Security: Introduction, UK provisions and revenue risk indicators
Section 6 of Notice 226 gives full details on financial security.
All UK movements of beer must be through the Excise Movement and Control System (EMCS), unless the movement qualifies for the simplification procedures for certain intra-company movements. Further information on EMCS can be found in Notice 196 Excise goods: authorisation of warehousekeepers, approval of premises and registration of owners, Notice 197Excise goods: receipt into and removal from an excise warehouse of excise goods and on simplification procedures in paragraph 9.12 of Notice 226.
Provisions for UK movements are covered by The Excise Goods (Holding, Movement and Duty Point) Regulations 2010 (Parts 5, 8 and 9).
Regulation 12 of the Beer Regulations provides for the requirement for a guarantee for beer held in duty suspension on registered premises within the UK. However, a guarantee will be required only when there is perceived to be a risk to the revenue, for example, the trader has a poor compliance history or the business is known to be experiencing financial difficulties.
Current registered traders: The trader’s compliance record is to be examined to form an overview in respect of risk posed to the revenue. To this end, the following factors (in ascending order of significance) are worthy of consideration as indicators of risk:-
- fraud/offence case history;
- civil penalties previously imposed;
- incidence of under declarations and/or irregularities;
- late and/or non-payment of returns or assessments;
- incidence of warning letters (breaches of approval conditions, etc.);
- reliability of traders’ management controls; and
- traders level of co-operation in revenue matters.
If the overview indicates that a trader is a significant revenue risk, you will need to assess the deterrent effect of imposing security in relation to other available measures; such as the withdrawal of approval to hold beer in duty suspense or taking future civil/criminal offence action. It is important to consider all such enforcement options and to select the most effective revenue safeguard in the prevailing circumstances.
New traders: All traders applying for registration are subjected to a structured process of pre-registration checks -BEER2130 ‘Revenue risk’ gives further details.