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HMRC internal manual

Customs Civil Penalties Guidance

Warning letter: considering whether to issue a warning letter: establishing who is to be warned

The compliance officer must identify the legal entity responsible for the contravention.

It may be the trader, in which case you need to decide to whom within the trader’s organisation you should address a warning letter. Normally this would be a senior responsible person within the company such as the Company Secretary or Managing Director.

In some instances the agent may be responsible for a contravention, depending on whether they are representing a trader directly or indirectly, see CCPG11120. If so you should address the warning letter to the agent.

In some instances an agent may delegate the making of a declaration to a sub-agent, either in a direct or indirect capacity. If so you should address the warning letter to the sub-agent.

It is also possible that a third party may purport to act as an agent, but there is no evidence that they are empowered to do so, see CCPG11120. If so, it is only the third party who can be liable to a penalty and the penalty notice should be addressed to them.

There may be occasions where responsibility for a contravention lies with both the agent and the trader. This is because the law places the responsibility for the accuracy of the declaration, authenticity of documents and compliance with obligations on the trader as well as the agent.

The guidance below explains who to send the warning letter to in specific circumstances.


Where there is an incorrect declaration

The person who made the declaration is normally responsible for the contravention. In some instances this will be an agent acting either directly or indirectly on behalf of the trader.

However, where the incorrect declaration is caused by a trader providing inaccurate or incomplete instructions to the agent, it is the trader who is responsible.

In the case of ‘indirect representation, both the agent and trader will be liable to CCP action

Compliance officers must consider the facts of each case on its merits. They should bear in mind that most agents provide a recognised specialist service and should have a good understanding of customs law and procedures.

There are occasions where it should be obvious to the agent that the client’s instructions conflict with the law. In such cases the agent cannot rely on the protection normally afforded them by client instructions.

Where the conditions of an authorisation have been infringed

The authorisation holder is responsible for ensuring that the conditions of the authorisation are met. Where a contravention is identified relating to their authorisation, for example where they have imported goods using their authorisation but those goods are not covered under the terms of their authorisation, the authorisation holder is normally liable to CCP action, even if the contravention is caused by an employee acting on behalf of the authorisation holder.

In some cases, an authorisation holder may engage a third party, such as a haulage contractor, to act on their behalf. The responsibility is still with the authorisation holder in such cases. They should take care to ensure that the third party is aware of their obligations and complies with them. The only time that we should consider CCP action against the third party is where the third party has clearly acted outside the terms under which they were engaged. In such circumstances the authorisation holder could not reasonably have been expected to have stopped this happening, for example where goods have been irregularly removed from temporary storage. While we might consider CCP against the authorisation holder, in such circumstances it may well be that they have a reasonable excuse, see CCPG11700.

Where the trader is non UK based/registered

CCPs apply to entities that have committed contraventions in the UK. It is possible that such entities may be based outside the UK, in which case the issue is the practical one of getting them to pay any penalty due.

If it is considered worthwhile in the interest of increasing compliance, the warning letter should be issued ‘care of’ the representative in the UK. It would only be permissible to address the warning letter to the representative if the representative would be liable to a penalty as specified in the penalties schedule.

Where a company is located on a single site

In the case of single site companies, the warning letter should be addressed to the Company Secretary, or a person of equivalent status at Director Level if the position of Company Secretary is not held.

Where a company is located on more than one site

Many national companies (including freight agents) have offices all over the country. We may find that we have problems with one or several of these offices. In such cases, if the Company Secretary is based at the site at which the contravention occurred, the CPWL should be addressed to them. If the Company Secretary is not based there, it should be addressed to the relevant person at the highest possible level, that is, Director Level or overall Site Manager Level. A copy should also be sent to the Company Secretary at the company’s principal place of business.

Remember if this is a national company, HMRC may have allocated it a Customer Relationship Manager (CRM) and you must obtain the CRM’s agreement before issuing any warning letter.