Processing the application: Direct Representatives and traders' records
When a DR is employed to maintain certain supporting documentation or records for the authorised trader, these records/ documents must be made available via electronic means or at the authorised trader’s premises on request to allow Customs to undertake any necessary post-clearance checks or audits. The timescales for the presentation of these documents must be noted in the written request to the authorised trader.
Additional conditions when an authorised party is using a DR
In all instances where an authorised CFSP trader is using a DR the officer must ensure that the following conditions are met. They should stress to the trader that no legal liability is transferred from them to the DR. It always remains the authorised trader’s responsibility to:
- provide the DR with information relating to all imports covered by the Simplified Procedures within each period and to ensure the accuracy and completeness of all source documents and other data
- ensure that any data processed on their behalf by the DR is accurate and complete
ensure that the DR:
- submits to Customs valid declarations within the time limits specified in the authorisation
- archives, retains and makes available sufficient information to allow retrospective checks to be undertaken by Customs
- archives all declarations for 4 years from the date of their submission/transmission (other legislation eg VAT, Excise or Company taxation may specify that this information must be kept for longer periods)
- ensures the responsible declarant on the SFD and SD is the authorised legal entity
- completes box 14 with their own EORI number
- keeps a full and complete audit trail
- keeps the records in a specific place (state where)
- presents the records to Customs at a specific place when requested by Customs (state where)
- has sufficient notice to present records to Customs and
- surrenders the required documents eg GSP certs to Customs at a specific place and within a set period of time (state where and the required time to present).
The visiting officer should note within the visiting officer’s report the agreed arrangements by which these responsibilities will be met (ie what activity will be performed by the CFSP trader and what activity will be performed by their representative).
The officer must ensure that the CFSP trader is made fully aware of their responsibilities and liabilities.
It is important to verify all these points prior to authorising the trader to ensure that no records/ documentation will fall through the cracks (ie either party assuming that the other is maintaining the information) and that the officer can obtain full access to all records within reasonable timescales. The officer should record the results of the above enquiries in their report.
Note: Where a DR is employed, the responsibility for customs debts arising from any irregularities or breaches of the CFSP authorisation remains with the CFSP authorised trader.
Liability for the CFSP authorisation, security and customs debt
The authorised CFSP trader retains responsibility for meeting any criteria and conditions of authorisation and liability for any customs debts arising from their use of CFSP. However, the representative is not absolved from any criminal liability eg CEMA79 Sect 167 offences (incorrect declarations), but civil penalties are far more likely. In matters of criminal liability it is a question of who does what rather than who was authorised to do anything. The CFSP trader is solely responsible for providing the Guarantee for duty required to operate CFSP, as detailed in CFSP12000. This may not be provided by the DR. The trader also retains full responsibility for any irregularities or demands for duty.
Any failure to comply with the conditions of their authorisation regarding the maintenance of these records will result in action being taken against the perpetrator(s) but civil liability for any customs debt that may arise will lie with the authorised trader.
Using a DR for completion/presentation of SFDs and SDs
SFDs may be completed and submitted on behalf of an authorised CFSP trader by an agent acting as a DR. The CFSP authorised trader can contract this to their agent without gaining customs approval to do so, however the authorised trader must provide the DR with accurate information and hold evidence of the checks that they perform to ensure the accuracy of the submitted frontier declarations.
SDs can also be submitted by an agent/warehouse-keeper acting as a DR, however the CFSP authorised trader must gain prior approval from their authorising officer before using this facility. In either case, they must ensure that they provide the DR with accurate information as the authorised trader will be held legally liable for all declarations made in their name by the DR.
If a DR is completing the declarations, the officer will need to agree and document with the authorised trader:
- what information they will provide to their agent to allow them to make the correct entry
- how they will cross reference the agent’s SFDs to the SDs (this may be a problem if one DR enters the SFD and another enters the SD). The CFSP trader’s DUCR must appear in box 44 on both the SFD and SDI
- where the records will be archived eg who (trader or DR or split) is going to keep them and where
- what information the agent will provide to the trader to prove acceptance of entries eg will they send them a copy of the Customs Response (CUSRES)
- what management checks the trader will perform to ensure completeness and timeliness of declarations
- what action the agent will take if errors/ problems occur with the entry
- how Customs will access a copy of the entries held in the DRs CFSP system eg if the agent is archiving these, will the agent make them available on demand at their premises for audit
- timescales for accessing entries on the DR’s system
- how long the agent will archive the entries for eg the agent will need to archive them for 4 years after the entry date of the entry (other legislation eg VAT, Excise or Company taxation may specify that this information must be kept for longer periods) and
- how the information file is archived: eg original customs documents, information only (electronic), or will they simply print off and keep everything on paper copies.
The officer will also need to gain assurance of data integrity ie that the data cannot be amended/altered once the CUSRES has been received, eg automatic down-load cannot be amended or deleted. This will enable the officer to validate the declarations on the trader’s system against the information held on MSS.
The above information should be documented by the trader and verified by the visiting officer. The officer should also document the answers to each of these points within the visiting officer’s report.