Guarantee Requirements for Customs Authorisations and Approvals: Joint Contractual Liability Guarantors
JCLs must be refused where the JCL guarantor fails to meet the Proven Financial Solvency Criteria detailed in section CAA09150 Financial Solvency of applicants.
Solvency checks on the JCL guarantor should be undertaken on an annual basis.
JCLs will only be accepted from non-EU guarantors where it is being provided as security for an AEOC’s activities.
JCLs for all other applicants must be established in the territory of the customs Union.
The JCL is a contractual arrangement between the Guarantor and HMRC, to cover all debts relating to the applicant’s use of a particular customs procedure or authorisation, for example:
Joe Bloggs Incorporated applies for Temporary Storage
Joe Bloggs Incorporated compliance and solvency assessments demonstrate a low risk to the revenue but does not meet criteria for a full waiver
Joe Bloggs Incorporated must provide security for the goods held in temporary storage in order to gain approval
Joe Bloggs Incorporated agrees with Joe Bloggs UK Limited (a completely separate legal entity) to act as JCL guarantor for the temporary storage approval
Joe Bloggs UK Limited meets the Financial Solvency Criteria
Joe Bloggs UK Limited undertakes, via a JCL to HMRC, to cover all debts incurred by Joe Bloggs Incorporated in the event that they (Joe Bloggs Incorporated) fail to pay HMRC on demand.
JCLs must be provided using the template detailed in section CAA11100 Authorising Comprehensive Guarantees.