

H

[mmgemini]

Stupid question though.....do all people traveling in africa buy insurance at the border crossings apart from those that dont bother........I only ask as I renewed my insurance today and Adrian Flux said that they didnt even cover morocco with their NIG policy that I took out for my 90.......

H

Yes.

I suggest you check with other insurance companies. Some do insure TPO for North Africa.

You will have to go to one of thetwo UK specialst insurers to get All Risk Insurance.

mike

[Godlykepower]

Right, got further clarity on this subject today.

I called Paul Gowen directly & he is a really smashing chap & very helpful. He said he receives so many emails (most of which are very repetitive) that he does not really bother replying much. He much rather prefers a telephone call, so his direct line number is 01454 208 000.

To clarify, the Carnet value is based on average replacement values for that vehicle. The fact that I paid over 10k for my Defender means sod all, as all he cares about is what it costs on average to replace a 1995/1996 Defender 90, which he says is about £5000. That is at current replacement values, if you are planning an expedition next year or further in the future, the value will come down due to vehicle depreciation.

Paul confirmed that going through Egypt immediatley makes a Carnet more expensive, and that because of a route through Egypt the Carnet will be worth 800% of the vehicle replacement value.

So for a vehicle that will cost £5k to replace, you are looking at a Carnet of £40k value.

There are actually 3 ways to cover this cost, I learned. Your own bank can cover it for you, provided you have collateral (a house), you can give the RAC the money directly (although you are limited to £10000, as there are issues with banking for amounts over that) or you can indeed take out a policy with R.L Davies. This insurance company will base their premium on 10% of the Carnet value, in my case £4000.

On top of this are a couple of incidental charges. £150 for the RAC to do the paperwork, a couple of hundred for other bits & bobs etc. So, a £4000 Carnet will actually cost £4700.

However, the good news is that upon the vehicles return to the UK, you get back half of everything (minus the administrative costs.)

Some might say that this is a waste of money, because at the end of your trip, you get absolutely NOTHING for you £2300 you have just lost/spent.

As I dont have the option of the other 2 ways of covering my Carnet, this will be the one for me. It works out at £170 a month lost over a 12 month expedition.

Also, I notice that the links are dead in the initial post I made, so all the details can be found HERE now.

ps It takes about 6 weeks to prepare & finalise the documentation.

Martin