Customs Declaration Service communications research report

Question 1

1.  Executive summary

Accepted Answer

HM Revenue and Customs (HMRC) is introducing a new customs declaration system, Customs Declaration Service (CDS), to replace the existing Customs Handling of Import and Export Freight (CHIEF) service. This qualitative research explored the views of existing CHIEF customers to help HMRC ensure a smooth transition to the new CDS system.

Businesses’ roles in submitting customs declarations depended on whether they were represented by an agent or not. As agents manage the process for represented businesses they have less involvement and knowledge of the process than unrepresented businesses. Businesses who submitted declarations themselves and third parties were more knowledgeable of the process.

Whilst participants recognised that the CHIEF system is dated and would benefit from modernisation, its longevity has led to high levels of familiarity and comfort, particularly amongst those who use it on a regular basis. Participants whose employees had been using CHIEF for a long time were worried about challenges they may face using a new system.

There was a relationship between the size of the business or third party, whether they used CHIEF directly and awareness of the transition to CDS. Smaller or represented businesses were likely to have limited awareness of CDS and expected to rely on their agent to manage the transition on their behalf. Unrepresented businesses were likely to have more knowledge of CDS and to have received some communication from HMRC but felt this was limited and so were still unclear about what they needed to know to begin preparing. Large, unrepresented businesses and third parties in this sample had the highest awareness of CDS, were the most likely to have received direct communication from HMRC and therefore were actively preparing for CDS.

After reading a description of CDS, participants felt that it would simplify the customs declarations process and make it more user-friendly. However, they expressed concerns about initial difficulties and complications involved in getting to know the new system and felt they had little clarity so far in terms of how CDS would work in practice. Participants were worried about the new system causing delays, which they anticipated could lead to them incurring additional costs.

Low awareness of the changes and lack of knowledge regarding what they needed to do acted as barriers to businesses taking action to prepare for CDS. Represented businesses expected their agent to update them on what they needed to do and make any changes needed for them. Unrepresented businesses and third parties recognised that they may need to take action to prepare for CDS including updating software and training staff.

Businesses and third parties had similar information needs from HMRC and both wanted detailed, practical information about the changes between one and 3 months in advance. Customers were open to hearing about these changes through a range of channels. Their preference was a letter which includes a link to further information on GOV.UK with an accompanying information sheet including responses to Frequently Asked Questions (FAQs). Social media channels were also appropriate for awareness raising and third parties expected to hear about the changes from trade organisations.

Customers recognised that they may need additional support both to help them prepare for the transition to CDS and how to use it. They wanted to access this through a number of support mechanisms, including: written instructions from HMRC, video tutorials, a dummy version of the CDS system, webchats and a helpline and online support available 24 hours a day, 7 days a week.

Question 2

2.  Introduction

Accepted Answer

2.1 Background

Businesses which import and export goods from outside of the EU currently make customs declarations through the Customs Handling of Import and Export Freight (CHIEF) service. CHIEF is used to process declarations for goods entering and leaving the UK and can also be used to electronically complete customs information and calculate and pay the correct duties and taxes. Businesses either submit their declaration independently or are represented by an agent who does so on their behalf.

HMRC are introducing a new Customs Declaration Service (CDS) to replace CHIEF which will provide businesses with a more up-to-date digital service that can easily adapt to new requirements. There will be several differences including the following new features:

CDS will be accessed on GOV.UK using a Government Gateway account
businesses will be able to access several services in one place and online support if needed
UK customs data will be aligned with international standards set by the World Customs Organisation Kyoto Convention and Union Customs Code (UCC)

CDS is being introduced gradually between August 2018 and March 2019. During the migration period, HMRC is running a communications campaign aimed at CHIEF users to raise awareness of the changes, provide reassurance of a smooth transition, and to inform them of any action they need to take to prepare for CDS.

2.2 Research aims

The overall aim of this research was to understand the views of existing CHIEF customers and what both businesses and their agents need to know during the transition to help inform future stages of HMRC’s communication campaign. Specifically, the research aimed to understand:

awareness of the upcoming changes
how customers and third parties feel about the changes, and their confidence about moving to CDS
what involvement represented businesses have with CHIEF currently, and what those who use intermediaries need to know about the move to CDS
what information represented businesses provide to agents to enable them to submit customs declarations on their behalf
any barriers that customers anticipate in moving to CDS, and the information they want from HMRC to help them migrate
what communication customers have received from HMRC regarding the migration to date and how future communications can be developed

2.3 Method

A qualitative approach was used for this study, in order to gain in-depth customer insight. The research was designed and carried out between July and October 2018 with fieldwork taking place in August and September.

The research was undertaken by the Employment, Welfare and Skills team within Ipsos MORI’s Social Research Institute.

