European Commission Taxation and Customs Union EU Customs

European Commission / Taxation and Customs Union EU Customs Policy Developments Supply chain security a case study Manuela Cabral European Commission 1

European Commission / Taxation and Customs Union EC APPROACH ON CUSTOMS POLICY • WHY Community approach? – The Customs union (1968) – The Single Market (1993) – Free circulation of goods, persons, services and capital – One external frontier supervised by 27 customs administrations 2

European Commission / Taxation and Customs Union Aim of EU customs policy THE CUSTOMS UNION is a foundation of the EU o Nearly 40 years o Single Market o €uro TWIN AIMS OF CUSTOMS POLICY: o To protect the EU and citizens o To facilitate legitimate trade 3

European Commission / Taxation and Customs Union Changing environment & New challenges for customs in general • Increasing volumes of traffic • Increasing globalisation of trade and crime • Increasing threat of terrorist acts • Increasing interconnectivity and interdependency of societies/countries 4

European Commission / Taxation and Customs Union Changing environment & New challenges for customs in Europe • Total length of external land frontier: 12. 440 km • Enlargement of the European Union in 2004 and 2007 (e. g. length of the EU Eastern Land Frontier increased nearly 80%) • About 1. 600 million tonnes of seaborne cargo (annually) • About 8 million tonnes of airborne cargo (annually) 5

European Commission / Taxation and Customs Union Changing environment & New challenges for customs in Europe • 161. 000 custom declarations per year • 441. 000 custom declarations per day • 306 custom declarations per minute • 5 custom declarations per second 6

European Commission / Taxation and Customs Union CHANGING ROLE FOR CUSTOMS • Traditional approach: primary concern of customs are fiscal matters and revenue collection • New tasks and new challenges – due to increasing concerns for safety and security – demands of globalisation 7

European Commission / Taxation and Customs Union CHALLENGE FOR CUSTOMS In the light of the new tasks, customs have to ensure, among other: • Protection of citizens and their interests while facilitating legitimate trade • Interoperable IT systems as a means to fight fraud and increase security while not hindering trade 8

European Commission / Taxation and Customs Union EU CUSTOMS POLICY DEVELOPMENTS • Electronic customs • Modernized customs code • Security amendments to the customs code (case study) 9

European Commission / Taxation and Customs Union EU CUSTOMS POLICY DEVELOPMENTS DIFFERENT TIMEPATHS • E-CUSTOMS Communication COM(2005)609 – Decision in European Parliament and Council • process is started • Council decision is expected shortly – Phase implementation: 2006 - 2013 10

European Commission / Taxation and Customs Union E-Customs Developing secure and interoperable electronic customs systems for exchange of data – – Facilitation of import and export procedures Reduction of administrative costs Reduction of clearing times Improved conjunction between implementation of legislation and the customs practice – Ensure the right levying of duties and taxes – Enable a smooth flow of information between the relevant parties and re-use of data 11

European Commission / Taxation and Customs Union EU CUSTOMS POLICY DEVELOPMENTS DIFFERENT TIMEPATHS • Modernized Customs Code Communication COM(2005)609 – Decision in European Parliament and Council • process is started – Implementation: ? 12

European Commission / Taxation and Customs Union MODERNIZED CUSTOMS CODE • Simplification of the structure – reduction of articles • Revision of the customs procedures – centralised clearance • Improving the system for customs guarantees • Expansion of the use of authorizations for the whole EU 13

European Commission / Taxation and Customs Union EU CUSTOMS POLICY DEVELOPMENTS DIFFERENT TIMEPATHS • SECURITY AMENDMENTS TO THE CUSTOMS CODE Regulation (EC) No. 648/2005 Implementing reg. (EC) No. 1875/2006 Implementation: AEO Pre-arrival /Pre-departure 1/1/2008 1/7/2009 14

European Commission / Taxation and Customs Union EU CUSTOMS APPROACH ON SECURITY Integration of security aspects in customs controls and authorisations for traders • ensure that responsibilities are specified integration of security aspects in import and export controls • increased emphasis on export controls • ensure that data can be electronically exchanged • integration of security aspects in authorisations for operators 15

European Commission / Taxation and Customs Union EU Customs Security Initiatives Security amendments to the Community Customs Code 1) require traders to provide customs authorities with information on goods prior to import to or export from the European Union 2) provide reliable traders with trade facilitation measures (AEO-concept) 3) introduce a mechanism for setting uniform Community risk -selection criteria for controls, supported by computerised systems 16

European Commission / Taxation and Customs Union Import Control System – When is it necessary? • First port of entry - Entry Summary Declarations (ESD) for all goods on board (24 h (b/loading)-4 h-2 h) – If vessels sharing arrangements Pre-Arrival Notification (PAN) necessary (24 h(b/arrival)-4 h-2 h) – Manifest for goods to be unloaded • Subsequent ports: – ESD for goods to be unloaded – no time limit + manifest for movement between Community points • Between Community ports: – Regular shipping line: no ESD only manifest – Non regular shipping line: ESD for goods to be unloaded + manifest for movement between Community ports 17

European Commission / Taxation and Customs Union Import Control System (Draft FSS) 18

European Commission / Taxation and Customs Union Export Control System - When is it necessary? For all goods leaving the Community • Normal situation: export, re-export or transit declaration (24 h (b/loading)-4 h-2 h) • Freight remaining on board or transhipped at the place of unload – no declaration (ESD fills the role) • Others: exit summary declaration 19

European Commission / Taxation and Customs Union Export Control System (Draft FSS) 20

European Commission / Taxation and Customs Union EC Security Initiatives Result : A secure end-to-end supply chain with secure trading partners and without weak links ! 21

European Commission / Taxation and Customs Union THANK YOU FOR YOUR ATTENTION For up-to-date information about the Customs Developments visit our website: http: //europa. eu. int/comm/taxation_customs/index_en. htm 22