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Community Customs Code

Community Customs Code

Outline of the Community (European Union) legislation about Community Customs Code

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

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Community Customs Code

The Community Customs Code compiles the rules, arrangements and procedures applicable to goods traded between the European Community (EC) and non-member countries. The Code is a single act covering the scope, definitions, basic provisions and content of Community customs law

Document or Iniciative

Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code [See amending acts].

Summary

The Community Customs Code codifies Community customs law. It replaces a great many acts of law, thereby increasing transparency. It lays down the scope of customs provisions and the basic definitions.

The Code’s provisions

The Community Customs Code entered into force in 1992 (it has applied since 1 January 1994) and mainly concerns:

  • general provisions on people’s rights and obligations with regard to customs legislation (right of representation, information *, etc.);
  • the basic provisions governing trade in goods. These include import and export duties, customs value *, the EC’s customs tariff, the tariff classification of goods and their origin;
  • the provisions governing the introduction of goods into the EC’s customs territory. These cover the presentation of goods to customs, the customs declaration *, the obligation to assign goods a customs-approved treatment or use, and temporary storage;
  • non-Community goods which are moved under a transit procedure;
  • customs-approved treatment or use. The Code describes the placing of goods under customs procedures, release for free circulation, transit, customs warehousing *, inward * and outward * processing, processing under customs control *, temporary admission and export;
  • introduction of goods into a free zone or free warehouse *, re-export, destruction of goods and their abandonment to the exchequer.

Amendments in 1997 and 1999

Amendments adopted in 1997 simplified the Code to make its implementation in the Member States more efficient. They concern the customs debt and control of free zones, and the simplification of formalities surrounding the customs declaration.

The amendments introduced in 1999 chiefly concern customs transit. They clarify and improve the rules on discharging the transit procedure and the responsibilities of those authorised to use the procedure. They also cover financial guarantees and procedures for recovering debts arising from Community transit operations.

Amendments in 2000

The 2000 amending act introduced measures aimed at:

  • introducing procedures for preventing fraud;
  • simplifying and rationalising customs rules and procedures;
  • facilitating the use of electronically submitted declarations;
  • facilitating the use of the procedures for inward processing, processing under customs control, temporary admission and free zones;
  • defining a new concept of protecting “good faith” for those importing goods under preferential conditions.

Customs and security

The 2005 amendments are aimed at tightening security requirements for movements of goods across international frontiers. Economic operators are now required to provide the customs authorities with details of goods before they are imported into the EU or exported from it. This will entail the setting up of a one-stop shop for importers and exporters.

The new concept of approved economic operator (AEO) simplifies trade. The Member States may grant AEO status to any economic operator meeting common criteria. These criteria concern control systems, financial solvency and the operator’s track record in complying with the rules.

The Member States are required to use risk-analysis methods. Uniform Community criteria have been introduced for identifying risks for control purposes. The machinery is based on computerised systems.

2005 proposal

In November 2005 the Commission adopted a proposal aimed at modernising the Community Customs Code. This proposal is part of the implementation of the Lisbon Strategy. It is aimed at simplifying the legislation and administrative procedures governing imports and exports. Facilitating customs operations in this way reduces costs. In addition, the Commission proposes:

  • streamlining structures and making terminology more consistent;
  • streamlining the system of customs guarantees;
  • extending the use of single authorisations (whereby an authorisation issued by one Member State on completion of a procedure would be valid throughout the Community).

BACKGROUND

The tighter security requirements follow up two communications published by the Commission in 2003. They are the communications on ” a simple and paperless environment for customs and trade” and on ” the role of customs in the integrated management of external borders “.

Key terms used in the act
  • Binding origin information (BOI): Binding tariff information (BTI): written notices issued by the customs authorities. BOI notices concern the preferential or non-preferential origin of goods and are issued to a specific importer or exporter. BTI notices concerning the classification of goods in the Combined Nomenclature or a secondary nomenclature such as TARIC.
  • Customs value: value of goods. It is used to calculate the amount of customs duties.
  • Customs declaration: act whereby a person expresses the wish to place goods under a customs procedure.
  • Customs warehousing: the customs procedure permitting the storage of goods.
  • Processing: inward processing permits the import of goods for working and subsequent re-export. Outward processing permits Community goods to be exported for working and then subsequently re-imported with total or partial relief from duties.
  • Processing under customs control: processing under customs control permits import duties to be suspended on goods imported for working and these goods to be released for free circulation at a lower rate of duty.
  • Free zone and free warehouse: free zones and free warehouses are part of the Community customs territory, but import duties on non-Community goods are suspended there. Community products are eligible for measures conditional, in principle, on their being exported.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EEC) No 2913/92 22.10.1992 OJ L 302 of 19.10.1992
Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 82/97 01.01.1997 OJ L 17 of 21.01.1997
Regulation (EC) No 955/1999 10.05.1999 OJ L 119 of 07.05.1999
Regulation (EC) No 2700/2000 19.12.2000 OJ L 311 of 12.12.2000
Regulation (EC) No 648/2005 11.05.2005 OJ L 117 of 04.05.2005
Regulation (EC) No 1791/2006 1.1.2007 OJ L 363 of 20.12.2006