2.3.1 Sample, recruitment and fieldwork

In total, 50 telephone interviews with customers and third parties were conducted: 25 with businesses and 25 with customs agents and freight forwarders (third parties). Each interview lasted around 45 minutes and was conducted by an Ipsos MORI researcher using a discussion guide agreed with HMRC.

Quotas were set to ensure that a range of HMRC customers and third parties were included in the research, as outlined in the sample profile below (Table one).

Table 1: Sample profile

Customer segment	Characteristic	Number of interviews
Businesses	Unrepresented businesses import and export	4
Businesses	Represented businesses import and export	14
Businesses	Represented businesses import	4
Businesses	Represented businesses export	3
Third parties	Freight forwarders	8
Third parties	Customs agents	1
Third parties	Offer customs agent and freight forwarding services combined	16
Total	(All characteristics)	50

Within the sample there was also a range of firmographics including company size, length of time trading, frequency of importing or exporting, trade with non-EU and EU countries, sector and location. The majority of participants were VAT-registered companies: only 2 of the businesses interviewed were not VAT-registered.

All participants were recruited by Ipsos MORI specialist recruiters. A purposive sampling approach was adopted, whereby key quotas were set and participants were recruited according to these using a screening document.

2.3.2 Analysis and interpretation of data

The interview data was fully analysed using a robust inductive framework approach, as part of which the data was synthesised thematically and interrogated for patterns and relationships.

Qualitative research is illustrative, detailed and exploratory. It seeks to understand not only what people think and do but why this is the case. The volume and richness of the data generated allows for a detailed picture to be developed of the range and diversity of views, feelings and behaviours and this can be used to develop new concepts and theories. The findings in this report are intended to provide insight into the views of different HMRC customers but the purposive nature with which the sample was drawn and small number of interviews conducted means that they cannot be considered representative of these audiences as a whole.

Question 3

3.   Knowledge and views of CHIEF

Accepted Answer

3.1 Role in submitting customs declarations

This research found a relationship between the type of organisation (business or third party) and company size.

3.1.1 Businesses

Businesses’ approach to customs declarations largely depended on their size. Whilst the norm was for businesses to use an agent, larger organisations were more likely to manage the process themselves internally and smaller businesses to rely on an agent.

Businesses who used an agent were likely to have very little involvement with the declarations process beyond providing the agent with the necessary information. Unrepresented businesses and third parties who submitted customs declarations themselves were more involved in the process. As a result, they had a more detailed understanding of how the system worked.

Within larger businesses who made customs declarations internally, the scale of this internal operation varied. For example, in one business with between 50 and 249 employees the office administration staff made customs declarations with a more senior colleague signing these off on a monthly basis. Another business with over 1,000 employees had a team dedicated to customs declarations and had developed in-house software to facilitate the use of CHIEF.

“People have been with the company for so long, we have experts on hand daily, we do a thorough induction, on the job training, with each system they have thorough training, it’s imperative this information is correct, we don’t want fines, we are thorough, then we let them go alone and that person will shadow them overview their work before submitting it, we say to people if you’re stuck you just ask the question, especially when it comes to HMRC.” (Large unrepresented business, import or export daily)

3.1.2 Third parties

Third parties in this sample were either a freight forwarder, a customs agent or offered both freight forwarding and customs agent services. Third parties and unrepresented businesses either submitted declarations through CHIEF directly or used third party software to do this. Participants who used third party software did not always distinguish between the CHIEF system and their software, instead referring to them interchangeably or assuming they were the same thing.

3.2 Overall use and views of CHIEF

3.2.1 Represented businesses

Represented businesses were most likely to have low awareness of CHIEF and be the least knowledgeable of the system. Awareness and knowledge of CHIEF amongst represented businesses ranged from being completely unaware of the CHIEF system or the acronym before the interview to understanding it as something their agent dealt with on their behalf. Customers who imported or exported goods less frequently were the least aware and needed high levels of guidance and support from their agents regarding what information they needed to supply. Represented businesses who imported, or exported goods, or both, regularly were comfortable with providing the necessary information to their agent or freight forwarder. Due to the longevity of the CHIEF system these processes had become well established amongst these customers.

3.2.2 Unrepresented businesses

Unrepresented businesses had a trained person, or in larger organisations, a team who were responsible for managing declarations through CHIEF. Amongst this qualitative sample, there was a pattern of these individuals having been in the role for a long time and for responsibility for customs declarations to form a large proportion of their job, leading to high levels of familiarity with the system.

Views of CHIEF amongst unrepresented businesses ranged from thinking it was fit for purpose and easy to use to viewing the system as outdated and laborious to work with. Customers who used CHIEF on a regular basis were more likely to have positive views of it. However, even those with extensive and regular experience of making declarations experienced challenges using the system on occasion, which led to openness to changes to CHIEF. Challenges included struggling to navigate the system easily and difficulty identifying the right information to use at various points. One unrepresented business said that when they found the declaration too complex to submit themselves they contacted an agent.

