Opinion of the European Economic and Social Committee on ‘Proposal for a Regulation of the European Parliament and of the Council establishing, as part of the Integrated Border Management Fund, the instrument for financial support for customs control equipment’

(COM(2018) 474 final — 2018/0258 (COD))

(2019/C 62/11)

Rapporteur: Antonello PEZZINI

Referral European Parliament, 2.7.2018 Council, 4.7.2018 Legal basis Articles 114(1) and 304 of the Treaty on the Functioning of the European Union Section responsible Single Market, Production and Consumption Adopted in section 2.10.2018 Adopted at plenary 17.10.2018 Plenary session No 538 Outcome of vote (for/against/abstentions) 200/0/5

1. Conclusions and recommendations

1.1. The European Economic and Social Committee (EESC) considers it essential, in the light of growing problems linked to the control of the EU’s external borders, to implement a system that couples the protection of individuals and border security with the creation of profitable trading links with third countries.

1.2. This is one of the major challenges that the European Union must address and the EESC believes that the Border Management Package, which has been prepared for the next Multiannual Financial Framework, is a positive first step.

1.3. With a view to safeguarding Member States’ social culture and social, environmental, economic and financial interests, the EESC considers it vital to ensure that the EU has high levels of quality and innovation in relation to customs control equipment, used for the following: — the fight against illegal trade (which is still ineffective); — streamlining and simplifying legal trade practices; — safeguarding the security of the EU’s internal market; — protecting the environment and health of citizens; — compliance with fundamental labour rights; — protecting consumer interests; — providing optimal customs risk management; — collecting duties.

1.4. The Committee also considers the following important, in relation to the new instrument: — ensuring that priority is given to equipment for borders that are under the greatest pressure in terms of controls, such as sea borders; — speeding up the work of evaluation teams operating in this field (1); — guaranteeing a fair geographical distribution; — respecting the principle of proportionality, linked to the movement of goods and persons, in synergy with the Security Fund.

1.5. The Committee welcomes the Commission’s efforts to improve EU border controls and to boost the required funds and instruments, with the aim of ensuring innovative, high-quality customs controls and, ideally, the uniform application of customs legislation implemented in the external border offices ( 2 )

1.6. The Committee believes that the amount of funding allocated is insufficient considering the aims to be pursued and should, moreover, include equipment for monitoring phytosanitary safety and instruments for carrying out advanced spectrography on goods containers ( 3 )

1.7. The Committee also considers it important to provide equipment with the commensurate speed to those customs offices under greatest pressure to carry out controls, such as sea border offices, which should be given priority when allocating grants. The new instrument should also establish a rapid response reserve for the deployment of new and innovative equipment, while including the possibility of reviewing the list of equipment that has already been approved.

1.8. The Committee calls for maximum transparency to be ensured as regards the annual work programmes and the grants allocation mechanisms ( 4 ) , managed directly by the Commission.

1.9. The EESC recommends close coordination with the Customs programme — aimed at financing a complete range of infrastructure and IT systems, including the digitalisation of interactions between commercial operators and customs services — with Horizon Europe, and with other relevant funds.

1.10. The Committee calls for a medium-term report to be submitted on the new instrument’s achievements and operations, offering an analysis based on qualitative and quantitative indicators.

1.11. Developing a basic common language covering the recurring themes used by customs officials (as is the case with air traffic controllers), within an appropriate time-scale, would make it easier to establish the much anticipated single, uniform European customs system.

1.11.1. The EESC recommends promptly updating the ‘toolbox’ of customs equipment, so as to take immediate account of the development of the internet of Things, cybersecurity, digital tracking and state-of-the-art technological applications, with a view to ensuring their use, by speeding up their deployment and the provision of up-to-date training.

1.11.2. Similarly, common training frameworks ( 5 ) should be developed based on the European Union Customs Competency Framework (EU Customs CFW), which aims to harmonise and raise customs performance standards throughout the EU.

1.11.3. In the meantime it is important to establish common standards and protocols to accompany subsidised materials and equipment intended for customs use, potentially by issuing mandates to European standardisation bodies.

2. Introduction

2.1. The Commission proposes tripling the EU Border Management Fund for the 2021-2027 budget; these funds will be allocated to strengthening the borders, improving the movement of goods, services and persons, including migrants. Under the Commission’s proposal, the financial envelope should increase from the present amount of EUR 13 billion to EUR 34,9 billion.

2.2. The Commission intends to create a new and separate fund for integrated border management. The European Border and Coast Guard Agency (Frontex) will also be given a boost, with a new permanent force of around 10 000 guards and additional funding to improve customs controls and upgrade control equipment. A new Integrated Border Management Fund (IBMF) will be created, worth more than EUR 9,3 billion.

