Businesses could be underprepared for new customs service in 2018

Businesses that import and export goods outside of the EU should begin preparing for the new Customer Declarations Service (CDS), HM Revenue & Customs (HMRC) has warned.

In a new report, HMRC has confirmed that it will begin a phased launch of the CDS from August 2018, replacing the existing Customs Handling of Import and Export Freight (CHIEF) system.

From early 2019, all declarations must take place on the new system and businesses will need to ensure they make adequate preparations to complete this transition.

Although plans to replace the current system were implemented before the EU referendum, HMRC has suggested that it could be scaled to adapt to “any potential increases in volume of declarations that may result from the UK’s exit from the EU”.

Businesses will use the CDS to process declaration for goods entering and leaving the UK or EU through ports and airports, as well as calculate and pay the correct duty and taxes. Customs information can be provided through the CDS electronically, therefore streamlining the process for both HMRC and businesses.

Additional information, pertaining to the recently implemented World Customs Organisation Kyoto Convention, will also be required for declarations and businesses must be careful to ensure that all legal requirements are met.

This includes:

  • an audit trail of previous document IDs;
  • additional party types, such as the buyer and seller;
  • possible additional commercial references or tracking numbers; and
  • levelling – change between ‘Header’ and ‘Item’ for some data items.

If you have concerns about exporting or importing products from outside of the UK and how to ensure compliance with relevant legislation, please contact a member of Mackrell Turner Garrett’s commercial law team.

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Maung Aye
Maung is a partner in our Corporate and Commercial department. He joined Mackrell Turner Garrett following corporate law positions in London and in a leading regional firm in Essex. Maung read European Legal Studies at Lancaster University and the Università degli Studi di Trento and is a fluent Italian speaker.