The recent publication of a number of notices designed to help UK businesses prepare for a no deal exit from the EU has reinvigorated discussion on the practicalities for movements of goods. With 25 notices published and 50+ to come, one item among many still to be addressed concerns temporary importations.
At present, a UK individual or entity can take goods and/or equipment into other member states without the need to declare. Once the UK leaves, this situation is set to change, with customs checks and declarations taking place whenever goods enter or leave the EU’s customs union.
This blog post aims to help readers understand a tool currently used widely across the EU for temporary importation under certain circumstances, the ATA Carnet.
ATA Carnets are widely used by those involved in importing items temporarily. Often referred to as a passport for goods, a carnet allows the holder to avoid payment of duties that would be liable in a permanent import, and avoids the inconvenience of leaving a bond, which is effectively cash tied up for the time the items are ‘visiting’.
At present, around 70 countries worldwide are signatories of the carnet convention, allowing for use of the document by those looking to temporarily import into their borders, without incurring the duties attached. These signatories include EU markets, meaning the infrastructure exists within these countries, although the utilisation for EU/UK purposes may necessitate additional resource in some areas, not least those trained to process the forms.
In the UK, carnets are issued by Chambers of Commerce, with issuing offices throughout the country. The documents are formed by groupings of papers in various colours, helping users identify the sections and their uses. The carnet includes a full list of the items travelling, with identifying features designed to help customs authorities match the goods checked to the document presented. Following a relatively recent switch to A4 and advances in technology, they can be applied for electronically, including through the ezCert site enabling regular users to create templates which can be copied for future use, and easy step by step instructions following templates on screen. This allows for quick turnaround, commonly 24 hours.
Applicants need to be mindful of the fact UK customs (or more commonly UK Border Force) need to have the chance to inspect the goods/items leaving, and to apply ink to parts of the form before or at the time of departure, so co-ordination is required to ensure the system can be used. This is particularly relevant for goods leaving a regional port or airport, where the number of officers with relevant experience may be small. This point is considerable if there’s to be a significant uplift, with regional ports and airports noticeably less proficient than those working in trade hubs such as Heathrow.
There are two costs attached to a carnet, one fixed and one variable. The fixed cost aspect being the issuing fee for the provision of the form. The second, variable aspect, relates to the cost of a non refundable premium, which pays for an underwriter to cover the potential duties involved in the movement. This is dependent upon the value of the goods, their classification (which is determined from a list of 28 categories), and their journey.
While there are at present no notices outlining the intention of using carnets for temporary imports to the EU/UK post Brexit, it could potentially provide a solution for those moving goods between the two areas. This could be useful for example for taking musical instruments for performances in various member states. As there’s only one border being crossed, the carnet could be used for the duration of the trip or perhaps a number of trips from the UK with one set of charges, with the carnet validity period currently set at two, six or twelve month validity.
Although the increased bureaucracy is rarely welcomed by business, the expansion of an existing system would be far easier for the UK to bear than the introduction of another, and the utilisation of technology allowing for electronic submission provides some relief for those impacted.
Keep checking back to this blog for updates, and contact us if you have any queries.