The Customs and Excise Border Procedures (Miscellaneous Amendments) (EU Exit) Regulations 2021
Published 21 July 2021
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Who is likely to be affected
Businesses and intermediaries importing or exporting goods through mainland Great Britain (England, Scotland and Wales) border locations that do not have sufficient space to apply full customs controls and implement the traditional temporary storage model, border location operators, carriers and hauliers involved in the movement of such goods.
General description of the measure
This measure introduces a number of targeted legislative changes that will allow customs procedures to continue to operate efficiently and will help facilitate the movement of goods between Great Britain and the European Union (EU) once staged customs controls have ended. This includes:
- ending temporary easements to customs controls at border locations which did not have customs control systems at the end of transition
- applying full customs controls to goods imported at border locations where declarations need to be pre-lodged in advance of arrival and to goods exported at border locations without space to operate normal export processes
- allowing goods with pre-lodged temporary storage declarations to be imported via border locations without temporary storage facilities and transported directly to an inland temporary storage facility
Policy objective
To ensure that the UK maintains an effective system of customs controls, including simplifications of customs requirements where appropriate.
Background to the measure
Border controls for EU goods imported into Great Britain were introduced at the end of the transition period in stages to give businesses affected by coronavirus more time to prepare. Until 1 January 2022, border locations without existing customs control systems at the end of the transition period are not required to control goods on the basis of declarations. Whereas from 1 January 2022, full customs controls will apply to all border locations in Great Britain which move goods destined for imports and exports.
The government announced in the Border Operating Model (dated 8 October 2020) that goods with pre-lodged temporary storage declarations may be imported via Great Britain border locations without existing customs control systems and transported to a temporary storage facility in Great Britain provided they meet specific requirements. Existing legislation is sufficient to provide cover in the short term only.
HMRC remains in frequent contact with importers, exporters and their representatives in relation to customs matters, including changes to the customs legislations.
Detailed proposal
Operative date
This instrument will take effect from 1 January 2022. The changes relating to the listing process of locations will take effect from 4 August 2021.
Current law
The instrument is made under the Taxation (Cross-Border Trade) Act 2018 (the TCTA). This Act, and the regulations made under it, provide the basis of the UK’s customs rules.
Legislation listing ro-ro (roll on roll off) and other locations and the requirements for pre-lodgement of customs declarations is in Part 13 and Part 13C of the Customs (Import Duty) (EU Exit) Regulations 2018. Legislation for notification of importation and acceptance of declarations at ro-ro and other listed locations is in Part 2 of the same regulations.
Legislation on goods exported from ro-ro listed locations is in Part 6 of the Customs (Export) (EU Exit) Regulations 2019. Legislation on modified export controls is in Part 2 of the Customs (Declarations) (Amendment and Modification) (EU Exit) Regulations 2020.
Legislation on Temporary Storage is in Part 3 of the Customs (Import Duty) (EU Exit) Regulations 2018.
Proposed revisions
This instrument removes Part 2 of the Customs (Declarations) (Amendment and Modification) (EU Exit) Regulations 2020 and makes amendments to the Customs (Import Duty) (EU Exit) Regulations 2018 and the Customs (Export) (EU Exit) Regulations 2019.
Where pre-lodgement of declarations is required carriers will be required to notify HMRC when the vessel, aircraft or train carrying the goods has embarked for Great Britain. This must be done at the latest point of no return as part of operating the Goods Vehicle Movement Service (GVMS), or an equivalent system.
For controlled goods, such as alcohol and tobacco, there will no longer be a requirement on businesses to notify HMRC by its IT system by 11:59pm the day after the day on which the goods were imported, or to make an entry to the Excise Movement and Control System for excise duty suspended goods.
Where pre-lodgement is required at “other” listed locations, declarations must be made before goods are loaded rather than before the goods are imported, and after this time declarations cannot be amended or withdrawn without permission, except for information specified in a notice.
This instrument allows other locations where HMRC considers that the location does not have sufficient physical space in which to operate the processes for full customs controls used at all other border locations (the standard export procedure) to be listed so that ro-ro export modifications will apply to non-ro-ro locations which lack space.