3.2.3 Third parties

Third parties in this sample were the highest intensity users of CHIEF, meaning they had the most awareness, engagement with and knowledge of the system. Third parties had become accustomed to using CHIEF and were broadly positive about it.

Opinions amongst third parties were mixed when it came to changes to CHIEF. Third parties who had concerns about what learning and implementing a new system might mean in practice felt very strongly about keeping the current system. This was a particular concern amongst participants whose employees were older or more experienced and therefore more resistant to change. Third parties who were more familiar with or positive about change more generally expected the system to change because it was outdated and welcomed the idea of a more up-to-date, user-friendly service.

“It’s a lot easier because our customs entry currently you can do it within a few minutes because all the details are pulled through the software package.” (Medium custom agent or freight forwarder, submits declaration daily)

Overall, the longevity of CHIEF has led to high levels of familiarity and comfort amongst users. This leads to concerns about changes to the service, particularly among older employees and those averse to change. Communications will therefore need to emphasise the benefits of CDS for both third parties and businesses.

Question 4

4.  Awareness and views of CDS

Accepted Answer

4.1 Awareness of CDS amongst businesses and third parties

Businesses’ awareness of and response to the transition to CDS was dependent on the size of their business and whether they used CHIEF directly.

4.1.1 Represented businesses

Smaller businesses, or represented businesses, or both, were most likely to have limited awareness of CDS. Those who had heard about it tended to have done so from a third party or HMRC but recall and knowledge was limited. There was also low interest and engagement amongst this group who tended to rely on and trust their agent to tell them what they needed to know and continue to manage the declarations on their behalf.

“It’s their job not my job.” (Small represented business, imports or exports monthly)

4.1.2 Unrepresented businesses

The smaller end of unrepresented businesses had received some communication from HMRC but felt this was limited and did not tell them everything they needed to know in order to begin preparing. This led to concern and worry about what the changes would mean for them practically and when they would need to make changes.

“I have heard about it, I don’t know a lot about it, no can’t remember, think received an email from transport manager would have received the email and it came up in a conversation.” (Medium represented business, imports or exports monthly)

Larger, unrepresented businesses had higher awareness of CDS. They had received direct communication from HMRC and so knew what the changes were and how they would be affected. They were concerned about the change and learning the new system but generally felt that they had been given sufficient notice from HMRC to prepare. These were the only customers actively preparing for CDS, for example, by developing and delivering training and making plans for business continuity.

“We’ve heard it’s coming in, we know that some of the forwarders are trialling it…but some of them (freight forwarders) are not clued up.” (Large represented business, import or export daily)

4.1.3 Third parties

Third parties were more aware and informed about the upcoming changes than businesses, however, levels of awareness varied and there were still some third parties with very low awareness.

Awareness amongst third parties included those who were aware of the changes and preparing for this; those who had heard of CDS but did not know what it meant for them; and those who were not aware. Lower awareness was more likely amongst smaller third parties such as sole traders.

Concern about the changes motivated third parties to proactively seek information. However, even those with relatively high awareness did not feel as though they knew enough about CDS and how it would directly impact them or their clients.

“We had an email from HMRC direct telling us about the service and when it’s due to come in. We are yet to receive any more information on it with regards to what’s new that’s being implemented and so on.” (Large customs agent, submits declarations daily)

Those using a software programme to submit declarations were made aware of CDS by their provider but were the least likely to know about the specific details of changes. Whilst they expected their software provider would manage the transition for them, they also wanted reassurance that this was the case and that the transition would be smooth.

4.2 Recall of HMRC communications

Recall of HMRC communications of the upcoming changes was generally limited, with variable levels of knowledge of CDS.

There was limited recall of the letter from HMRC: third parties were more likely to recall this than businesses. Amongst those who remembered receiving the letter, the general feedback was that the information provided was too brief and it lacked practical details.

“We had an email from HMRC directly telling us about the service and when it’s due to come in. We are yet to receive any more information on it with regards to what’s new that’s being implemented and so on.” (Large, customs agent, submits daily)

Seminars provided by HMRC were highly effective at communicating the changes but there was a sense that there were too few, which led to challenges in being able to attend for smaller companies who were less likely to be prioritised. The limited availability of seminars also led some businesses and third parties, particularly smaller organisations to feel that HMRC prioritised some customers over others, for example larger businesses and agents.

Discussion with colleagues or friends had also helped to raise awareness of the changes. There were also examples of word of mouth prompting customers to search for information online including using the GOV.UK website.

4.3 Understanding of CDS

Understanding of CDS depended on the level of detailed information participants had received or found and tended to be concentrated amongst larger organisations.

Generally, customers knew that ‘a change’ was coming but were unclear about exactly how it would change or how it will affect them on a day-to-day basis. They were also unclear about how they should best prepare and when they should start doing this.

