New criteria for customs representatives

From July 1st Dutch Customs will apply the AEO criteria for customs representatives. For these businesses this really is a step forward.

The Union Customs Code allows Member States to impose certain national conditions on customs representatives. In close consultation with the industry, Customs NL has decided to apply the AEO criteria for this particular group of businesses. Mieke van Schijndel, policy advisor Customs: “The conditions are clear, and identical for all. This really is a step forward.”

Over the past year, Dutch Customs worked out the AEO criteria to apply specifically to customs representatives. It did so in close collaboration with FENEX, the trade association for freight forwarders and logistics service providers. After this, the criteria were aligned with the Customs-Business Consultation forum (ODB). Customs representatives must meet the conditions from 1 July this year. “The standards are still open, but we made them more specific for this particular group of businesses”, Van Schijndel explains. “Because the members of FENEX were involved, it is really a joint product that benefits both Customs and the market. Any points that were not clear enough have been more clearly defined. So now companies are more aware of the conditions they must meet when Customs assesses or reassesses them. The standards have not actually become stricter.”

Quality improvement
Both direct and indirect representatives for import and export must have a customs representative authorisation and must comply with the AEO criteria. A small portion of the declarations is submitted under a person’s own name and for their own account. In the latter case, a customs representative authorisation is not required. “Customs representatives are an important party”, states Van Schijndel. “Given the fact that over 80% of import declarations are submitted by them, there are going to be significant improvements, quality wise.” It is also expected to have an effect on the market: “The conditions are clear, and identical for all companies. That means there is a level playing field. Bunglers will disappear.”
Many customs representatives already have an AEO certificate. Van Schijndel stresses that this does not automatically mean that they meet the rules and no longer have to take action. “They need to look closely at their procedures: are they in line with the criteria?”

Theory and practice
The AEO criteria concern the administrative organisation and internal management, the solvency, the compliance and the practical skills of the representative. During the (re)assessment, Customs will not just check whether a company meets the criteria in theory, but also whether they do so in daily practice. Van Schijndel: “If, for example, they get a new customer, do they actually check that the company exists? And if there is a request for a declaration, does the representative make sure that he has sufficient information? Sometimes a single shipment with combined goods only has a single commodity code, even though it contains different goods with different commodity codes. It could also be that the representative has the impression that the customs value is too low. In both cases there is reason to obtain more specific information from the importer or the client.”

The idea is that representatives do not submit a declaration if they have insufficient information. This may mean that they have to change their procedures, perhaps dramatically so. Van Schijndel: “It is important that they are aware of this and that they start with any modifications in a timely manner.”

Reassessment
Companies that already have a customs agent authorisation have received a letter from Customs with an explanation. Reassessment must take place before 1 May 2019. After a positive reassessment, the customs agent authorisation will be replaced by a customs representative authorisation. “We are going to reassess these companies starting on 1 July 2017. So they have until then to make sure that they meet the criteria.”

Companies that do not have a customs agent authorisation certificate and want to keep acting as a customs representative have also received a letter. This letter states that they can apply for an authorisation if they meet the detailed AEO criteria. Customs will evaluate this and decide whether the company is eligible for a customs representative authorisation certificate.
Van Schijndel recommends that companies seriously consider whether an authorisation certificate is worth it. “If you hardly ever submit declarations as a representative, it may be the time to decide to not apply for an authorisation certificate or to withdraw your authorisation. You can chose to submit declarations in your own name and for your own account from now on.”

In the second half of this year, Dutch Customs will modify its declaration system AGS in such a way that direct and indirect representatives can only submit declarations if they have a customs agent or customs representative authorisation certificate. The Customs-Business Consultation forum will discuss when exactly this will happen.

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