Related Acts

Proposal, of 30 November 2005, for a Regulation of the European Parliament and of the Council laying down the Community Customs Code (Modernised Customs Code) [COM(2005) 608 final – Not published in the Official Journal] [2005/0246 (COD)].

Proposal for a decision of the European Parliament and of the Council on a paperless environment for customs and trade [COM(2005) 609 final – Not published in the Official Journal] [2005/0247 (COD)].
These proposals form a package aimed at creating a simple, paper-free environment for customs and trade and an electronic Community customs environment. The proposed measures are intended to:

  • make Member States’ electronic customs systems compatible with each other;
  • introduce electronic risk analysis;
  • make electronic declarations the rule.

Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code [Official Journal L 253 of 11.10.1993].

This Regulation gathers the implementing provisions for the Community Customs Code in a single act.

Provisions implementing the Community Customs Code

Provisions implementing the Community Customs Code

Outline of the Community (European Union) legislation about Provisions implementing the Community Customs Code

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Customs

Provisions implementing the Community Customs Code

Document or Iniciative

Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code.

Summary

This regulation contains the implementing provisions for the Community Customs Code. It combines the implementing provisions for European customs law in a single document. It covers:

  • general implementing provisions;
  • customs-approved treatments or uses;
  • privileged operations;
  • customs debt and certain controls.

GENERAL IMPLEMENTING PROVISIONS

These general provisions cover areas such as binding information, the origin of goods, their value and customs declarations.

Binding information

Binding information refers to a tariff information (BTI) or an origin information (BOI):

  • a BTI is written information issued by European Union (EU) customs authorities concerning the classification of goods in the Combined Nomenclature or a nomenclature derived from it such as the TARIC;
  • a BOI is written information issued by EU’s customs authorities concerning the preferential or non-preferential origin of specific goods to be imported or exported.

A BOI request is sent either to the customs authorities in the EU country in which the information is to be used, or to the customs authorities in the EU country in which the requester is established. Applicants for BOIs must be notified within a specific time frame.

A BTI request is made using an application form corresponding to the model set out in the regulation.

Origin of goods

The regulation sets out the criteria for conferring on products the origin of the country where they were manufactured. This covers two types of origin for goods:

  • non-preferential origin;
  • preferential origin.

For goods of non-preferential origin, it specifies the working or processing needed to satisfy the criteria set out in the Customs Code. This confers on such products the origin of the country where they were worked or processed. The Customs Code lays down that goods whose production involves two or more countries originate in the country where the last substantial processing or working took place.

For preferential origin, the regulation sets out the conditions under which goods may acquire an origin that makes them eligible for preferential tariff measures. These preferential tariff measures are adopted unilaterally by the EU for certain countries or territories (developing countries, via the generalised system of preferences (GSP), or countries and territories of the Western Balkans). To be granted such a preferential origin, a product must be wholly obtained in the beneficiary country, or result from sufficient processing of goods imported from a third country. The regulation also sets out the criteria for sufficient processing for the various product categories, and the procedures that must be respected.

Customs value

The source of the legislation on customs valuation is the World Trade Organisation (WTO) agreement on customs valuation. This agreement was transposed into the Community Customs Code and its implementing provisions. The main goal of customs evaluation is the application of the Community customs tariff. Customs evaluation is used for calculating customs duties, and has an impact on value added tax (VAT), statistics and the implementation of trade policy. The customs value of imported goods is their transaction value, i.e. the price actually paid or payable for the goods when sold for export to the customs territory of the Community. When that price cannot be determined, customs value is calculated according to a sequence of various criteria.

Entry of goods into the customs territory

Goods may be examined or samples may be taken from them once they have entered the customs territory of the Community. Permission to examine goods is granted to the person empowered to assign the goods a customs-approved treatment or use at his oral request. The taking of samples may be authorised only at the written request of the person concerned.