There was some awareness that the system was being tested and trialled. However, if the system received negative feedback, such as certain aspects not working properly this had a negative impact on perceptions.

There was also a misperception amongst those with lower awareness that CDS had been introduced or brought forward because of EU exit, due to the correlation of timing between these 2 events.

“We know that the system would be modified in the wake of any hard-potential Brexit.” (Small freight forwarder, submits daily)

4.4 Reactions to description of CDS

As part of the interview, after exploring spontaneous awareness of CDS, participants were asked to read a description of the new service. The description included details about timings, new features, how the changes will affect importers and exporters and what additional information businesses will need to provide. The findings in this section draw on perceptions of CDS after being shown the description.

4.4.1 Positive changes

There was a belief that the introduction of CDS would simplify the declarations process and make it more user friendly. This idea was received positively by all.

“Hopefully CDS is more efficient, the challenge is getting it going and learning it, but hopefully the benefit is it’ll be better than CHIEF.” (Medium unrepresented, imports or exports weekly)

“There are already barriers and challenges in that CHIEF is too complex so if it’s going to alleviate some of those complexities and make it a lot simpler to use.” (Small represented business, import or exports weekly)

Represented businesses who thought that CDS sounded less complex to use than CHIEF suggested that the change may mean they were able to complete declarations internally themselves, saving money on agent fees.

“Maybe it’ll be a case of me not relying on our freight forwarder so much.” (Small represented business, submits weekly)

The information CDS requires from customers was seen as being in keeping with what they have been providing already, leading to the impression that there will be little to no need to make changes to current processes or procedures.

Being able to view previous imports and exports on a predefined report was seen as a key positive of the new CDS system. Represented businesses anticipated that this would save them time and cut down on paperwork. Unrepresented businesses also felt this would help cut down on their paperwork and allow them to complete declarations more efficiently.

Being able to enter up to 999 items on one form was also seen as helping to improve the efficiency of the declaration process and mean that larger organisations did not have to submit multiple declarations or submit them on such a frequent basis.

Participants who felt positively towards the Government Gateway were happy about the introduction of this form of access. They felt that this would give them the opportunity to check the customs declaration before their agent submitted it to help avoid mistakes and potential fines.

4.4.2 Areas of concern

Unrepresented business and third parties felt that at the time of interview they had little clarity about how CDS would work in practice and so felt ill-prepared for the transition, a prime concern. This low awareness was reflected in their other concerns, which were about the transition process generally rather than CDS specifically.

Both third parties and businesses expected that the new system would come with initial difficulties and complications which would need to be resolved. There was some concern regarding HMRC’s capacity and ability to manage and implement this transition smoothly, particularly amongst those who had little experience of change or who had negative experiences with previous updates to other HMRC systems.

There were also concerns within businesses about managing the changes to the process internally. For example, there were concerns that the system may take some time to get used to and the need for staff training to support this; including how long this might take and issues which could arise. There were associated concerns about the compatibility of existing software with CDS and the costs associated with updating this. However, businesses and third parties were mostly happy to deal with this as long as it did not negatively affect the running of their business or impact on their interaction with clients.

“New things tend to have glitches and errors, and things that aren’t noticed until people are using it. So that’s one concern.” (Large customs agent, submits daily)

There were wider concerns about whether CDS would require more administration than CHIEF, for example, to register suppliers. This was exacerbated amongst those who had low understanding of some of the terms used in the information, for example, ‘commercial references and tracking numbers’ as they thought they may be required to learn new terms and processes.

Businesses and third parties also expressed concerns about whether they had time to prepare adequately for CDS. This was a particular concern given that the transition period is peak season for commercial traders and liable to bad weather which caused concern about delays in ports anyway and that CDS could exacerbate this. The possibility of delays leading to costs due to stock being held was a major concern.

“As it is in January it’s probably the worst time of the year because you usually have quite bad weather.” (Medium custom agent or freight forwarder, submits daily)

Question 5

5.  Communication testing

Accepted Answer

As part of the research, participants were shown a letter or email sent by HMRC as part of the communications campaign to date and asked for their feedback.

5.1 Overall response to the letter and emails

The letter and emails were received positively by participants who demonstrated a good understanding of the information provided. They found the language used to be clear, concise and easy to understand and praised the use of bullet points and headings to break the information up.

“No, no it’s not confusing. And to be honest, for HMRC and the government, it’s pretty straightforward.” (Large represented business, imports or exports daily)

However, participants expressed a desire for more information about the impact of the changes. They wanted detailed information on how CDS would affect them on a day to day basis as well as clear, practical guidance on how to prepare. This was particularly the case for unrepresented businesses and third parties who felt the changes would impact them the most and that they would need to do the most to prepare.

Though represented businesses anticipated that the changes would have a relatively small impact on their day to day work, they wanted information about what would be expected of them by their agents. These participants were more likely to struggle to understand the specific customs terms and technical language used but were generally happy to contact their agent about anything they did not understand.

