Guidance

The Union Customs Code

Import, export and storage procedures following the introduction of the Union Customs Code (UCC).

Changes under the UCC

The UCC was introduced across the European Union (EU) on 1 May 2016.

There are a number of changes to how goods cross EU borders and some transitional arrangements will operate until 2020.

The UCC requires all commercial users to submit their customs declarations electronically

The main changes from 1 May 2016 were:

  • mandatory guarantees for most special procedures and temporary storage (TS) – this only applies to new authorisations
  • the ability to make some movements under TS rather than national transit or the New Computerised Transit System (NCTS)
  • the removal of the earlier sales provisions relating to valuation – but there are some transitional arrangements
  • all communications between customs authorities and economic operators must be electronic

Some procedures and reliefs ended or changed on 30 April 2016, these are:

  • the 10 euros waiver of Customs Duty for free circulation customs declarations - where Customs Duty is payable no de-minimis exemption will apply - this does not affect any Community System of Duty Reliefs (CSDR)
  • goods being declared to Onward Supply Relief (OSR) (customs procedure code 42 series) - can only be entered using a full customs declaration or the Simplified Declaration Procedure (SDP)
  • the use of information sheets for Special Procedures (INF) documents with an Entry in Declarant’s Records (EIDR)
  • Inward Processing Drawback (IP (D)) and Low Value Bulking Imports (LVBI) authorisations are no longer valid and these authorisations cannot be used to import goods regardless of any expiry dates shown on your authorisations
  • Processing under Customs Control (PCC) authorisation holders have been given an Inward Processing (IP) authorisation number which must be used for all importations
  • type D customs warehousing authorisation holders have been given a new authorisation number with a prefix of C (for type D authorisation), or E (for a type E warehouse with type D rules of assessment) - these must be used for entries to customs warehouses
  • goods being declared to LVBI will only be entered using an SDP authorisation

System changes

HMRC expects that some changes to economic operators’ systems will be needed. However this will depend on which authorisations are held and what procedures or processes individual businesses use. A plan for major IT changes is already in place.

The Multi-Annual Strategic Plan (MASP) and supporting legislation contained in the work programme gives:

  • dates by which functional specifications must be provided
  • the proposed implementation dates between 2016 and 2020

In addition to the MASP, a number of other transitional arrangements for IT systems have been introduced. This will balance the transition of new data requirements with the introduction of new IT systems.

Earlier sales rules

The earlier sale facility has been withdrawn and replaced by a last sale only rule. There was a transitional measure by which any binding contracts containing a reference to an earlier sales agreement could be used until 31 December 2017.

Royalties and licence fees

Under the UCC, royalties and licence fees will generally be paid as a condition of the sale of the goods and should be included in the customs value.

Guarantees

Under the UCC there are some circumstances where the provision of a customs guarantee is mandatory.

The regimes and procedures concerned are:

  • Inward Processing
  • Outward Processing (OP) with prior importation or under the Standard Exchange System
  • Temporary admissions (TA) where the UCC does not provide for an outright guarantee exemption
  • end use
  • temporary storage
  • customs warehousing

You can apply for a CCG using form CCG1.

Temporary storage

The UCC introduces 4 main changes for Temporary Storage:

  • mandatory guarantees
  • ability to move goods under Temporary Storage (rather than transit)
  • new data sets for TS declarations
  • maximum of a 90-day storage period

Entry in Declarants’ Record (EIDR)

Scope of EIDR

EIDR allows you to enter goods to a customs procedure without the need to provide a full customs declaration at the point of release. It enables operators to manage cash-flow by allowing them to provide fiscal data at a later date.

It also removes the requirement for a supplementary declaration when entering goods to a customs warehouse. However, there will still need to be a way of collecting trade statistics.

EIDR can be used to enter goods to:

  • free circulation
  • customs warehousing
  • Inward Processing
  • Outward Processing
  • end use
  • temporary admission
  • export
  • re-export

EIDR cannot be used to enter goods for:

  • temporary storage
  • Onward Supply Relief
  • transit
  • any special procedure where an INF form is required
  • low value import procedures (LVBI replacement)
  • pre-departure declarations, indirect exports and exports of excise goods

EIDR is a 2-part declaration process, the initial entry in the records followed by a supplementary declaration to be submitted within one calendar month.

You’ll need to provide an electronic notification that the goods have been entered in the records unless a waiver is granted. Statistics will generally be collected, as now, from the supplementary declaration.

Simplified Declaration Procedure (SDP)

SDP allows you to enter goods to a customs procedure without the need to provide a full customs declaration at the point of release. It enables operators to manage cash-flow by allowing them to provide fiscal data at a later date. It also removes the requirement for a supplementary declaration when entering goods to a customs warehouse. However, there will still be a need to continue to collect trade statistics.

SDP also removes the requirement for a supplementary declaration when entering goods to low value imports (LVBI replacement) or OSR. These Simplified Frontier Declarations have an increased data set which means a supplementary declaration is not needed for these goods.