Where ro-ro export modifications apply, carriers will be required to verify that all goods permitted to be loaded for export onto vessels, aircraft and trains have Permission to Progress.
Messages will need to be sent to HMRC confirming that goods have left Great Britain for all goods exported from such locations, but this will be done automatically by the Goods Vehicle Movement Service (or an alternative equivalent system) and require no action by exporters. This means that where excise duty suspended goods (such as alcohol or tobacco products) are exported through these locations, traders or the location will no longer need to confirm manually to HMRC that the goods have left Great Britain.
Where required, those involved in moving goods through these locations, and declarants, may still need to provide evidence a declaration has been made.
Where certain goods are exported through ro-ro listed locations and are declared by conduct (for example, vehicles and containers), the processes laid down in the Regulations are modified to take account of the particular challenges of those locations, such as lack of space or infrastructure to carry out declarations. This instrument allows HMRC to apply those modifications at other export locations with similar issues.
For exports that depart from border locations without space to operate customs checks at the port’s premises, goods will be subject to customs compliance checks at an inland border facility when required.
Where pre-lodgement of declarations is required, business will be able to import temporary storage goods through border locations without temporary storage facility by pre-lodging a temporary storage declaration into the relevant inventory system and transporting them directly to an inland temporary storage facility.
This instrument also makes minor changes to process by which HMRC Commissioners issue lists of ro-ro and other border locations.
Summary of impacts
Exchequer impact (£million)
| 2021 to 2022 | 2022 to 2023 | 2023 to 2024 | 2024 to 2025 | 2025 to 2026 | 2026 to 2027 |
|---|---|---|---|---|---|
| Empty | Empty | Empty | Empty | Empty | Empty |
Costings, where required, will be subject to the scrutiny by the Office for Budget Responsibility and included in their forecasts at a future fiscal event.
Economic impact
This measure provides economic certainty to border location operators, carriers and traders by implementing full customs controls and a new movement of temporary storage.
This measure is not expected to have any significant macroeconomic impacts.
Impact on individuals, households and families
There is expected to be no impact on individuals as this measure only affects businesses. This measure is not expected to impact on family formation, stability or breakdown.
Equalities impacts
It is not anticipated that there will be impacts on groups sharing protected characteristics.
Impact on business including civil society organisations
This measure is expected to have a negligible impact on the border industry including border locations, carrier and haulage companies and those who import or export goods through these locations. Information requirements for this measure are the same as for temporary storage and it is anticipated that the process for submitting this information will not be more burdensome.
The changes provide an alternative process of clearing goods through locations without temporary storage facilities aimed at maintaining the flow of goods and is optional depending on the requirements of each border location.
One-off costs for businesses will include familiarisation with the changes. Drivers or hauliers may also need to register for the service, which is a web based free to use service provided by HMRC. Port operators and carriers who decide to use the service may have to opt into the changes and modify and update their IT systems to be compatible with the HMRC system, this will be supported by HMRC’s IT department. All businesses affected by the change may need to provide training for their staff to be able to use the new systems and ensure they know what they need to do.
Continuing costs may include having to monitor for updates to the system and update their systems and processes as they arise. Businesses will receive support for this from HMRC.
This measure is expected overall to improve businesses experience of dealing with HMRC as it is an optional alternative to the temporary storage customs control model which some ports do not have the facilities to support. In addition, the solution developed is in direct response to needs highlighted by stakeholder engagement.
There is expected to be no impact on civil society organisations.
Operational impact (£million) (HMRC or other)
Certain processes with resources will be required by HMRC to support compliance. This resource will not be additional. One-off resource costs will be incurred by Border Force on communicating the changes to HMRC front-line staff.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
This measure will be monitored through information collected through Border Force and HMRC IT systems and will be kept under review through communication with affected taxpayer groups and other government departments.
Further advice
If you have any questions about this change, contact Aulia Beg in the Customs Control policy team by email: aulia.beg@hmrc.gov.uk.
Declaration
The Right Honourable Jesse Norman MP, Financial Secretary to the Treasury, has read this tax information and impact note and is satisfied that, given the available evidence, it represents a reasonable view of the likely costs, benefits and impacts of the measures.