“I don’t think it’s confusing, I mean there’s some of it that I don’t understand what it is but I don’t do that job so I probably wouldn’t [understand] for example, customs procedure codes, identification of goods location.” (Small represented business, imports or exports weekly)

5.2 Response to the letter

Participants felt that the letter effectively communicated key information about CDS replacing CHIEF, though they also felt that more in depth information should have been provided along with it. For example, participants would have liked the letter to include a guidance leaflet or used more effective signposting to where they could find further information.

“It doesn’t really give much away, it doesn’t really tell you what’s required.” (Medium custom agent or freight forwarder, submits daily)

5.2.1 The heading

The following text was used as the heading of the letter.

Dear customer

The new Customs Declaration Service (CDS)

As you may be aware, HMRC has been developing a new system for processing customs declarations for imports and exports. We are replacing the current system, the Customs Handling of Import and Export Freight (CHIEF), with the Customs Declaration Service (CDS). We will begin a phased launch of CDS from August 2018.

Although the heading clearly indicated to participants what the letter was about, low awareness of CDS increased the risk of customers failing to identify themselves as future CDS users and therefore thinking the letter was not relevant to them.

Rather than referring to CDS, a heading that emphasises that there is an important change being made to CHIEF or the way people declare customs was more likely to encourage current CHIEF users to read on. This was particularly the case for represented businesses who were heavily reliant on their agent and had little knowledge of the declaration process.

5.2.2 Why we are replacing CHIEF

The following text is from the body of the letter.

Why we are replacing CHIEF

CHIEF is one of the world’s largest and most sophisticated electronic services for managing customs declarations. But it’s nearly 25 years old and can’t be easily changed to meet new requirements.

We made the decision to replace CHIEF with CDS before the EU referendum. However, CDS will be able to handle any potential increases in the volume of declarations that may result from UK’s exit from the EU.

Why CHIEF was being replaced was a key question for participants and so it was beneficial to address this early in the letter. Participants were happy with the level of detail provided. Those who were more experienced with CHIEF or who had been trading overseas for a longer period of time tended to agree that CHIEF was outdated and were supportive of a new, user friendly, digital system.

As the completion of the introduction of CDS (by March 2019) coincides with the date for the UK to leave the EU it is beneficial to highlight in the letter that the introduction of CDS was not directly related to the outcome of the EU referendum. This helps to counter any misperceptions that the 2 are related.

5.2.3 How this will affect you

The following text is from the body of the letter.

How this will affect you

If you import or export goods outside the EU, you or your agent will be currently using CHIEF to:

process declarations for goods entering and leaving the UK or EU through ports and airports
calculate and pay the correct duty and taxes
complete customs information electronically

You will still be able to do this on CDS, but there will be differences. You will:

access CDS on GOV.UK using a Government Gateway account – if you use a customs declaration software package, follow the instructions and documentation that your supplier will give you
find several new and existing services in one place – viewing previous import and export data on predefined reports, applying for new authorisations and simplifications, and checking your duty deferment statement
find more online help including self-service tools, guides and checklists
need to give some additional information for declarations made under the World Customs Organisation Kyoto Convention, currently being implemented in the UK through the Union Customs Code (UCC).

Customs declarations were an important part of a participant’s business and so they were concerned about how the changes would affect them. The section of the letter which outlined ‘how this [CDS] will affect you’ provided a helpful summary of this and effectively communicated the benefits of transitioning to CDS. However, participants felt it did not give a clear picture of what the day to day impact would be.

Participants wanted more detail and explicit guidance on what they would need to do differently under CDS, to help them develop a clearer understanding of the impact CDS would have on the way they process customs declarations. They also wanted to know what, if any, other actions they would need to take to prepare.

5.2.4 Access CDS on GOV.UK using a Government Gateway account

The following text is also from the body of the letter.

You will still be able to do this on CDS, but there will be differences. You will:

access CDS on GOV.UK using a Government Gateway account – if you use a customs declaration software package, follow the instructions and documentation that your supplier will give you
find several new and existing services in one place – viewing previous import and export data on predefined reports, applying for new authorisations and simplifications, and checking your duty deferment statement
find more online help including self-service tools, guides and checklists
need to give some additional information for declarations made under the World Customs Organisation Kyoto Convention, currently being implemented in the UK through the Union Customs Code (UCC).

Participants shared mixed feelings about accessing CDS through the Government Gateway. Those who had negative experiences of using it were concerned about its functionality. There was also some confusion over how this feature would be accessed by third parties and those using third party software. These participants wanted more clarity over what impact this feature would have on those using software providers or submitting declarations on behalf of clients.

On the other hand, participants who had positive experiences with the Government Gateway portal welcomed this feature, often reflecting back to the ease of filing their tax returns or checking their Personal Tax Account. This tended to give them the impression that CDS was being introduced to simplify the declaration process and make it easier for businesses to submit declarations independently.