2.2.1. These investments will: strengthen Frontex; carry out systematic border controls; establish new large-scale, interoperable IT systems; and launch a future system to regulate entry and exit at the borders.

2.3. The new IBMF will comprise two different instruments: the first is for ‘integrated border management and visas’ (BMVI); the second is a financial allocation of EUR 1,3 billion for the period 2021-2027 for ‘customs control equipment’ (CCE), which should help in setting up appropriate and equivalent customs controls in the different border offices.

2.3.1. This fund is intended for the purchase of equipment, with the aim of ensuring modern and reliable controls, and for the maintenance and updating of this equipment.

2.4. In the 50 years since its entry into force, on 1 July 1968, the customs union has proven to be an essential pillar of the Single Market, protecting EU borders and citizens from prohibited and dangerous goods, such as arms and narcotics, and from counterfeit goods, while also encouraging steady growth in the share of world trade: in 2017 EU customs handled 16 % of world trade.

2.5. To ensure the smooth functioning of the Customs Union, EU Member States must rely on a common set of rules, based on the Union Customs Code. This code was adopted in 2013 and came into force for all EU Member States in 2016. Since 2016, it has provided the new legal framework for managing the import, export, movement and storage of goods moving within the customs territory and in exchanges with third countries.

2.5.1. Moreover, customs apply more than 60 laws that are not directly customs-related, including those concerned with: — dual use (civil and military) goods; — firearms; — drug precursors; — currency movements in cash; — intellectual property rights; — public health; — product safety; — consumer protection; — the protection of wild species; — environmental protection.

2.6. The EESC has always considered ‘an efficient customs union to be a vital prerequisite for European integration in order to ensure uniform and EU-wide, safe and transparent free movement of goods with maximum consumer and environmental protection and effective combating of fraud and counterfeiting’ ( 6 )

2.7. The Committee also pointed out the importance of the need to introduce ‘modernisation measures such as simpler customs legislation and to complete interoperable computerised customs systems, which will streamline commercial practices and ensure greater coordination of prevention and prosecution activities’ ( 7 )

2.8. As early as 2012, the European Council mentioned ( 8 ) the need to improve internal governance of the customs union and the appropriateness of cooperating with other agencies and the private sector with a view to providing the best service to operators. In its conclusions of June 2014, the Council recommended improving performance appraisals, specifying certain sectors, and called for the establishment of appropriate performance indicators.

2.9. In its conclusions on customs funding of 23 March 2017, the Council invited the Commission to ‘evaluate the possibility of funding technical equipment needs from future Commission financial programmes and improve coordination and (…) cooperation between Customs Authorities and other law enforcement authorities for funding purposes’.

2.10. The European Parliament, in its resolution of 7 April 2017 ( 9 ) , pointed out that ‘the efficiency of customs procedures is crucial not only for trade facilitation, but also for effective and expedient law enforcement with regard to the counterfeiting and smuggling of excisable goods entering the EU’, and that ‘customs services are at the crossroads between secured movement of goods protecting consumers within the EU and the implementation of the provisions of trade agreements’.

3. The Commission’s proposals

3.1. The Commission is proposing, through a regulation, a new financial instrument for customs control equipment as part of an Integrated Border Management Fund (IBMF) is to be established under the ‘Migration and Border Management’ budget heading. The aim is to provide greater support to Member States, to guarantee equivalence in the performance of customs controls throughout the customs union, by correcting the existing imbalances between customs offices in the different Member States.

3.2. The new funding instrument, which will be allocated EUR 1,3 billion during the 2021-2027 period, is intended to cover customs equipment designed for four types of border (land, sea, airport ( 10 ) and post).

3.3. Funding will be available to all Member States and the needs of each type of border will be assessed. The Eastern and South-Eastern Land Border Expert Team (CELBET), which brings together the 11 Member States responsible for EU land borders, has already started work in this sector. Work on other types of borders will begin soon, Member States’ needs to be evaluated and funds allocated as soon the instrument enters into force in 2021 for the 27 Member States ( 11 )

3.4. The objectives set should result in closer coordination, greater legal certainty and improved efficiency or complementarity, through a centralised approach and direct management. Grants covering up to 80 % of eligible costs are to be available to Member States, with a view to supporting the purchase, maintenance and upgrading of customs control equipment, in accordance with pre-defined standards for different types of border.

3.5. The instrument is closely linked to the new Customs programme ( 12 ) . The mechanisms for cooperation included in this programme will be used to assess needs in terms of innovative customs control equipment and, where necessary, joint ( 13 ) training for customs officials, in order to ensure better use of the equipment.

4. General comments

4.1. The EESC is firmly convinced that faced with growing challenges concerning control of the EU’s external borders, it is essential to implement a robust system capable of combining the protection of individuals, the social market economy, the security of sustainable production and trade between Member States and trade with third countries.

