Customs Compliance & Risk Management

Customs Compliance & Risk Management
2022
April/May
Journal for practitioners in Europe
Issue 14
ISSN 2669-2171
April / May 2022
Ilona Mishchenko

Editor's message

Ilona Mishchenko

Member of the Editorial Board

Dear Reader,

For the past three months, Europe, and the rest of the world, have been living under the conditions of Russia’s unjustified and unprovoked aggression in Ukraine. The war has created new sanctions and challenges concerning international trade, as well as customs and logistics that must be taken into account by exporters, distributors, and other stakeholders. In this regard, I would like to draw to your attention recent legislative changes in Ukraine, dictated by martial law and the extremely difficult conditions for foreign trade, prepared by Iryna Pavlenko and Oleg Kyryievskyi, as well as the article ‘Sanctioned persons: get to know your customers and suppliers’ by Andrius Košel, and the article ‘Kaliningrad - Russia transit: are there any special simplifications?’ by Jurgita Stanienė.

The origin of goods is one of the most frequent topics in the CCRM Journal. In the current issue, Peter Mitchell and Enrika Naujokė analyse the process of post-clearance verification of preferential origin set out in some of the free trade agreements of Canada, the UK, and the EU. Practical examples and suggestions on how the preferential origin-related risk could be managed by importers are provided.  

In the article ‘Keep an eye on customs case law or Who has enough money to throw away?’ Dr Talke Ovie advises on how not to lose money, i.e. ask for payment of interest in the case of reimbursement of customs duties collected unlawfully. In this regard, Gediminas Valantiejus analyses the case law of the Court of Justice of the EU and summaries conditions under which persons are entitled to receive compensation in the form of interest. 

The case law section is also represented by Ingrida Kemežienė, who overviews ‘The case with the smell of vanilla’, which deals with the classification of vanilla extracts containing ethanol and their exemption from excise duty on alcohol. Continuing the classification topic, Dr David Savage describes the challenges of appealing classification rulings in the article ‘The “dark art” of classification (challenging a BTI ruling)’. Prof Krzysztof Lasiński-Sulecki draws attention to the fact that the validity of a BTI can be affected by the soft law in the article ‘A few remarks on the softness of soft law in the sphere of customs classification’.

The complexity and diversity of activities that fall under customs control involve many employees and departments of a company. Who should ensure compliance with numerous requirements and regulations? You will find some suggestions in an article ‘Who is responsible for customs compliance? or When everyone is responsible - no one is!’ by Enrika Naujokė. A further point to consider concerning the topic of compliance is made by Samuel Draginich, who highlights in his article on the US CBP’s current developments that customs compliance practitioners are pivotal in strategic business planning. Regarding the topic of planning, Monika Bielskienė invites readers to consider the future of the EU customs through a review of the Wise Persons Group’s proposals for customs reforms.

In addition, in the current CCRM issue, you can find other interesting and valuable information, particularly on the non-transparent licensing of imports in various countries, the issues that go with a low customs value of goods, and the opportunities that implementation of Port Community Systems brings, and more.

Please enjoy reading and leave your comments, suggestions, or questions to an article online or email them to info@lcpa.lt. 

Dr Ilona Mishchenko
Member of the Editorial Board
Odesa, Ukraine, 31 May 2022

Read more

Knowledge

Journals on Customs: Why should you attend the Global Webinar?

Journals on Customs: Why should you attend the Global Webinar?

Boryana Peycheva
Boryana Peycheva
15 May 2022

On April 28th, 2022, another edition of the event 'Global Webinar: Journals on Customs' took place, during which editors of six leading journals shared their insights concerning some of the most significant topics, events and articles that have taken place in specialist editions over the past year. For me, as...

compliance
Knowledge

Case law

Keep an eye on customs case law or Who has enough money to throw away?

Keep an eye on customs case law or Who has enough money to throw away?