5.2.5 What happens next

The following text is from the end of the letter.

What happens next?

CDS will be phased in between August 2018 and early 2019. CHIEF will continue to be available during this time.

If you use a customs declaration software package, you or your agent will be given instructions by your software provider when they are ready for you to start making declarations on CDS.

You can also visit the CDS page on GOV.UK for more information and to register for email updates. Go to GOV.UK and search for ‘Customs Declaration Service’ to find the page.

Yours faithfully

HMRC Customs Declaration Service

Participants felt that the ‘What happens next?’ section did not provide enough information about the steps they needed to take to prepare for CDS. They felt that the current wording left them to find more information themselves, rather than it being proactively provided by HMRC.

Those with low or no awareness of CDS were most likely to want more detailed information, particularly because of the timings given. They feared they were ill-prepared and behind other businesses so wanted quick, easy access to information, and ideally for it to be included with the letter.

Highlighting the fact that CHIEF would continue to be available during the transition period offered reassurance to those who anticipated and worried about there being initial difficulties with the new system. However, they also wanted the exact date CHIEF would stop working to be included so they were aware of when they would need to be fully reliant on CDS.

5.3 Response to the emails

As with the letter, participants felt that the emails effectively communicated the key information about the transition to CDS but lacked the detail they needed to prepare.

The questions used at the beginning of the emails were seen to be more effective than the title of the email at helping customers identify themselves as the target audience.

On occasion, seeing the words ‘import’, ‘export’ and ‘EU’ together made participants think of the UK’s exit from the European Union. To help counter this, the email should emphasise that CDS is not directly linked to the UK’s exit from the EU in the same way as the letter.

“When you see things like EU, government, import, export my mind automatically switches to Brexit.” (Small represented business, imports or exports daily)

While participants were happy to see they would be able to contact HMRC directly with queries, they associated email contact with HMRC with a relatively slow response.

Participants stressed the need for quick responses and 24-hour support to help reassure them that potential problems would be dealt with quickly. This was vital to businesses because they operate around the clock and need to be able to submit declarations. As such, they felt that support tools that would provide instant responses to queries, such as webchats or a helpline would be more helpful than email.

“You need that quick response with this. It can start affecting customers if your entries slow down because you’re not sure about something, things get delayed and you end up paying for airline storage because you can’t clear it.” (Medium custom agent or freight forwarder, submits daily)

Participants were familiar with GOV.UK but lacked confidence in its search function. This meant that although they knew they could get more information by searching the webpage they were unlikely to use the link because they had previously struggled to find relevant information. Participants would have preferred a link to a specific CDS page on GOV.UK or would prefer to see the hyperlink refer explicitly to CDS, for example ‘GOV.UK/CDS’. This would provide reassurance that they are being specifically directed to the most relevant information.

Including hyperlinks in the emails to definitions of specific terms was received positively by unrepresented businesses who were heavily reliant on their agents and had little knowledge of the customs declaration process. Links to access updates on CDS also helped to reassure those who were more apprehensive about the changes and wanted more information as soon as it is available.

Question 6

6.  Preparation for CDS

Accepted Answer

6.1 Action taken to prepare for CDS

Low awareness of the changes and lack of knowledge regarding what practical changes they needed to make to prepare for CDS acted as a barrier to preparation.

Represented businesses felt that they would only need to make minimal preparation for CDS and expected their agent to do most of this for them. They felt that they already gave their agent the information which would be required under CDS and expected their agent to tell them if they needed to give any additional information for customs declarations in the future.

“If I was doing it myself I’d be more worried, the fact I’m using a third party to do it for me, it’s their responsibility to get it right and my responsibility to check it.” (Small represented business, imports or exports monthly)

Unrepresented businesses wanted detailed information from HMRC about what action they needed to take to prepare for CDS; what they will need to do differently; any changes to the look and feel of the site or forms and when they will transition.

Third parties felt that they could not start to prepare fully until they received more information from HMRC about timings and what the changes would mean practically. They wanted similarly detailed information as unrepresented businesses; practical guidance on what would change under CDS and information about how to prepare.

Communication from HMRC acted as a catalyst for preparation and organisations were waiting for more detailed information before taking action to prepare. Those organisations which had started to prepare were those which had received targeted communications about CDS from HMRC.

6.2 Action anticipated to prepare for CDS

To prepare for CDS third parties and unrepresented businesses expected to need to update any internal forms and processes to make sure the correct information was captured from clients to ensure the smooth processing of customs declarations. For example, third parties felt that they may need to capture the audit trail of previous document IDs.

Third parties and unrepresented businesses also felt that they would need to train colleagues making customs declarations to ensure they are familiar with and able to use the new system effectively. This was a cause of concern for some who were worried about how long it may take to make sure staff were able to use the new system confidently.

