Workshop on C2C in the Arab Region Co-organized by UNESCWA and UNECA in
collaboration with UMA, Agadir Technical Unit, the League
of Arab States, and the European Commission
Casablanca 2-4 December, 2015
Zahouani Saadaoui, DG TAXUD Head of Sector electronic customs
Main notions of economic integration
Source: Jean-Paul Rodrigue,PhD, Hofstra University, NY, USA
A Customs Union in line with Art. XXIV GATT
A single customs territory
An external common customs tariff
Free movement of goods and identical rules of origin (no tariff or non-tariff barriers)
Beyond the GATT
The common customs tariff as a cornerstone of a common commercial policy
The free movement of goods as a basis for a single market
Border controls between members eliminated
EU Customs Union and GATT
History of the CU
• A simple and paperless environment for Customs and Trade (Official Journal C 96 of 21 April 2004)
• Security amendment to the Community Customs Code (4 May 2005):
Traders have to provide information on goods prior to import to or export from the EU
Trade facilitation measures for reliable traders (AEO status)
Uniform Community risk -selection criteria for controls, supported by computerised systems
• Union Customs Code
Recent history of the Customs Union
" The Union shall comprise a customs union which shall cover all trade in goods and which shall involve the prohibition between MS of customs duties on imports and exports and of all charges having equivalent effect, and the adoption of a common customs tariff in their relations with third countries” (Art. 28)
Customs Union and Free Movement of Goods (Art. 28 - Art. 37) Customs Cooperation (Art. 33) Common Commercial Policy (Art. 206-207)
• A single customs territory • An external common customs
tariff • An internal free movement of
goods (no tariff or non-tariff barriers)
• The common customs tariff as a cornerstone of a common commercial policy
Customs Union set at the heart of the European Community
Treaty on the Functioning of the European Union (2012/C 326/01)
Legal basis
• EU Customs Union = EU exclusive competence
• Community Customs Code + Common Customs Tariff
• CCC implementing provisions – Commission regulation
• Operational and administrative aspects, restrictions and prohibitions, regulated nationally
Legal basis
How EU laws are made
Citizens, interest groups, experts: discuss, consult
Commission: makes formal proposal
Parliament and Council of Ministers: decide jointly
National or local authorities: implement
Commission and Court of Justice: monitor implementation
• 28 acting as one
• Community AND national policies applied by national customs administrations
• Different roles, organisational structure
• European Commission supporting
Implementation
•Protect: • Financial interests
• Safety and security
• Competitiveness
• Environment
• Trade facilitation
• Future
What do customs do?
Tra
de
rs &
Tra
nsp
ort
Tra
de
rs &
Tra
nsp
ort
1973
9 MS
Automated
Customs
Systems
1986
12 MS
Automated
Customs
Systems
Time Line of Customs IT systems
15 MS
Automated
Customs
Systems
1995
1989
Community
Tariff
1999
Citiz
en
C
itiz
en
http://
europa.eu
Transit 2003
Risk
Information 2004
25 MS
Automated
Customs
Systems
2007
27 MS
Automated
Customs
Systems
(Authorized)
Econ. Operator 2009
Import
& Export
Control
2010
2013
28 MS
Automated
Customs
Systems
Source: Unit R5, TAXUD, EC
IT architecture of customs union
NA
NA
NA
NA
TradersTraders
TradersTraders TradersTraders
TradersTraders
TradersTradersTradersTraders
TradersTraders
TradersTraders
External Domain
National Domain
Common Domain
WORKLOAD FOR CUSTOMS IN EU PER 1 SECOND (2013)
Customs Union in numbers
Source: Customs Union Performance Project, EC
Enlargement: from 6 to 28 countries
1952 1973 1981 1986 1995 2004 2007 2013
Customs Union with other countries
All member states of EU and some of its neighbouring countries:
State Date
Monaco 1958
Andorra* 1991
San Marino 1991
Turkey* 1995
* Without agricultural products
How many people live in the EU?
Population in millions, 2014
507 million in total
80
.8
65
.9
64
.3
60
.8
46
.5
38
.5
19
.9
16
.8
11
.2
11
10
.5
10
.4
9.9
9.6
8.5
7.3
5.6
5.5
5.4
4.6
4.3
2.9
2.1
2
1.3
0.9
0.6
0.4
Germ
any
Fra
nce
United K
ingdom
Italy
Spain
Pola
nd
Rom
ania
Neth
erlands
Belg
ium
Gre
ece
Czech R
epublic
Port
ugal
Hungary
Sw
eden
Austr
ia
Bulg
aria
Denm
ark
Fin
land
Slo
vakia
Irela
nd
Cro
atia
Lithuania
Slo
venia
Latv
ia
Esto
nia
Cypru
s
Luxem
bourg
Malta
Customs duties and revenue
• In 2013 more than € 20 billion customs duties were collected of which € 15.4 billion was transferred into the EU budget, representing 11% of the revenue of the EU budget.
• The average customs duty rate is approximately 1.2%.
