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HMRC internal manual

Customs Freight Simplified Procedures

Rejection of a new application or suspension/revocation of an authorisation: rejection of a new application

If the officer has any reason to doubt the trader’s suitability for authorisation as a result of the checks, visits or testing undertaken during the pre-authorisation process, the officer should identify the specific areas of concern, systems weakness or past non-compliance further to establish whether:

  • it was the result of recklessness or negligence
  • it was a deliberate attempt to avoid the payment of revenue
  • it was a deliberate attempt to evade their responsibilities
  • it is a systems weakness (data systems, duty management system)
  • it is a weakness within the trader’s operating procedures (poorly trained staff, lack of internal communication between departments, poor management controls, lack of documented procedures)
  • the audit trail is incomplete/poor
  • there is a risk to data integrity.

If there is sufficient reason to believe that the trader is knowingly non-compliant then the officer should discuss with line management the risks involved with their authorisation for CFSP.

If there are particular systems or operating weaknesses then the authorising officer should discuss additional controls with the trader that will minimise these risks. If these types of risks can be minimised through the implementation of additional controls such as individual or periodic prior notifications of removal or restrictions in their operation of CFSP eg to SDP only, then the authorisation may be progressed.

If there is reason to believe that the trader will pose a significant risk to the revenue/society then line management may recommend that the application be rejected. Additionally, traders failing to meet the necessary criteria and conditions (outlined in CFSP13250) will, in the majority of cases, be refused authorisation.

If a DR is being used by the CFSP applicant, their functions and contracted responsibilities should be taken into account when processing the application. If the DRs internal controls enable the CFSP applicant to fulfil all of the required criteria and conditions then the authorisation may be granted. See CFSP18250.

The representative’s responsibilities should be documented in the authorisation letter (see Section 2 part 15 of the C&E58). The inclusion of the DR’s details in the authorisation does not transfer any liability/legal responsibilities from the CFSP applicant. The authorised CFSP trader maintains full liability for any customs debt/non-compliance. (See CFSP11200 and CFSP14500 for more details.)