Customs -  Are you ready for the changes? 

Customs updates for AEO/UCC 22nd October 2015

CCC to be replaced with UCC accross all member states from 1st May 2016

Implementation details for AEOCS and UCC including the lead into 2020 are avaialble from Felixstowe Trade and Enterprise College Education Committee by email info@felixstowe-ac.co.uk 

 

Managing the Transition

Because of the volume of legislative and consequential procedural changes that will be introduced with effect from midnight on 30th April 2016, the transition to the new UCC regime will require careful management so as to ensure minimal disruption to trade. At EU level, work is underway to craft specific legal provisions to facilitate traders in continuing with “business as usual” as they transfer to the new regime.

In the lead up to 1 May 2016, while for the majority of operators there should be a seamless transition from the old to the new regime, Revenue will be making individual contact with the holders of certain approvals and authorisations who face significant changes in existing practices.

The UCC will introduce a number of new concepts and modernise many existing procedures. Some of these changes will require the development of new IT systems and enhancements to existing systems which will be introduced on a phased basis between now and 31 December 2020. The process of defining the scope of these system changes is due to be completed by the end of 2015 and Revenue will communicate the details as further information becomes available.

What will the UCC Achieve?

• Modernise customs legislation and procedures;
• Provide greater legal certainty and uniformity to businesses;
• Increase clarity for customs officials throughout the EU;
• Simplify customs rules and procedures and facilitate more efficient customs transactions in line with modern-day needs;
• Complete the progression to a paperless and electronic customs environment;
• Reinforce swifter customs procedures for compliant and trustworthy economic operators.

What's Changing?

• Drawback will no longer be allowed in Inward Processing (IP);
• Processing under Customs Control (PCC) will be merged with the IP suspension procedure;
• Compensatory Interest in relation to the IP procedure is being removed;
• Type II Free Zones will no longer exist;
• Comprehensive Guarantees and Guarantee Waivers will be more widely available;
• One new criteria will be added for AEO status;
• Temporary Storage period of discharge will be increased;
• Increased harmonisation of rules relating to customs decisions;
• Level 1 Air/Sea Simplified Procedure for transit will no longer be available;
• Level 2 Air/Sea Simplified Procedure for transit will be replaced with the use of an electronic transport document as a customs transit declaration;
• New harmonised datasets for all declarations/notifications;
• Applications for the Temporary Importation procedure will be made electronically.

What's New?

• Centralised Clearance;
• Self Assessment;
• Binding Tariff Information will be binding on the holder;
• A common electronic application and authorisation process for customs authorisations;
• Certain Authorised Economic Operator (AEO) criteria will be used in assessing applications for all authorisations and simplified procedures;
• As required under customs legislation, all exchanges of information between customs authorities and economic operators will be made using electronic data-processing techniques;
• Registered Exporter System (REX) for claiming preference under the Generalised System of Preferences (GSP) scheme;
• Use of a reduced dataset on the New Computerised Transit System(NCTS);
• A new electronic system for storing and exchanging information relating to Proof of Union Status using T2L, T2LF and Goods Manifest;
• New safety and security rules allowing for the introduction of multiple filing at entry, compulsory commodity codes, provision of pre-loading security data for air cargo and weight thresholds to replace the value exemption.

Need to Know More?

HM Revenue & Customs Draf Report

Union Customs Code (UCC) - Transitional arrangements for the withdrawal of the 'earlier sale' facility.

 

1. Introduction

This Customs Information Paper (CIP) is to inform interested parties of the adoption by the EU Commission of the UCC Implementing Act regarding the transitional arrangements for the withdrawal of the ‘earlier sale’ facility (currently detailed in Article 147 of Commission Regulation 2454/93) and the projected timetable.

A further CIP will be issued in due course with details of the arrangements for final withdrawal of the ‘earlier sale’ facility. 

2. Background 

Under current EU legislation where there is a series of sales before the importation of the goods, any sale in the supply chain prior to the last sale which led to the introduction of the goods into the customs territory can potentially be used as the basis of the customs value. It has to be demonstrated to customs that the sale in question is a “sale for export” i.e. at the time of that sale the intended destination of the goods is to the EU and not to a third country.

3. Transitional arrangements

Despite the best efforts of HMRC, it became increasingly difficult to maintain the current EU position on the use of an earlier sale due to increasing pressure from the EU Commission to withdraw it and a general lack of support from other Member States.

After intensive negotiations a compromise solution is now included in the UCC text. A transitional period, applying until the end of 2017, will allow contracts to be signed before the entry into force of the Implementing Act later in 2015. This would enable existing contracts to be completed under the current business terms. 

The UCC text reads as follows;

Article 341

Transitional provision on transaction value

1. The transaction value of the goods may be determined on the basis of a sale occurring before the sale referred to in Article 128(1) where the declarant is bound by a contract concluded prior to ….[1]

2. This Article shall apply until 31 December 2017.

An importer may make use of the transition clause without prior agreement from HMRC. However, there must be a contract in place clearly specifying a start and end date to the contract. Evidence may be requested by HMRC either prior to importation or afterwards. The contracts need not specify the value of each expected shipment or consignment. Use of this transitional clause is restricted to contracts that are in place before the entry into force of the Regulation. . Publication is expected in late October-early November 2015.

NB: This provision concludes on 31 December 2017, regardless of the length of the contract in place at which time the earlier sales facility is formally withdrawn.

The UCC and the supplementing Commission Regulations will apply from 1 May 2016. Until then, the Community Customs Code and its implementing provisions continue to apply.