SDP can be used to enter goods to:

  • free circulation
  • customs warehousing
  • Inward Processing
  • Outward Processing
  • end use
  • temporary admission
  • export
  • re-export
  • low value import procedures (LVBI replacement)
  • Onward Supply Relief on removal from customs warehousing

Data and declaration requirements

SDP is a 2-part declaration process, the initial entry is followed by a supplementary declaration which must be submitted within one calendar month, unless specifically exempted.

Guarantees

Depending on the customs procedures used, a guarantee will be required for imports.

Special Procedures

The UCC introduced ‘Special Procedures’ made up of:

  • processing – Inward and Outward
  • specific use – temporary admission and end use
  • transit - external and internal transit
  • storage - customs warehousing and free zones

Most Special Procedures are subject to some form of transition. If you have a pre-UCC special procedures authorisations, you will need be reauthorised before 1 May 2019.

Transitional arrangements

IP drawback authorisations ceased to be valid after 30 April 2016. IP (D) authorised businesses who wished to continue to import goods to IP required a new UCC IP authorisation (including a guarantee).

Goods cannot be imported to PCC after 30 April 2016. PCC authorisation holders are able to use their PCC authorisations to import their goods to IP during the transition period. They’ll also be able to use their PCC authorisation until it expires or 30 April 2019, whichever is earliest.

You are able to use type D warehousing authorisations to import goods to customs private warehousing arrangements during the transition period until the warehousing authorisation is reassessed, or 30 April 2019, whichever is earliest.

Type D warehousing authorisation holders have a new authorisation number with a prefix of:

  • C (if it was previously only a type D authorisation)
  • E (if it was previously a type E with D)

Authorisations that were granted under the Community Customs Code (Reg. No. 2913/92) can still be used to enter goods to the special procedure until the date of expiry or 30 April 2019 whichever is earliest. This applies to:

  • Inward Processing (suspension)
  • Outward Processing
  • end use
  • temporary admission

Economic operators need to re-apply and must have their new authorisation for these procedures in place by 1 May 2019 to retain the special procedure.

Authorisations for storage that were granted under the Community Customs Code (Reg. No. 2913/92) can still be used to enter goods to the special procedure until the authorisation is reassessed. This covers authorisations for:

  • customs warehousing
  • free zone

The criteria and conditions stipulated in the code will need to be met when the reassessment takes place. This must be no later than 1 May 2019.

Once Community Customs Code (Reg No. 2913/92) authorisations for Military End Use are reissued as UCC authorisations, the goods (under Council Regulation 150/2003) can only be entered to end use by the Ministry of Defence, under their own authorisation.

Sub-contractors must apply for and use IP instead. Sub-contractors can continue to use their end use authorisations for these goods until the authorisation expires or 30 April 2019, whichever is earliest.

Goods entered to certain special procedures on or before 30 April 2016, but discharged on or after 1 May 2016, must be discharged under the UCC rules. These procedures are:

  • end use (this includes the requirement for a Bill of Discharge to be submitted)
  • customs warehousing (with the exception of type D)
  • Inward Processing (suspension)
  • Processing under Customs Control

Other goods entered to special procedures on or before 30 April 2016, but discharged on or after 1 May 2016, must be discharged under the Community Customs Code (Reg No. 2913/92) rules. The procedures involved are:

  • Inward Processing drawback
  • temporary admission
  • customs warehousing type D
  • Outward Processing

Goods entered before 1 May 2016 to a type D customs warehouse can only be removed using the type D rules of assessment until 31 December 2018.

Authorisation by the submission of a declaration

Authorisation of a declaration for a special procedure (other than customs warehousing and transit) remains available under the UCC.

UK policy is to limit this form of authorisation to 3 times a year for each operator. Any entries by this method will require a guarantee and will be accepted under UCC rules.

Submission of an application for special procedures

Where an authorisation has a specific end date, the authorisation holder should submit their application at least 30 days before the authorisation is due to expire. HMRC will not remind you that the authorisation is due to expire.

Where an authorisation has no specific end date, HMRC will contact you and arrange the reassessment of your authorisation. Only contact HMRC if you want to vary the terms of your customs warehousing authorisation (for example, by the use of retail sales).

If you want to vary your authorisation, your application should be submitted at least 60 days before the date on which you wish to start your new activities.

Electronic movement of goods under special procedures

Under Article 6 of the UCC, any communications between member states and economic operators must be electronic. The movement of goods under a special procedure can be carried out without customs formalities and is not subject to the requirements of Article 6.

‘VAT-only’ special procedures

Goods that are only liable to import VAT can be declared to IP and TA if the reason for using the relief is not purely cash-flow. However, a guarantee will be needed so operators may want to consider if it’s economically viable to use the relief when goods are duty free. Policy on other special procedures is still under consideration.

Inward Processing

Guarantees

To operate IP, you need to provide a financial guarantee, subject to any transitional arrangements. If you can meet certain criteria, you may be able to obtain a guarantee waiver or reduction.

