Uniformity, technology are highlighted in new regulations

By Peter A. Buxbaum, AJOT

As 2005 was coming to an end, the European Commission adopted two proposals to modernize the European Union Customs Code and to introduce an electronic, paper-free customs environment in the EU. The first proposal aims to simplify and streamline customs processes and procedures. The second proposal is designed to make member states’ electronic customs systems compatible with each other; introduce EU-wide electronic risk analysis and improve information exchange between frontier control authorities; make electronic declarations the rule; and introduce a centralized customs clearance arrangement. The result, according to the EU, will be to increase the competitiveness of companies doing business in Europe, reduce customs compliance costs, and improve security.

The first proposal, for a regulation to modernize the Customs Code, would simplify legislation and administration procedures for both customs authorities and traders. It would simplify customs rules and provide a uniform terminology; reduce the number of import and export procedures and make it easier to keep track of goods; rationalize the customs guarantee system; and extend the use of single authorizations, in which procedures authorized by one member state would be valid throughout the EU.

The second proposal, for promoting electronic customs, would make electronic declarations compulsory. It would also make the electronic customs systems of member states compatible with each other and would create a single shared customs computer portal. The purpose of the measure is to facilitate communications between traders and customs and allow for faster and better exchange of information among European customs authorities.

The second proposal would also set up the equivalent of a known shipper program called a ‘Single Window,’ through which authorized importers would deal with one, instead of several, frontier control authorities. Information relating to any given shipment would only have to be sent once. The goods would then be controlled by customs and other relevant authorities, such as police, border guards, and veterinary and environmental authorities through the single electronic connection.

Level playing field

The European Commission considers the Customs Union as one of the pillars of the united Europe, according to commission documents. ‘The Commission considers that, if customs legislation were simplified, customs processes and procedures streamlined, and IT systems converged, traders would save money and time in their business transactions with customs,’ a commission document noted. ‘In addition to improving safety and security checks, this would contribute to the competitiveness of European business.’

These two proposals are the latest in a string of European measures designed to simplify customs and make European business more competitive. Earlier in 2005, the European Parliament approved a regulation to improve the security and safety of goods crossing European Union borders. That regulation provided for the electronic exchange of information between customs offices on movements of goods; required traders to provide electronic summary declarations to customs authorities with information on goods prior to their import into or export from the European Union; and introduced an EU-wide computerized system for risk management.

The regulation also introduced electronic information exchange between customs administrations and introduced EU-wide risk selection criteria supported by a coordinated computerized system. This aspect of the regulation is designed to reduce the differential in resources devoted by the various EU member states towards preventing dangerous or defective goods from entering the European Union. According to the European Commission, this will allow a better response at the EU level to new cargo security threats.

The tightening of security rules also addressed international concerns over cargo security. T