“When we get a new employee, it can sometimes take them up to 6 months before they can sit there by themselves and do a customs entry, our worry is that is it going to be like that for all of us then?” (Large, freight forwarder, submits daily)

“I imagine train up staff around it, make sure our software is able to work with it. But we’ll need the full scope of information before we can do that.” (Medium, freight forwarder, submits daily)

Third parties who used software felt they would need to consult with their provider about making any necessary upgrades, to ensure this was compatible with CDS and collected the required information.

6.3 Support to prepare for and transition to CDS

Customers wanted a number of mechanisms to support them to prepare for and transition to CDS. Their focus was on understanding the key differences between CHIEF and CDS and information which would help them to use CDS on a daily basis.

It was of prime concern that users could get immediate answers to queries. There was concern amongst third parties and businesses that any issues with CDS which caused customs delays could prove costly.

Participants wanted this support and information through a number of channels to maximise accessibility and to reflect their personal preferences. Support requested included:

written instructions on how to use the new system for those who are actively involved in the process as well as responses to FAQs about the new service
YouTube style video tutorials which explain and demonstrate visually how to navigate the site in the form of a ‘live’ demonstration or web tutorial
a dummy version of the new CDS system available in advance so they could familiarise themselves with the new system before transitioning
a live webchat or helpline (available day and night and on weekends, reflecting business practices) were seen as a way of getting a quick response to urgent queries, helping to avoid customs delays which could be costly
an online help tool was seen as useful to providing ongoing support whilst users familiarised themselves with the new system, particularly for third parties (who stressed the importance of having access to as much information and guidance as possible)

“Videos are often good, demonstrations help things to settle in that bit better.” (Large business, submits weekly)

“It would be nice to have a live chat thing on there… if you’ve got any simple questions but it helps alleviate any sort of doubts for people when they are going through it for the first time.” (Small business, submits weekly)

“Massive benefit will be the online help tool, it will give people additional resource, people like to take ownership for their job, you don’t want to be constantly asking your manager and supervisor.” (Large, unrepresented business, submits daily)

Training sessions or seminars for the most relevant colleagues to attend. Businesses and third parties felt that this would be delivered by HMRC colleagues and that attendees could then share the information within their organisations.

“Put on information giving sessions, bring people together and it gives us a chance for consultation…We might need to bring on new employees we don’t know. Back the information sessions up by info on their website, plus simple, clear English documents free of jargon so you don’t just put in the bin when it arrives in the letterbox”. (Small business, submits quarterly)

“We’re the only department [operations] that deal with customs entry, so it’d be easy for one or two of my team to get some really good training on this [CDS] and then train the rest of the team on it.” (Medium custom agent, submits daily)

Question 7

7.  Communicating the changes

Accepted Answer

7.1 Information customers need about CDS

Businesses and agents had similar information needs from HMRC and were both very practically minded regarding the transition from CHIEF to CDS. In particular, in order to be able to successfully transition to CDS, participants felt they needed detailed, practical information about the changes.

Questions customers wanted answering about the transition included:

what is changing
when is the change happening
how it will impact them on a daily basis
what they need to do to prepare in advance
when exactly (to the week) they need to be ready to transition

Businesses and third parties felt that a step-by-step guide to using CDS would be helpful to minimise disruption so that they know what to expect and can prepare and train staff in advance.

Customers also wanted information regarding how and where they could receive support when they needed it, to help with queries or concerns.

7.2 Communication mode

Customers felt that the news about CHIEF and CDS was very important, so they were open to hearing about it through a range of channels.

The preference for both businesses and third parties was to be contacted directly by post. This was perceived as the most official, secure and reliable way to receive important information from HMRC. It was important for an initial information letter to strike a balance between providing sufficient information to help businesses and third parties understand what the impact on them would be and not being too long, which they felt could create the risk of them missing key points.

“I think you’ve got to hit people at different angles. Some people prefer email, but when a HMRC letter comes through, you tend to pay attention to it.” (Large business, submits weekly)

For further information and guidance, participants preferred the letter to include a link to more information and FAQs on the GOV.UK website. Participants had a preference for a physical copy of the answers to FAQs and instructions on how to use CDS as they could keep this and refer back to it as and when needed.

The GOV.UK website was mentioned by customers as the first place they would go with questions. In particular, they would be looking for further, detailed information and online tutorials.

Social media channels were also seen as appropriate ways of raising awareness by reaching customers with news that CHIEF is changing and encouraging them to find out more. LinkedIn was seen as the most appropriate site for this due to its professional nature. Facebook and Twitter were more likely to be used for personal reasons and therefore messages of a ‘work-related’ nature may have less impact.

