Breaches of conditions of approval
Customs Controls on Importation of Goods Regulations 1991 SI 1991/2724 Regulations, (regulation 8) provides the power to take legal action against a temporary storage operator where they have breached a condition of their approval. It states:
In the event of any contravention of failure to comply with
- any provision of the Council Regulation (or any provision of the Commission Regulation) as specified in Schedule 4 or
- any requirement or condition imposed by or under any such provision or
- any undertaking given pursuant to any such provision or requirement or
- regulations 3, 4 or 5
- the person responsible for the contravention or failure shall be liable on summary conviction to a penalty of level 3 on the standard scale and any goods in respect of which the offence was committed shall be liable to forfeiture.
- The temporary storage operator will in certain circumstances be held personally liable for breaches of their conditions of approval
- EU Regulation 952/2013 Art 79
1. a customs debt on importation shall be incurred through
- non fulfilment of one of the obligations arising, in respect of goods liable to import duties, from their temporary storage or from the use of the customs procedure under which they are placed or
- non compliance with a condition governing the placing of the goods under that procedure or the granting of a reduced or zero rate of import duty by virtue of the end use of the goods, in cases other than those referred to in Article 79 unless it is established that those failures have no significant effect on the correct operation of the temporary storage or customs procedure in question
2. the customs debt shall be incurred either at the moment when the obligation whose non fulfilment gives rise to the customs debt ceases to be met or at the moment when the goods are placed under the customs procedure concerned where it is established subsequently that a condition governing the placing of the goods under the said procedure or the granting of a reduced or zero rate of import duty by virtue of the end use of the goods was not in fact fulfilled
3. the debtor shall be the person who is required, according to the circumstances, either to fulfil the obligations arising, in respect of goods liable to import duties, from their temporary storage or from the use of the customs procedure under which they have been placed, or to comply with the conditions governing the placing of the goods under that procedure
Action to take when a breach has been established
When you have established that a breach of the temporary storage approval has taken place you should immediately bring it to the attention of the operator. Consider all the factors before taking any action. When deciding the most appropriate action to take in order to improve compliance, certain factors need to be taken in consideration. Before deciding whether or not to take offence action consider the following:
- did the operator voluntarily disclose the breach to Customs?
- does the trader have a good compliance history? If so, would technical advice/training for the operator be the most appropriate action for dealing with the breach
- are there any other relevant factors that need to be considered?
- would the issue of a Customs Civil Penalty (CCP) Warning Letter be the most appropriate action to improve compliance?
- is suspension/revocation of the approval appropriate?
- would implementing additional terms and conditions by using Annex F of the approval improve compliance?
Serious or repeated breaches of approval terms and conditions and/or operating or attempting to operate, or deliberate, non compliant activity will also render the Operator to Customs Civil Penalty (CCP) action which may also include suspension and/or revocation of their approval.
If it is a serious breach for example smuggling and importation of restricted and prohibited goods then careful consideration should be given to withdrawing the approval as soon as possible. You should ask for the name of a senior manager in the company so that you can copy details of the case to that person for their information. You should consider what the appropriate remedial action is in the circumstances.
This should include an offer to the operator of training/technical advice and/or a review concerning their use and understanding of temporary storage arrangements.
All visiting officer for example both HMRC and BF officers are required to send the NFAU copies of all their visit reports.
Specimen advice letter: breach of conditions
Notification of breach of temporary storage approval conditions
It has been brought to my attention that (operator’s name) failed to comply with the conditions of their approval dated
The breach(es) of conditions that have been reported to me is/are as follows:
(list the incident(s) and the condition(s) of approval that have been breached)
In order for (operator’s name) to be allowed to continue to operate a temporary storage facility, the conditions set out in the letter of approval dated ………………………………must be fully complied with.
Any future breach of conditions of approval may result in:
- Civil Penalty action being considered
- Revocation of approval
Use of 1 and 2 above
(*The breach(es) referred to above demonstrate(s) a lack of awareness and/or understanding of certain aspects of temporary storage. It is advisable that a meeting should be arranged with (operator’s name to discuss how to ensure that the same or similar breaches do not occur again.
Please contact me as a matter of urgency to agree a time when we can meet and discuss your operation of temporary storage arrangements).
Please sign, date and return the copy of this letter (attached) as acknowledgement that (operator’s name) is aware of its content and their obligations as a Customs approved temporary storage operator.
- Insert as required.