Authorised Economic Operator Criteria - Maintaining the Standards
Information on Authorised Economic Operator Criteria - Maintaining the Standards.
This section tells businesses what they must do once they have obtained Authorised Economic Operator (AEO) status to ensure that they maintain their eligibility for AEO authorisation.
Businesses are responsible for ensuring they maintain the appropriate standards.
HMRC will review authorised businesses’ AEO status periodically to ensure they continue to meet the conditions and standards of the AEO status. Although the authorisation has no expiry date, it will only remain valid for as long as the conditions of the authorisation are met.
Regular monitoring is the primary responsibility of the business. It is recommended that they continue to self-assess their compliance with the conditions of the authorisation and action any identified problems as soon as they arise.
HMRC will review the AEO status if there are major changes to the relevant customs legislation.
If HMRC has reason to think the business is no longer meeting one or more of the AEO criteria it may lead to reassessment of the authorisation. This may be as a result of monitoring by HMRC, a major change in the operation of the business, changes advised by the business or information provided by other government authorities.
As an AEO it is important the business understand their obligations and how to notify any changes to HMRC.
Businesses must notify HMRC of all changes that may affect their AEO status. This includes but is not limited to:
- changes to the legal entity
- change of business name
- business address
- the nature and structure of the business
- changes to the senior personnel responsible for customs matters listed in the application/questionnaire
- changes to accounting or computer systems
- additions or deletions of locations or branches involved in the international supply chain
- additions or deletions to the categories the business has been approved for, that is, manufacturer/exporter for example
- changes to other authorisations/approvals which may impact on AEO, in particular Regulated Agent or Known Consignor status
- changes to key personal
- disclosure of security incidents
Businesses should notify the AEO Central Site as soon as the change is known or, at the latest, within 14 calendar days of the change taking place. Changes should be notified using the C122 form on GOV.UK. The C122 will only be accepted if it has been completed by the person who is the designated point of contact within the business.
Should a business fail to inform AEO Central Site of changes that may affect their AEO status without delay, they may be subject to a Customs Civil Penalty under the Customs (Contravention of a Relevant Rule) Regulations 2003 Schedule of contraventions
If the legal entity changes, it will be necessary to reapply for AEO status in the name of the new legal entity. The AEO Central Site will advise if a new application and questionnaire are required.
Notifying HMRC of errors.
If a business makes customs errors, they must be reported to the supervising office. If no other customs authorisations are held errors should be reported to AEO Central Site.
Errors that are voluntarily disclosed will not normally impact on your AEO authorisation provided you have:
- examined the reasons for the errors
- taken the appropriate remedial action to prevent a recurrence
HMRC may suspend an AEO authorisation in either of the following cases:
- where HMRC have sufficient reason to believe that an act liable to give rise to criminal court proceedings and linked to an infringement of customs rules has been perpetrated
- where non-compliance with the conditions or criteria for the authorisation has been detected and no remedial steps have been taken within 30 days of the non-compliance arising. In certain circumstances this period can be extended provided that HMRC are satisfied that the difficulties can be overcome within a reasonable period
The authorisation holder will be contacted prior to any decision to suspend their authorisation is made.
For UK Authorised Economic Operator Customs Simplification (AEOC) authorisations granted under the Taxation (Cross-border Trade) Act 2018 and The Customs (Import Duty) (EU Exit) Regulations 2018, the suspension period can be up to 60 days. For UK Authorised Economic Operator Security and Safety (AEOS) and Northern Ireland AEOC and AEOS authorisations the suspension period is 30 days. If HMRC are satisfied the issues have been resolved the suspension can be ended sooner.
Any decision taken will be subject to the right of review or appeal.
Businesses can request their authorisation is suspended if they discover irregularities and need time to correct the situation. HMRC may agree a period of suspension with the business in order to address the problem. If necessary, this period can be extended provided that HMRC are satisfied that the difficulties can be overcome within a reasonable period.
Businesses who wish to suspend their AEO authorisation should contact AEO Central Site. They should provide details of the:
- reason for the request for suspension
- provide an action plan which identifies the issues and actions to be taken by the business
- a timescale for successful implementation of the plan and return to meeting the AEO criteria
HMRC has the right to refuse a request for voluntary suspension if it does not relate to fulfilling the AEO criteria or obligations. HMRC may also refuse a request if they do not feel the business has a realistic improvement plan. The timescale for implementation must be agreed with HMRC.
If HMRC is satisfied that the problems affecting the authorisation have been satisfactorily resolved, they will write to the business advising that the suspension has been withdrawn.
If the authorisation is suspended part way through a customs procedure, that procedure will be allowed to continue to its conclusion, but no new procedure can be started after the suspension has been notified.
In the following circumstances, an AEO authorisation will be revoked where:
- the authorisation has already been suspended and the authorisation holder fails to take the necessary remedial action to have the suspension withdrawn
- the authorisation holder has requested that their authorisation is suspended, and they fail to take the necessary remedial action to have the suspension withdrawn
- the authorisation holder has committed serious infringements relating to customs rules and does not have any further right of appeal
- the authorisation holder ceases to satisfy any of the eligibility criteria or conditions of their AEO authorisation
- the authorisation holder requests a voluntary revocation to withdraw their AEO status
If the authorisation is revoked by HMRC for not meeting the full standards of AEO, the holder will not be entitled to reapply for AEO authorisation for a period of 3 years from the date of revocation. The holder will be contacted prior to any decision to revoke their authorisation being made. The revocation will apply from the day following the holder being notified. Any decision taken will be subject to the right of appeal.
If HMRC establishes that an AEO authorisation was:
- granted based on incorrect or incomplete information and the original application was knowingly deficient
- the applicant should reasonably have known the original application was deficient and incorrect or incomplete information was provided
- HMRC would not have granted the AEO status if the correct and complete information was provided in the application
HMRC can annual the AEO authorisation and treat it as if it had never been issued. In case of annulment, the applicant would not be entitled to reapply for AEO authorisation for a period of 3 years.
If a business no longer wishes to hold AEO authorisation they should notify AEO Central Site using the C122. This is known as a voluntary revocation however when an authorisation is revoked at the holder’s request, the holder can reapply at any time as the 3-year exclusion from holding AEO does not apply.
If a business holds both AEOC and AEOS and the non-compliance only affects one of your authorisations, HMRC can suspend or revoke that authorisation.
For example, HMRC can suspend or revoke the AEOS authorisation if the holder fails to maintain security and safety standards but retain AEOC authorisation if that authorisation remains unaffected.
If an AEO authorisation is suspended or revoked, it does not automatically mean the loss of other authorisations (for example, customs warehousing or simplified procedures) that are held at that time. However, the customs office supervising any authorisations that are held will be informed of the suspension, revocation or voluntary revocation of the AEO authorisation. The supervising office will look at the reasons for the suspension or revocation of the authorisation and consider whether or not the non-compliance or voluntary revocation impacts upon the ability to continue to hold the authorisations.
If you do not agree with a decision, you can:
- ask for a review by an independent HMRC Officer by writing back to HMRC within 30 days of the date of the letter, giving your reasons for disagreeing with the decision
- appeal direct to the tax tribunal who are independent of HMRC
If you choose to have your case reviewed, you can still appeal to the tribunal if you disagree with the outcome.
In the decision letter HMRC offer the opportunity for a review by an independent HMRC Officer or appeal to the tax tribunal and tell you how to do so. For further information please see Disagree with a tax decision or penalty - GOV.UK