“Think about how much time everyone spends on social media. I think if they put information out on Facebook, Twitter, Instagram it can only be a good thing, because people are on it that … often they can’t miss it if it’s there!” (Small Freight Forwarder or Customs Agent, submits daily)

7.3 Messenger

Figure one below demonstrates the sources of information for both businesses and third parties to support communication about CDS. The flowchart shows the flow of information from HMRC to ‘businesses’. It starts with HMRC, with information flowing to ‘software providers’ and ‘trade organisations’. Information also goes to ‘customs agents and freight forwarders’, passed on from both ‘software providers’ and ‘trade organisations’, and also directly from HMRC. ‘Software providers’, ‘trade organisations’ and ‘customs agents and freight forwarders’ can then pass the information on to ‘businesses’. Additionally, information can flow to ‘businesses’ directly from HMRC.

Figure 1: potential information flow to support communication about CDS

As figure one and the text above show, both businesses and third parties wanted information directly from HMRC. Represented and unrepresented businesses and trade bodies saw this as essential. Information from HMRC was seen as the official line on when their organisation will transition, what will be different for them and what they need to do to prepare in advance.

Unrepresented businesses and third parties wanted detailed information on what they would need to do differently. Represented businesses wanted information directly from HMRC so they can check their agent is making submissions accurately under CDS as customs declarations are ultimately their responsibility.

“You don’t want second hand information from an agent… if it’s second hand information…no, it needs to come directly from HMRC.” (Small represented business, imports or exports weekly)

“HMRC should support both the agents and businesses tell both what they require and also a sense of what changes will be made to the processes and any changes in the coding.” (Small business, submits quarterly)

Customers were also open to receiving information from other relevant bodies. Organisations using CHIEF through third party software were open to hearing about the changes from their software provider. They felt it would be beneficial if their software provider could have advance sight of any changes, so they could be prepared before customers approached them with questions

Customers who were a member of a trade organisation, for example the British International Freight Association (BIFA) expected to hear about the changes from them as part of their membership. Changes to HMRC processes felt like the type of issue customers would hear about from this type of body and communications from them were seen as legitimising the changes. As such, it was also important for trade organisations to have early notice of the changes so that they could prepare briefings for their members

Customers who used an agent or freight forwarder were open to hearing about the changes from them. Third parties felt that customers who used an agent needed only light touch information as they do not have detailed knowledge about the process. They were open to providing information about CDS to their clients but would need information in advance to be able to share this and answer any questions

“To be honest it will go over a lot of customers heads really because all they’re really bothered about is when their goods will arrive and how much it’s going to cost them.” (Medium customs agent or freight forwarder, submits daily)

7.4 Timings for communications

Businesses and third parties wanted key information including deadlines between one and 3 months in advance of CDS being implemented. Those who were more worried about the change or felt they had more to do to prepare wanted information sooner.

“Personally, I’d want all the information as soon as possible. Things take time, training takes time, we’re in a contract with our agents, so the sooner the better for me.” (Large business, submits weekly)

Critically third parties wanted information before customers so they could answer any questions that may be raised as a result. Generally, software providers and agents were happy to provide this information to customers but they felt they needed more detailed and specific information about the transition to CDS before having these conversations.

“We can’t tell [customers] because as of now, we don’t really know.” (Medium customs agent, submits daily)

Question 8

8.  Conclusions

Accepted Answer

Amongst businesses, awareness and engagement with CHIEF was related to company size and whether or not they used an agent.

Third parties and unrepresented businesses demonstrated conflicting views of CHIEF. There was a belief that the system could benefit from an upgrade but this was countered with concerns about change and what it might mean practically to prepare and transition to a new system.

There was low awareness of the introduction of CDS amongst businesses, particularly regarding the details of the new system and how this might affect them practically on a daily basis. Awareness tended to be higher amongst larger businesses who were more likely to submit customs declarations more frequently and therefore were more engaged with the process. Although third parties were more informed about CDS than businesses there were pockets of very low awareness amongst smaller agents.

Due to this low awareness, there was little evidence of businesses or third parties having taken action to prepare except for the largest organisations who had been contacted directly by HMRC. Organisations were generally waiting for more explicit information and guidance from HMRC about how CDS would affect their everyday work before starting to prepare in earnest. Represented businesses thought they would not have to do much to prepare for CDS, except maybe giving more information to their agent. Third parties and unrepresented businesses needed more detail and expected that they may need to update their software, internal processes and client facing materials and provide training to staff.

HMRC was seen as a key messenger of the changes. Unrepresented businesses and third parties wanted a step by step guide to CDS and represented businesses, a prompt to contact their agent to make sure their customs declarations will continue to be made accurately. Due to the perceived importance of the introduction of CDS customers were open to hearing about this from a range of channels. The preferred method of initial communication was an overview letter from HMRC. Ideally this would be supported by a leaflet giving more detailed information and signposting to more information online. Social media sites such as LinkedIn and Twitter were also deemed appropriate for raising awareness. Customers were also receptive to hearing about CDS from software providers, third parties and industry bodies.