Talke Ovie
Talke Ovie
03 Apr 2022

‘Compliance’ with statute law has given rise to a lot of publications and debates. However, when considering compliance, it should not be forgotten that case law also influences a company’s organisation and processes. Can you think of any court cases which are having an effect on your internal operations? Using...

taxes and tariffs
compliance
Case law
The case with the smell of vanilla

The case with the smell of vanilla

Ingrida Kemežienė
Ingrida Kemežienė
24 Apr 2022

The Court of Justice of the European Union (CJEU) examined a case, the goal of which was to clarify the tariff position that covers a runny and golden-brown product with a strong smell of vanilla, consisting of approximately 85% ethanol, 10% water, 4.8% dry residue and having an average vanilla...

classification
Case law
Payment of interest on returned sums that were unlawfully recovered by the customs authorities in the EU Member States and their assessment by the EU courts

Payment of interest on returned sums that were unlawfully recovered by the customs authorities in the EU Member States and their assessment by the EU courts

Gediminas Valantiejus
Gediminas Valantiejus
31 May 2022

In business practice, the customs authorities often recover from the traders (business entities) (or sometimes – refuse to pay to these persons) various duties, charges, levies, or sanctions administered by them, even though such recovery or refusing to pay them at the later date may be declared illegal, contrary to...

taxes and tariffs
compliance
Case law

Overviews and comments

Kaliningrad – Russia transit: are there any special simplifications?

Kaliningrad – Russia transit: are there any special simplifications?

Jurgita Stanienė
Jurgita Stanienė
10 Apr 2022

Due to the war in Ukraine, the Kaliningrad Oblast is getting increased attention. We receive questions about the ‘Kaliningrad transit‘: whether there are any simplifications for the transportation of goods from Russia to Kaliningrad and vice versa or exemptions from sanctions? The exemptions have been introduced in the fifth EU...

clearance process
restrictions
Overviews and comments
Non-tariff measures
Post-clearance verification of preferential origin of goods

Post-clearance verification of preferential origin of goods

Peter Mitchell
Peter Mitchell
17 Apr 2022

Customs may carry out post-clearance verification of the preferential origin of goods. As a result, a letter from customs might appear on the importer's desk stating that the preferential tariff treatment has been denied. In this article, we look at what is the process of post-clearance verification of preferential origin...

origin
Overviews and comments
Origin
Who is responsible for customs compliance? or When everyone is responsible - no one is!

Who is responsible for customs compliance? or When everyone is responsible - no one is!

Enrika Naujokė
Enrika Naujokė
24 Apr 2022

Reader‘s question: We are a medium-sized EU manufacturing company. We import and export goods, and customs clearance is handled by customs agents. We are going to set up our own customs warehouse, apply for the AEO status and obtain authorisations for customs simplifications. We have also faced restrictions in regard...

compliance
Overviews and comments
Wise Persons Group recommendations: what is the future of EU customs?

Wise Persons Group recommendations: what is the future of EU customs?

Monika Bielskienė
Monika Bielskienė
28 Apr 2022

In order to stimulate 'thinking outside the box' in the EU debate on the future of the Customs Union, the European Commission has established a Wise Persons Group on Challenges Facing the Customs Union (WPG) to reflect on four key topics: e-commerce, risk management, the effective management of non-financial tasks...

clearance process
law
compliance
Overviews and comments
Sanctioned persons: get to know your customers and suppliers

Sanctioned persons: get to know your customers and suppliers

Andrius Košel
Andrius Košel
30 Apr 2022

As you know, the European Union has adopted several packages of restrictive measures against the Russian Federation in the wake of the Russian war of aggression against Ukraine and restrictive measures against the Republic of Belarus in the light of the situation in Belarus. All these measures must be effectively...

restrictions
Overviews and comments
Non-tariff measures
Low value - is it the market price, a result of good business negotiation skills, or fraud?

Low value - is it the market price, a result of good business negotiation skills, or fraud?

Milda Stravinskė
Milda Stravinskė
02 May 2022

The problem of declaring a low value of goods and undervaluation to customs has always been relevant, and the control of determining the correct customs value has never left the sight of customs. We provide an overview of topics and cases of the European Court of Justice explored during an...

valuation
Overviews and comments
Valuation
Port Community Systems & Customs (Part I)

Port Community Systems & Customs (Part I)

Uwe Liebschner
04 May 2022

Customs put the pieces of the various authorities' puzzle together and release the goods with an overall decision. Therefore, among many other players, the customs administration plays an extremely important role in effective operations in the port, and close cooperation among all the stakeholders is an obvious guarantor of quality....

