Goods, manufactured in the EU, can move freely or without the need for customs clearance within the EU since there are no customs barriers between the member states. Such goods are considered to be in free circulation. On the other hand, there is a common customs border between the EU and the rest of the world. Before goods can be imported from outside this customs border, customs clearance must be obtained, with the necessary corollory that customs duty and other charges would have to be paid. Upon receiving customs clearance, such goods would then also be in free circulation within the EU.
The latest in a long line of supply chain security legislation in the EU is the introduction of the Import Control System which requires the provision of advanced shipment data to customs authorities. The ICS comes within the scope of the EU eCustoms programme the aim of which is to ensure the protection of importation movements into the EU.
From January 1 traders have to make an electronic declaration before goods leave or enter the EU. The aim of this measure is to increase security in international trade by enabling customs to carry out risk analyses on the basis of data received in advance. All traders involved in customs transactions will have to provide EU Customs with necessary information through electronic declarations, before goods are brought into, or out of, the EU.
In implementing this Import Control System the EU intends to enhance the security and safety systems currently in force. Depending on the security and safety risks involved in a particular transaction, customs authorities have the right to approve or intervene by for instance, transmitting messages to customs situated in other member states about risky shipments, intercepting the goods on arrival in the EU and, lastly, by stopping shipment altogether.
Data has to be submitted by way of an Entry Summary declaration to the customs authority at first entry into the EU. For example, in the case of sea freight shipments which are from Shanghai to Southampton via Valletta Grand Harbour, the data will need to be submitted to the Maltese customs. Moreover the ENS must be submitted at the first port of entry, regardless of the fact that the goods are en route via the EU to a destination outside the EU.
The carrier, as the operator of the active means of transport on or in which the goods are brought into the customs territory of the EU is responsible for lodging the ENS, in time and accurately. The carrier is allowed to delegate to a third party, such as a forwarder or an importer, to do the actual filing of the ENS.
There are a number of timeframes that carriers have to respect in submitting the ENS, each depending on the means of transport, and ranging from 24 hours in advance of loading for maritime cargo to 1 hour before arrival at the customs office of entry into the EU for road traffic or even less for certain air transport.
The type of security data requested from the traders varies according to the means of transport and the traders involved in the operation. It can include, for example, a description of the goods, information on the consignor or exporter, the route of the goods, and any potential hazards.
As of January 1, therefore, it has become mandatory for carriers to electronically provide EU customs authorities with advance information on shipments that are either in transit through the EU or destined for a member state. This additional burden on carriers will force them to make changes to their systems and processes, requiring them to invest in new technological resources and staff.
Dr Grech is an associate with Guido de Marco & Associates and heads its European law division.