(figures for year 2013; 28 Member States; source: DG Budget and DG Taxation and Customs Union)
Processing time: • Time needed from acceptance of
declaration to release of goods (import, normal procedure)
Paperless index:
• The electronic input in the EU reached the level of 98%
AEO indicators:
• Involvement of AEO operators in the trade volume rising
• Reduced control rates for AEO for normal procedures, both for import and export (documentary and physical)
Customs Union in numbers
Source: Customs Union Performance Project, EC
Simplified procedures:
• The total number of articles presented under SP-increasing trend
• 78% of goods declared to customs for import, 71% of goods declared for export in 2013 used SP
AEO numbers
Figures from 15 January 2015:
• Requests: 17 311
• Certificates: 15 034
• Rejected: 1 808
• Withdrawn: 1 257
EU Customs Programmes supporting co-operation
• Series of co-operation Programmes in the customs area financed
from the EU budget
• Currently valid - Customs 2020 Programme
• The programme has a budget of € 547.3 million and will run for 7
years from January 2014.
General objective:
• support the functioning and modernisation of the Customs Union by
means of co-operation between participating countries, their
Customs authorities and Customs officials.
Specific objectives :
• protection of financial and economic interests (including
fight against fraud, IPR)
• increase of safety and security (protection of citizens and
environment)
• improvement of administrative capacity of Customs
• strengthening of competitiveness of EU businesses.
Type of actions:
• Seminars and workshops, working groups, working visits,
expert teams
• IT capacity building – development, maintenance and
operation of EU components of IT systems
• Human competency building – common training actions
(customs skills and knowledge)
EU Customs Programmes supporting co-operation
23
Customs IT Systems current portfolio
NCTS (New Computerised Transit System) ECS (Export Control System) ICS (Import Control System)
CENTRAL SYSTEMS
ART2 (Activity Reporting Tool)
CN (Combined Nomenclature) COPIS (anti-COunterfeit and anti-PIracy System)
CRMS (Customs Risk Management System)
CS/MIS (Central Services/Management Information System)
CS/RD (Central Services/Reference Data) DDS2 (Data Dissemination System)
EBTI3 (European Binding Tariff Information)
ECICS2 (European Customs Inventory of Chemical Substances) EOS (Economic Operator System)
ISPP (Information System for Processing Procedures) Quota2 (Tariff quota management system)
RSS (Regular Shipping Services)
SMS (Specimen Management System)
STTA (Standard Transit Test Application)
Surv2 (Surveillance monitoring system)
Susp (Tariff suspensions and autonomous quota)
TARIC3 (Tarif intégré communautaire)
TTA (Transit Testing Application)
EU MOVEMENT SYSTEMS
Source: Unit R5, TAXUD, EC
Business Area Systems
Import Control, Export Control, Transit ICS, ECS, NCTS
CS/RD, CSMIS, STTA, TTA
Agreements with partner countries NCTS-TIR-RU, EOS-MRA
Trader management EOS (EORI, AEO), RSS
Risk management CRMS
Enforcement of Intellectual Property Rights COPIS
Guarantee and debt NCTS-GMS
Goods classification and Tariff management CN, EBTI3, ECICS2, Quota2, Suspensions, Surveillance2, TARIC3
Customs information dissemination SMS, DDS2 (12 information domains)
Programme management ART2
Customs IT Systems current portfolio
Source: Unit R5, TAXUD, EC
Customs Procedures
• Release for free circulation
• Transit
• Customs Warehousing
• Inward processing
• Processing under customs control
• Temporary admission
• Outward processing
• Exportation
Single Administrative Document (SAD)
• An important step for the simplification of customs procedures was the introduction of SAD in 1988 .
• It replaced 150 separate documents previously used by the customs administrations in the Member States.
• The document uses harmonized codes to identify the countries of origin and destination, the exporter or carrier etc.
37 PROCEDURE
and
1 DECLARATION 37 PROCEDURE
and
1 DECLARATION
• CN is comprised of the Harmonized System (HS) nomenclature - run by WCO, with further Community subdivisions.
• TARIC (the integrated Tariff of the European Union) is a database containing all measures relating to EU customs tariff, commercial and agricultural legislation.
Combined Nomenclature (CN)
• TARIC is designed to show the various rules applying to specific products when imported into the EU.
• This includes the provisions of the HS and CN but also additional provisions, such as: tariff suspensions, tariff quotas and tariff preferences.
TARIC- the integrated Tariff of the EU
Infringements
• Enforcing the acquis communautaire is one of the key tasks conferred by the Treaty on the Commission.
• TAXUD performs this task in its sphere of competence, namely:
• Articles 21, 28, 29, 30, 45, 49, 56, 63, 110 and 111 of the TFEU
• secondary legislation on customs (IPR, cash controls, CITES, cultural goods, drug precursors, etc.) direct taxation and indirect taxation (VAT, excise duties, motor vehicle taxation, etc.)
• The Commission acts on its own initiative or in response to complaints.
