SyntaxWarning: import * only allowed at module level

around this issue Indeed, as already noted, it's usually best to follow the PEP 8 recommendation and do your imports at the top. There are some exceptions though. The key to understanding them lies in your embedded question in your second paragraph: "at what stage does the import ... happen?"
Import is actually an executable statement. When you import a module, all the executable statements in the module run. "def" is also an executable statement; its execution causes the defined name to be associated with the (already-compiled) code. So if you have:

def f():
    import something
    return None

Hope this helps Apparently yes, as per this answer. However, there are no citations as to this behaviour.
Update This is documented on the Swift blog:

fixed the issue. Will look into that further The task documentation explicitly mentions this:

<project ...>

   ...

   <if>
       <equals arg1="${pack.type}" arg2="impl1" />
       <then>
           <import as="packimpl" file="myImplementation1.xml">
       </then>
       <else>
            <import as="packimpl" file="myImplementation2.xml">
       </else>
   </if>


   <target name="packfiles">        
      <antcall target="packimpl.build" />
   </target>

   ...

</project>

fixed the issue. Will look into that further In Python 2, import utils is ambiguous because it can be a relative or an absolute import.
If you enable the Python 3 behaviour by adding the following import to the top of your module,

from __future__ import absolute_import

Hope this helps Given a folder structure below. Files a.py and b.py generated and can not be changed. File b.py imports file a.py. Init file is empty (can be changed). Using my_package getting an error in b.py: , __init__.py :

import sys
sys.path.extend(pkg_directory)
import a
import b

def hello():
    print('Hello')

import a

>>> import pkg
>>> pkg.a.hello()
Hello
>>> pkg.b.a.hello()
Hello