HMAG40130 - General principles: powers to make bespoke conditions on approvals
The power to add a bespoke condition to an approval under UK law depends on the type of approval set out below:
WOWGR approvals:
- Warehousekeeper
- Registered owner
- Duty representative
HMDP approvals:
- Registered consignee
- Temporary registered consignee
- Registered commercial importer
- Registered consignor
- Tax representative
The Commissioners may approve and register a person under this section for such periods and subject to such conditions or restrictions as they may think fit or as they may by or under the regulations prescribe.
Section 100G(5) Customs and Excise Management Act, which states:
‘The Commissioners may at any time for reasonable cause revoke or vary the terms of their approval or registration of any person under this section’.
Warehouse premises
For warehouse premises approvals, UK law adds the following bespoke conditions:
Section 92(1) Customs and Excise Management Act (CEMA), which states:
‘The Commissioners may approve, for such periods and subject to such conditions as they think fit, places of security for the deposit, keeping and securing:
(a) of imported goods chargeable as such with excise duty (whether or not also chargeable with customs duty) without payment of the excise duty;
(b) of goods for exportation or for use as stores, being goods not eligible for home use;
(c) of goods manufactured or produced in the United Kingdom or the Isle of Man and permitted by or under the customs and excise Acts to be warehoused without payment of any duty of excise chargeable thereon;
(d) of goods imported into or manufactured or produced in the United Kingdom or the Isle of Man and permitted by or under the customs and excise Acts to be warehoused on drawback, subject to and in accordance with warehousing regulations; and any place of security so approved is referred to in this Act as an ‘excise warehouse’.
Section 92(5) Customs and Excise Management Act (CEMA), which states:
‘The Commissioners may from time to time give directions
(a) as to the goods which may or may not be deposited in any particular warehouse or class of warehouse;
(b) as to the part of any warehouse in which any class or description of goods may be kept or secured.’
Section 92(7) Customs and Excise Management Act (CEMA), which states:
‘The Commissioners may at any time for reasonable cause revoke or vary the terms of their approval of any warehouse under this section.’
Commissioners’ Directions
For Commissioners’ Directions, UK law adds the following bespoke conditions:
Commissioners’ Directions are made under the powers contained in Regulation 17(3) Excise Warehousing (etc.) Regulations 1999 which states:
‘In such cases as the Commissioners may direct the proper officer may impose conditions and restrictions on the removal of goods from an excise warehouse in addition to those imposed elsewhere in these regulations.’
To enable officers to add CD conditions to approvals the following Commissioner’s direction was provided on the 30th October 1997 by David Howard, Commissioner of Customs and Excise:
‘The Commissioners, in pursuance of their powers under Regulation 17(3) of the Excise Warehousing (Etc.) Regulations 1988, DIRECT THAT the proper officer may impose additional conditions and restriction on the removal of any goods from an excise warehouse in the case of any warehouse in which goods that are not owned by the occupier are warehoused. ‘
Alcohol Wholesale Registration Scheme (AWRS)
For AWRS approvals, UK law adds the following bespoke conditions:
ALDA 1979 part 6A Wholesaling controlled alcohol, Section 88c, which states:
‘88c (3) The Commissioners may approve a person under this section to carry on a controlled activity for such periods and subject to such conditions or restrictions as they may think fit or as they may by or under regulations made by them prescribe.
(4) The conditions or restrictions may include conditions or restrictions requiring the controlled activity to be carried out only at or from premises specified or approved by the Commissioners.
(5) The Commissioners may at any time for reasonable cause revoke or vary the terms of an approval under this section’
The power to add a bespoke condition to an approval under EU law for storage and movement of goods is set out below:
Storage of goods
Directive 118/2008 provides the main requirements that Member States must adopt when developing their own rules, the UK is permitted to add conditions to approvals in relation to the production, processing and holding of excise goods, where the excise duty has not been paid.
EU law to add bespoke conditions to storage of goods:
Article 15 states:
‘Each Member State shall determine its rules concerning the production, processing and holding of excise goods, subject to this Directive. The production, processing and holding of excise goods, where the excise duty has not been paid, shall take place in a tax warehouse.’
Article 16 states:
‘The opening and operation of a tax warehouse by an authorised warehousekeeper shall be subject to authorisation by the competent authorities of the Member State where the tax warehouse is situated. Such authorisation shall be subject to the conditions that the authorities are entitled to lay down for the purposes of preventing any possible evasion or abuse.’
An authorised warehousekeeper shall be required to:
(a) provide, if necessary, a guarantee to cover the risk inherent in the production, processing and holding of excise goods
(b) comply with the requirements laid down by the Member State within whose territory the tax warehouse is situated
(c) keep, for each tax warehouse, accounts of stock and movements of excise goods
(d) enter into his tax warehouse and enter in his accounts at the end of their movement all excise goods moving under a duty suspension arrangement, except where Article 17(2) applies
(e) consent to all monitoring and stock checks.
The conditions for the guarantee referred to in point (a) shall be set by the competent authorities of the Member State in which the tax warehouse is authorised.
Movement of goods
It is the intention of EU law to allow the free movement of suspension goods from an approved UK tax warehouse to tax warehouse based in another Member State, and vice versa.
It is a fundamental privilege of a warehousekeeper approval to be able to consign goods to the EU. Conditions can not normally be placed preventing such trade, unless there was strong evidence that the arrangement was causing or was likely to cause a tax loss
EU law to add bespoke conditions to movement of goods:
Recital 17 to Directive 118/2008 states as follows:
‘It should be possible for excise goods, prior to their release for consumption, to move within the Community under suspension of excise duty. Such movement should be allowed from a tax warehouse to various destinations, in particular another tax warehouse but also to places equivalent for the purposes of this Directive.’
Placing restrictions on who a business can trade within the EU may contravene Article 34 of the Treaty on the Functioning of the European Union which prohibits ‘quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.’ Exceptions are permitted on grounds such as ‘public policy’ but where businesses were approved this would be difficult to generally argue.