Re-exporting processed products

The requirement to re-export processed products has been removed, as has the compensatory interest applicable when goods are released to free circulation.

You’ll normally be able to choose how the amount of duty payable on release to free circulation can be worked out. This can be on the basis of either:

  • imported goods
  • processed products

IP drawback authorisations

The drawback arrangements were withdrawn on 1 May 2016. While goods cannot be entered to drawback on or after 1 May 2016, goods entered into drawback before that date can be kept under the procedure until the expiry of the throughput period.

Provided that the goods are correctly disposed of (for example, by export), drawback claims can be submitted and duties repaid.

Customs warehousing

Guarantees

Subject to any transitional arrangements, to operate a customs warehouse you’ll need to provide a financial guarantee. If you can meet certain criteria, you may be able to obtain a guarantee waiver or reduction.

Type D customs warehouses

You cannot enter goods to a type D customs warehouse on or after 1 May 2016. However, if you entered goods before that date they can be kept under type D arrangements until they’re correctly disposed of (for example, by release to free circulation).

The charging rules appropriate at the time of entry can be kept until 1 January 2019.

Retail sales from a customs warehouse

You can make retail sales from the premises of a customs warehouse provided that it’s by:

  • the internet
  • catalogue
  • any other distance selling method

You cannot invite customers into the premises of the customs warehouse to make face to face retail sales. Sales are permitted to both EU and third country customers.

End use

Guarantees

Subject to any transitional arrangements, to operate end use you need to give a financial guarantee. If you can meet certain criteria, you may be able to obtain a guarantee waiver or reduction.

Temporary admissions

Waivers or reductions for guarantees taken for TA

Where a comprehensive guarantee is used a waiver or reduction may be available.

Retroactive authorisations for persons not established in the EU

Where an authorisation can normally be issued to a non-EU person, an application for a retroactive authorisation by a third country person is allowed.

Transit

From 1 May 2016 UK national transit simplifications used in port/airport inventory systems ended.

Transport documents used as a transit declaration

Current authorisations can continue to be used until they’re re-assessed by 1 May 2019.

If you use an electronic system now and the data elements for the electronic transport document differ, you have until 1 May 2019 or until reassessment to add these to your systems.

Other transit simplifications

Simplifications for authorised consignor, authorised consignee and the use of seals of a special type, continue to be available. There is also a new simplification allowing the use of a customs declaration with reduced data requirements.

This is available to operators of rail, air and sea transport.

You do not need to hold an AEO authorisation to apply for transit simplifications. However, you need to demonstrate that you can meet certain criteria.

Proof of Union Status (PoUS)

Electronic T2L

Following the introduction of the EU PoUS system:

  • T2Ls and T2LFs have to be submitted using the electronic system
  • customs manifest and invoice declarations can only be used for goods under the value threshold of 15,000 euros

Under the UCC, you can become an authorised issuer of PoUS for:

  • customs manifests up to the value threshold of 15,000 euros
  • T2Ls and T2LFs of any value

If you want to be an Authorised Issuer for PoUS under the UCC you’ll need to have:

  • a satisfactory compliance history in customs and other taxation areas
  • agreed access to your commercial and customs records
  • satisfactory procedures for managing customs documentation
  • adequate IT security to protect systems and data

Exports

Presenting an Export Accompanying Document (EAD) at the office of exit

A paper version of an EAD no longer needs to be presented at the office of exit with the goods. Instead, you only need to let the office of exit know the Movement Reference Number of the export declaration when you present the goods for exit from the EU. You may wish to continue to take an EAD with the goods during the IT transition period to the UCC.

Export simplifications

A new simplified EIDR operates under the UCC.

EIDR can only be used for direct exports, non-excise goods and where a pre-departure declaration is waived.

Export transit movements

The changes to exports that require a transit movement under the UCC are:

  • when a non-excise export is entered to the transit procedure, the customs office of departure is the customs office of exit
  • non-excise goods placed under external transit are exited from the Union when they’re put under the external transit procedure
  • where excise duty suspended goods are moving under transit, the customs office of exit remains the competent office where goods leave the territory of the Union

Right to be heard: exceptions

The introduction of the ‘right to be heard’ in the UCC for adverse customs decisions does not apply where:

  • the application for a decision, including the application for registration and assignment of an EORI number, may not be accepted
  • the customs authorities notify the person who lodged the entry summary declaration for containerised maritime and air traffic, that the goods are not to be loaded
  • the decision concerns a notification to the applicant of a Commission decision as referred to in Article 116(3) of the Code
  • an invalidation of an EORI number occurs
Published 24 October 2014
Last updated 7 September 2018 + show all updates
  1. This page has been updated with changes to the Union Customs Code.
  2. Paragraph about transitional arrangements for guarantees has been updated.
  3. The temporary storage guidance has been updated because of the implementation of the Union Customs Code.
  4. This guide has been updated to reflect the latest information on the introduction of Union Customs Code.
  5. Provides further updates on the planned changes to import and export procedures under the new Union Customs Code (UCC).
  6. First published.