Tech
Overviews and comments
Port Community Systems & Customs (Part II)

Port Community Systems & Customs (Part II)

Uwe Liebschner
04 May 2022

The aim of Port Community Systems (PCS) or trade Single Windows (SW) activities is not to replace existing systems. Rather, it is to create a sufficient landscape of electronic infrastructure and exchange mechanisms to link the administrative processes with the operation of all stakeholders involved. Collaboration/ cooperation is the key...

Tech
Overviews and comments

EU law

EU law news: April/May 2022

EU law news: April/May 2022

29 May 2022

News in week 21: an updated version of the guidance document on the Registered Exporter (REX) system; regulations concerning anti-dumping and/or countervailing duties on imports of certain iron or steel fasteners originating in China, woven and/or stitched glass fibre fabrics originating in China and Egypt, and electrolytic chromium coated steel...

law
EU law

Non-tariff measures

What exporters should know about licensing barriers?

What exporters should know about licensing barriers?

Ilona Mishchenko
Ilona Mishchenko
03 Apr 2022

Due to the non-transparent import licensing requirements in many countries, such as Turkey, India, Malaysia, Brazil, and Argentina, to mention a few, exporters are denied trade opportunities, which these days are especially important for those who lost their export markets after Russia invaded Ukraine. The article introduces basic information on...

law
restrictions
other
Non-tariff measures
What strategies may EU traders use to overcome trade barriers?

What strategies may EU traders use to overcome trade barriers?

Ilona Mishchenko
Ilona Mishchenko
31 May 2022

Recently, the European Commission (EC) terminated the examination procedure concerning obstacles to trade applied by Mexico (see Commission implementing decision (EU) 2022/161, 3.2.2022). This was because the dispute regarding Tequila export licenses was resolved in favour of EU exports by domestic courts in Mexico. The example reveals that exporters can...

law
restrictions
other
Non-tariff measures

Country update

Keeping abreast of U.S. CBP’s current strategies and developments

Keeping abreast of U.S. CBP’s current strategies and developments

Samuel Draginich
Samuel Draginich
29 May 2022

Every year U.S. Customs and Border Protection (‘CBP’) releases the ‘CBP Trade and Travel Report’. Trade compliance practitioners should take note of these annual reports to keep abreast of CBP’s current strategies and developments. Additionally, the information contained can provide insight into CBP’s strategic outlook for the future, a valuable...

law
Country update
Ukraine customs-related news: April/May 2022

Ukraine customs-related news: April/May 2022

Iryna Pavlenko
Iryna Pavlenko
31 May 2022

News at a glance: the ban on the export of Ukrainian agricultural products during martial law; the limitation of foreign currency transactions for import operations; USA: temporary suspension of tariffs on Ukrainian steel; UK: agreement on “cutting” tariffs on all goods from Ukraine to zero; EU: 'Solidarity Lanes' for Ukrainian...

law
Country update

Classification

The "dark art" of classification (challenging a BTI ruling)

The "dark art" of classification (challenging a BTI ruling)

David Savage
David Savage
15 May 2022

The area of classification is often seen as a dark art and impenetrable to most people. This is of course untrue, but it does require experience and repeated and frequent exposure in order to operate confidently and competently within this discipline. In March 2021, an article reporting on the deliberations...

classification
Classification
A few remarks on the softness of soft law in the sphere of customs classification

A few remarks on the softness of soft law in the sphere of customs classification

Krzysztof Lasiński-Sulecki
Krzysztof Lasiński-Sulecki
31 May 2022

Customs classification rules are numerous, long and technically complex. No wonder both declarants and customs authorities seek guidance as to understanding these rules. This article outlines the intricacies of hard and soft law aimed at facilitating the application of the classification provisions.

classification
law
Classification