Challenges with the Customs Union
• Legislation
• Implementation by 28 customs administrations
• Monitoring
• Uniformity
• Closer cooperation
• Performance measurement
• Financing
• Operational management
ELECTRONIC CUSTOMS Introducing paperless processes
31
Electronic Customs
• 99% of Customs processes in the EU are electronic
• The challenge lies in harmonizing the 28 Member States’ systems and procedures
32
Aims & means
• Harmonization and paperless processes
• Transitioning towards paperless customs by 2020: efficiency and transparency
• Requirements: Electronic systems + legal frameworks
• Electronic Customs on EU level = creating European Interoperability Systems, which aim to:
• Be secure, integrated, interoperable, accessible
• Facilitate customs processes of movements of goods
• Reduce risks & threats to safety and security of citizens
• Minimizing differences between MS customs processes
• Setting up supporting European e-Government services
• Efficient, effective, interoperable information & communication systems
• Information exchange between public administrations (front and back office)
• Exchange and process public sector information across Europe
33
LEGAL BASES & STRATEGY FOR E-CUSTOMS
Transparency between Legal, Business and IT
34
Key documents
• “E-Customs decision” (Decision No 70/2008/EC on a paperless environment for Customs and trade) sets key objectives
- The e-Customs decision was evaluated in the course of 2014 (see report)
- Link to related legislation: http://ec.europa.eu/taxation_customs/customs/policy_issues/electronic_customs_initiative/electronic_customs_legislation/index_en.htm
• Union Customs Code (UCC) provides legal base for e-Customs as well
• DG TAXUD’s Multi-Annual Strategic Plan (MASP) provides a framework & timeline for creating systems, up to 2024.
• - Strategic Framework
• - Supports e-Customs decision
• - Contains milestones, description of projects and requirements
35
MASP Review Cycle
• Publicly available on the Europa Website
• MASP is updated on a yearly basis
• DG TAXUD provides a revision for review to the ECCG (Member States and Trade), who accept the document
36
Deliverable CreationInternal Review Cycle
DG TAXUD updates MASP MS & TCG review MASPImple-
mentation
Q1 – Q2 Q3 – Q4
MASP is sent for review ECCGEnd of review
(deadline for comments)Positions are
providedECCG
(Review
Meeting)
MASP is
sent for
Implemen-
tation ver i-
fication
ECCG
(Accep
tance)
Internal
Consultations
Implementation
verification
CPG
(Endorsement)
PublicationMASP is
sent for
Accep-
tance
T0 T1 T2 T3
Deliverable AcceptanceExternal Review Cycle
(end)
Which purposes does MASP serve?
The creation of a coherent and interoperable electronic customs environment for the Community
Common understanding of the EU projects related to electronic customs and their dependencies (such as legal deadlines, business analysis and process clarifications)
Coherence between these EU projects (business scope, IT technical strategies)
Cooperation between all stakeholders (legal, business, IT, trade representatives at EU and national level)
Implementation of the projects according to an agreed planning → eCustoms Progress Reports
37
What does MASP amount to?
38
C2020: 547.3 million €
programme
Support between customs
authorities
Avoid mismatches in work, efficiency
gains
Meeting future challenges
Roll-out of approximately 30 systems by 2024
Adaptations to national systems
in 28 MS
How systems come together
39
Legal Business Projects
IT
System
Business Process Models
40
Receive Surveillance Data Manage Surveillance Data
Develop Surveillance Data Report
Provide Surveillance Information
Amend and Correct the Created Logical
Entries
L4-SUR-01-01
L4-SUR-01-02
L4-SUR-01-06
L4-SUR-01-04
Generate Surveillance Report/ Data Set
L4-SUR-01-03
L4-SUR-01-05
Case Study: Registered Exporter System (REX)
41
Scenario A: export from GSP BC to EU MS / consignment value above threshold
42
MS CDPS
Optional Required
Solution A1: validation of the REX number of BC exporter
REX V1.0
Validation
• A phased approached • Customs oriented and managed – goods ‘only’
• Based on international standards
• Not one single window for the EU: National interoperable Single Windows
• European Commission intervenes at Community level for harmonisation and coordination
• Deadline not set in legislation • No shift of competences between authorities
• Standardised tool for customs controls
Customs Single Window in the EU
• To enable economic operators to lodge electronically and once only all information required by customs and non-customs legislation for EU cross-border movements of goods
• Development of interoperable national Single Window systems in all Member States: • 28 national customs administrations
• Community AND national policies applied by national customs administrations
• National Single Window systems and EU centrally-managed systems interoperable
Customs Single Window in the EU
EU veterinary system TRACES now connected to the EU Single Window since January 2014
• Reusability
• Show case, define generally useable (technical) solution
• Strong involvement at COM level
Further projects to be considered
Way forward
Thank you for your attention!
Any questions?
Contact: [email protected]
More info at:
http://ec.europa.eu/taxation_customs/customs/policy_issues/electronic_customs_initiative/index_en.htm