Pakistan’s used car import rules have been temporarily relaxed by the Ministry of Commerce, offering relief to overseas Pakistanis whose vehicles were stuck at ports without the required inspection paperwork. On June 23, 2026, the ministry issued two separate notifications that address a backlog problem created by new inspection rules introduced earlier this year, and clarify which companies can officially certify used cars coming in from Japan.
Why Were Used Car Import Rules Changed?
The root of the problem goes back to January 2026. SRO 61(I)/2026, issued on January 15, made Pre-Shipment Inspection (PSI) certificates mandatory for used vehicles before they leave Japan for Pakistan. A PSI certificate is a document that confirms a car meets minimum safety, environment, and quality standards before it is shipped.
The new rule caught many importers off guard. Hundreds of vehicles had already been loaded and shipped, or were in transit, before the PSI rule took effect. These cars arrived at Pakistani ports without the required certificates, leaving owners in limbo with no clear way to clear their vehicles through customs.
That is the gap the June 23 notifications are designed to fix.
What the One-Time Exemption Covers
The ministry has granted a one-time exemption from the conformity assessment requirement for cars whose Master Bill of Lading (the main shipping document) is dated between January 16, 2026, and March 9, 2026. In plain terms, if your car was already on a ship during that window, it can be cleared without a PSI certificate.
This relief applies only to vehicles imported under the Gift Scheme and the Transfer of Residence (TR) Scheme. The Gift Scheme allows an overseas Pakistani to send a car to a family member in Pakistan. The TR Scheme lets a Pakistani national bring a car when moving back to the country permanently.
For vehicles shipped after March 9, 2026, the PSI certificate remains fully mandatory. There is no grace period for newer shipments.
Damaged or Low-Grade Cars Are Still Blocked
Not every car from the exemption window qualifies. Customs authorities have been told not to clear vehicles graded as Below Average, Poor Condition, Repaired Accident (Grade R), or Minor Accident Repair (Grade RA) on Japanese auction sheets. These are the grading codes used at Japanese car auctions to describe a vehicle’s overall condition. Essentially, any car that was in a serious accident or is in poor shape will still be turned away, even with the one-time relief.
All other rules from the Import Policy Order 2022 still apply to these vehicles, so importers cannot treat the exemption as a general free pass.
Two Companies Now Approved for PSI Certificates
Alongside the exemption, the ministry clarified which inspection companies are officially allowed to issue PSI certificates for used vehicles coming from Japan under the used car import rules in Appendix E of the Import Policy Order 2022.
Only two firms are currently approved:
- M/s EAA Company (Pvt.) Ltd.
- M/s Auto Terminal Pak (Pvt.) Ltd.
Both companies have registered their local offices with the Pakistan Standards and Quality Control Authority (PSQCA). Their inspection certificates, issued through internationally accredited parent companies in Japan, will be treated as valid proof that a car meets Pakistan’s safety, environmental, and regulatory standards.
Customs officers and the Federal Board of Revenue will verify inspection certificates directly through the local offices of these two companies. The local offices are also responsible for handling any complaints about certificates. You can check the Federal Board of Revenue’s vehicle import page for more detail on duties and procedures.
The Bigger Picture: How Pakistan’s Used Car Import Rules Have Shifted
This exemption is just one chapter in a rapidly changing policy landscape. Earlier in 2026, the government made major structural changes to Pakistan’s used car import rules. The old Personal Baggage scheme, under which a returning Pakistani could bring a car as part of their luggage, was abolished entirely through the same SRO 61(I)/2026. After that move, only the Gift and Transfer of Residence schemes remained for personal imports.
At the same time, the government opened the door to commercial imports of used vehicles for the first time in decades, in line with a commitment to the International Monetary Fund. A 40 percent regulatory duty was placed on commercially imported used cars under five years old, with that rate set to drop by 10 percentage points each year until it reaches zero by FY2030.
From July 2026, the five-year age cap on commercially imported vehicles is expected to be lifted entirely, though safety and quality standards will remain in place. Pakistan imports an average of around 34,000 used vehicles per year, a figure significantly higher than regional peers, and the shift toward more open but better-regulated imports is designed to balance consumer access with road safety and local industry concerns.
Local automakers have raised objections to the broader liberalisation, warning of losses to domestic manufacturing. But regulators say the new framework is meant to serve genuine overseas Pakistanis and bring real competition to a sector that has long been shielded from it.
Frequently Asked Questions
Who qualifies for the one-time exemption from PSI requirements?
The exemption covers vehicles imported under the Gift Scheme or Transfer of Residence Scheme, with a Master Bill of Lading dated between January 16 and March 9, 2026. Vehicles shipped after March 9, 2026 still need a PSI certificate before being exported from Japan.
What is a Pre-Shipment Inspection (PSI) certificate?
A PSI certificate is a document issued before a car leaves Japan. It confirms that the vehicle meets Pakistan’s minimum safety, environmental, and quality standards. As of January 2026, this certificate is mandatory for used cars imported under the Gift and Transfer of Residence schemes.
Which cars are excluded from the one-time exemption?
Cars graded Below Average, Poor Condition, Repaired Accident (Grade R), or Minor Accident Repair (Grade RA) on Japanese auction sheets cannot be cleared under the exemption. Only vehicles in acceptable condition are eligible.
Will used car import rules become more open in the future?
Yes, Pakistan is on a path of gradual liberalisation. From July 2026, the age limit for commercially imported used vehicles is expected to be lifted. The 40 percent regulatory duty on commercial imports is also set to reduce by 10 percent each year, reaching zero by FY2030, while safety and quality standards will continue to apply.
