Major changes of the Union Customs Code at a glance

 

March 2016

 

Area

Explanation on changes of the Union Customs Code (UCC)

 
 

Customs procedures

 

New structure based on integration and restructuring of customs procedures and customs legislationThe special procedures (up to now: customs procedures with economic impact) include transit, storage, specific use, and processing.

  • Outward processing: For goods placed under the customs procedure as from May 1, 2016, only the value-added method can be used for calculation of customs duties when they are returned. The duty differential method can now only be used for goods that have been placed under outward processing before May 1, 2016.
  • Inward processing: The former processing under customs control and inward processing are merged. The inward processing drawback procedure and countervailing duties are abandoned. The destruction of goods upon request will also be part of inward processing in the future.
 

Customs declarations

 
    • Centralized clearance: The centralized clearance will allow businesses to declare their goods to a customs office different from the customs office where the goods are presented, even across Member States. This development of the Single Authorization will give economic operators the advantage of having to exchange customs declarations with only one customs office in one Member State and in one electronic system. This is certainly a good idea and has now been set on the agenda with the UCC. However, centralized clearance for import is not expected to be introduced before 2020. Until then, you can continue to operate under the terms of the Single Authorization.
  • ENS: New specifications will be required for importing: A six-digit commodity code and more detailed information on who is to receive the goods will have to be specified. Multiple filing is to be introduced to make it possible for several parties to specify information on goods movement electronically at the same time. 
 

Customs value and customs debt
(Art. 69 ff. UCC)

 
    • First Sale Rule: Has been abolished. This means that the customs value can no longer be based on first sale prices. However, there is a transitional provision in place that is applicable until December 31, 2017. According to this transitional provision, the transaction value of the goods may be determined on the basis of a previous sale if the person on whose behalf the declaration is submitted is bound by a contract concluded prior to January 18, 2016.
    • License fees: From now on, license fees will have to be included in the customs value even if the licensee is a third party. 
    • Customs debtor: As from now, a person will be a debtor if they knowingly submit wrong information in the customs declaration and this leads to all or part of the import duty not being collected (Art. 77 UCC).
    • If an unknowing failure has no significant effect on the customs procedure and all required formalities are duly completed subsequently, the customs debt can be extinguished.
 

Guarantees
(Art. 89 ff. UCC)

 
  • Guarantees: Generally, guarantees must be provided for customs debts. The Union Customs Code differentiates between a guarantee for an existing customs debt and a guarantee for a potential customs debt.
  • Comprehensive guaranteeThe instrument of the comprehensive guarantee is inspired by the comprehensive guarantee known from the transit procedure. Customs will authorize the comprehensive guarantee for various procedures upon request.
 

Binding tariff information (Art. 33 ff. UCC)

 

From now on, the BTI will only be valid for a period of three years. It will also be binding for the holder of the binding tariff information in the future and must be indicated in the customs declaration.

 

Status of goods

 
    • For proofing the status of Community goods (from now on: Union goods), the electronic "Proof of Union Status" (PoUS) system can be used in the future. Until the date of deployment of the required IT system, the procedures for proof of the customs status in the form of a T2L/T2LF or a customs goods manifest will be continued as before.
  • The value threshold for simplified proofs of status by the production of the invoice or transport document is increased to 15,000 euros.
 

Authorizations

 
    • AEO: The former certificate for authorized economic operators will be replaced by an authorization. Two new authorization criteria have been formally added. On the one hand the “practical standards of competence or professional qualifications directly related to the activity carried out” must be proven. On the other hand, no serious or repeated infringements of taxation rules must have been committed.
    • Temporary storage: Is now only possible in authorized storage facilities. The permitted storage duration is extended to 90 days. Guarantees must be provided for all existing customs debts and all potential customs debts (see "Guarantees"). Records must be kept on goods in temporary storage.
    • The approved exporter can no longer be found in the UCC. This authorization is replaced by authorizations for simplified customs declarations or the entry in the declarant's records.
 

Origin of goods and preferences (Art. 59 ff. UCC)

 
    • Preferential origin: As from May 1, 2016, long-term supplier's declarations may be valid for up to 2 years from the date of issue. Retroactive long-term supplier's declarations may be valid for a period of up to 1 year prior to the date of issue. Supplier's declarations made out before May 1, 2016, will keep their validity. The text will not change.
    • Non-preferential origin: Certificates of origin for export can be issued as before. Further list rules are added to the non-preferential origin in import (see chapters 72 and 73, for example). As a result, the rule of the last, substantial, processing or working is further formalized.
    • Registered exporter: For applying the Generalized System of Preferences (GSP) for trade with developing countries, invoice declarations of registered exporters are to replace the certificate of origin Form A in the future. A database including all registered exporters will be created for this purpose.
 
 

Efficiently managing customs changes: Ask the AEB expert.

 
Richard Groenendijk: AEB Global Trade Expert

Do you have questions about the Union Customs Code? Ask the expert.

Your contact at AEB:

Richard Groenendijk
GM and Global Trade Expert

E-mail: info@aeb.com

 
 
 
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