Customs declaration

The regulation sets out provisions that concern customs declarations made usually:

  • in writing, particularly regarding the forms to use, the information required and the accompanying documents;
  • by computer;
  • orally.

Simplified procedures

Simplified procedures apply to the release for free circulation, declarations for a customs procedure with economic impact (such as customs warehousing, processing procedures, processing under customs control and the temporary importation procedure) and export declarations.

CUSTOMS-APPROVED TREATMENT OR USE

The provisions covering customs-approved treatment or use mainly cover:

  • release for free circulation;
  • the customs status of goods and transit;
  • customs procedures with economic impact;
  • implementing provisions for the export of goods and their transport out of the customs territory of the Community.

Customs status of goods

All goods on the customs territory of the Community are considered Community goods.

The following are not considered to be Community goods:

  • non-Community goods brought into the customs territory of the Community which have been subject to customs supervision from the time of their entry;
  • goods in temporary storage or in a free zone or free warehouse;
  • goods placed under a suspensive procedure.

If goods are not considered to be Community goods, their Community status can only be established if they are:

  • brought from another EU country without crossing the territory of a non-EU country on the way;
  • brought from another EU country through the territory of a non-EU country and carried under cover of a single transport document;
  • brought from another EU country and transhipped in a non-EU country on a means of transport other than that onto which they were initially loaded, with a single transport document from the EU country which can be consulted.

Transit

The external transit procedure governs movement on the customs territory of the Community. It applies:

  • to non-Community goods with suspension of payment of customs duties and other import taxes;
  • to Community goods in certain instances set out in the legislation.

The internal transit procedure maintains the Community status of goods when, between their point of departure and arrival inside the EU, they are obliged to pass through a non-EU country.

Transit may be carried out using the procedures set out in the legislation, most importantly Community transit and the TIR procedure.

Customs procedures with economic impact

These arrangements allow certain economic activities to be carried out without incurring customs duties, and thus to attract and maintain economic activities in the EU. They enable, for example, the storage of non-Community goods on the customs territory of the Community or the import of raw materials with a view to further processing and subsequent re-exportation. The different arrangements are:

  • customs warehousing;
  • inward processing;
  • processing under customs control;
  • the temporary importation procedure (this governs the conditions for total relief from import duties on certain special-purpose goods);
  • outward processing.

Export

The export procedure allows Community goods to leave the customs territory of the Community. Other than goods undergoing outward processing or subject to a transit procedure, all Community goods leaving the customs territory are subject to the export procedure.

The exporter is the person on whose behalf the declaration is made and who, when it is accepted, is the owner of the goods in question or has a similar right of disposal over them. Where ownership or a similar right of disposal over the goods belongs to a person who is established outside the EU, the exporter is considered to be the contracting party established in the EU.

Goods leaving the customs territory of the Community

The regulation sets out the conditions which apply to goods that, moving from one point in the customs territory of the Community to another, temporarily leave that territory, whether or not crossing the territory of a third country, and whose removal or export from the customs territory of the Community is prohibited or is subject to restrictions.

PRIVILEGED OPERATIONS

These provisions concern Community goods which are brought back into the customs territory of the Community after export (returned goods). The aim is to stop import duties being charged when exported Community goods are returned, for example because they could not be sold or were defective. The title also governs cases where the EU has paid export refunds or other such financial benefits, for example under the Common Agricultural Policy.

CUSTOMS DEBT

The regulation specifies the cases in which failures can be considered as having no significant effect on the operation of temporary storage or of the customs procedure. It also deals with natural wastage and goods in special situations, such as abandoned goods. It also specifies the conditions under which post-clearance entry of the customs debt in the accounts is not obligatory as well as the relevant procedures.

Repayment or remission of import or export duties

The general provisions relating to repayment or remission lay down how to apply and explain the procedure for granting applications. They lay down which decisions should be taken by the EU countries’ customs authorities and which by the Commission, and provide for administrative assistance between EU countries’ customs authorities.

CONTROLS ON USE AND DESTINATION

Application of the rules may be subject to proof that the goods in question comply with the conditions prescribed for their use or destination. That proof is supplied by a “T5 control copy” drawn up and used in accordance with the relevant provisions.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EEC) No 2454/93

14.10.1993

L 253 of 11.10.1993

Successive amendments and corrections to Regulation (EC) No 2454/93 have been incorporated in the basic text. This consolidated version is for reference purposes only.