Customs warehouse operators must crack new code

The latest raft of EU customs legislation to impact on the third party logistics sector will start to come in to effect from May of this year.

The Union Customs Code (UCC) has been introduced to consolidate and modernise customs legislation and provide a legal basis for electronic communications, which will become the norm throughout the European Union.

The code will have a significant effect on the way some of Britain's customs warehouses operate, says the United Kingdom Warehousing Association (UKWA), the trade body representing the UK's logistics industry.

Barbara Scott of Customs Associates, UKWA's Honorary Advisers on Customs Issues, commented: "The UCC is intended to standardise more practices within the Community, which means that not only must more control come from Brussels, but also that procedures and communication systems must be aligned within the member states to ensure that traders have access to the same facilities.

"But, logistics service providers who operate in more than one member state will know how very different the processes are and how this is ideology will be difficult to achieve!"

There are three major changes contained within the UCC that will affect customs warehouse operators in the UK:

• Customs warehouse facilities must be re-authorised by May 2019;
• A guarantee to cover the potential duty on the goods stored in the warehouse will become a mandatory requirement;
• The need for import supplementary declarations to be made to HMRC will be removed from May this year.

As with so much legislation of this nature, the possible consequences of the UCC for UK businesses is shrouded in ambiguity, as Barbara Scott explains:

"The reduction in import supplementary reporting to HMRC certainly sounds like great news. However, the business system must still be populated with the customs data and Customs

Freight Simplified Procedures (CFSP) providers currently expect that traders will continue to have to update their systems as they do at present but the data will simply not be sent to CHIEF – the processing system of customs declarations."

UKWA warns that the UCC is likely to bring about a number of other changes – some of which are not fully understood yet - that could impact upon customs warehouse operators.

"We are still waiting for guidance from Customs on a number of issues but HMRC itself is waiting for explanations from the Commission," says Barbara Scott.