4.2. The Committee appreciates the European Commission’s efforts to boost funds and instruments, in order to reinforce external border controls and ensure innovative, high-quality customs controls, with a view to strengthening the customs union.

4.3. The Committee finds, however, that the amount of financing allocated to the new instrument is insufficient, i.e. EUR 1,3 billion, amounting to EUR 186 million per year. This is less than one thirtieth of the overall allocation to border and migration duties for the 2021-2027 period, which totals EUR 34,9 billion.

4.4. The Committee also stresses the importance of: — ensuring that priority is given to equipment for borders that are under the greatest pressure in terms of controls, such as sea borders; — speeding up the work of evaluation teams operating in this field (14); — guaranteeing a fair geographical distribution; — respecting the principle of proportionality, linked to the movement of goods and persons, in complementarity with the Security Fund.

4.4.1. The EESC considers it vital to ensure that customs equipment is high-quality and innovative, in order to optimise the protection of the social culture and economic and financial interests of the EU and its Member States, through: — the fight against illegal trade (15) (which is still ineffective); — streamlining and simplifying measures connected with legal trade; — safeguarding the security of the EU’s internal market; — protecting the environment and health of citizens; — compliance with fundamental labour rights; — consumer protection; — risk management; — collecting duties.

4.5. The Committee calls for maximum dissemination of the annual work programmes and planned measures, as well as of the grants allocation mechanisms, managed by the Commission, encouraging the pooled acquisition of equipment, which must be innovative ( 16 )

4.6. The EESC recommends close coordination with the Customs programme — aimed at financing infrastructure and IT systems, including the digitalisation of interactions between commercial operators and customs services — and with the Horizon programme, which is useful for identifying innovative technologies for to be used in customs controls.

5. Specific comments

5.1. Given that each year, over 200 million twenty-foot equivalent units (TEU) ( 17 ) are handled — i.e. over 10 million containers — it is very difficult to carry out timely controls at many sea and road borders. It would therefore be worthwhile carrying out controls along the routes, facilitated by a change in the materials used to build the structure of containers ( 18 ) , which would allow recognition using drones or the Galileo system.

5.2. It would be helpful to update the 1972 Geneva Convention and 1967 ISO standards, which were established before of the far-reaching changes that have occurred in the 21st century, namely the advent of globalisation and the growing — and now worrying — issue of counterfeiting ( 19 )

5.3. EU Customs CFW The ‘toolbox’ should be promptly updated so as to take immediate account of the development of the internet of Things, cybersecurity, digital tracking and state-of-the-art technological applications, in order to speed up their deployment and the provision of up-to-date training on their correct use, using the ( 20 ) . In this regard, the new financial support instrument should provide for the establishment of a rapid response reserve for the deployment of new equipment, while also providing the possibility of reviewing the list of approved equipment.

Brussels, 17 October 2018. The President of the European Economic and Social Committee Luca JAHIER

(1) At present, only 11 Member States with eastern and south-eastern external borders have carried out the necessary inventory of equipment and categories of measures needed, and have set out proposed standards for each category.

(2) There are 2 140 customs offices. See https://ec.europa.eu/info/publications/annual-activity-report-2016-taxation-and-customs-union_en

(3) This is very useful for checking the contents of the innumerable containers.

(4) Grants exempted from the Financial Regulation are awarded to Member States, which become owners of materials: Articles 7, 10(2), 195(f) and 197 of Regulation (EU, Euratom) 2018/1046 of 18.7.2018.

(5) The European Union Customs Competency Framework (EU Customs CFW) aims at harmonising and raising customs performance standards throughout the EU. © Unione europea, 2015. European Union Customs Competency Framework, which shows the components of the competency framework for the EU customs sector and outlines the approach used in defining competencies. It also explains the decisions taken regarding the choice of certain competencies in each section, focusing in particular on the criteria used to compile the list of operational competencies (e.g. reference to the Union Customs Code and their relation to ‘on-the-job’ competencies, forward-looking approach).

(6) See OJ C 229, 31.7.2012, p. 68.

(7) Ibid. footnote 6.

(8) See. OJ C 80, 19.3.2013, p. 11.

(9) See http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+REPORT+A8-2017-0162+0+DOC+XML+V0//EN#title1PE 595.633v02-00 A8-0162/2017

(10) There are approximately 400 civil airports in the EU.

(11) The proposal is for a Union of 27 Member States, in line with the notification by the United Kingdom of its intention to withdraw from the European Union and Euratom.

(12) See COM(2018) 442 final, on which the EESC prepared opinion INT/860, yet to be published in the OJ. See page 45 of this Official Journal.

(13) See extension of the ‘Working visits’ programme.

(14) At present, only 11 Member States with eastern and south-eastern external borders have carried out the necessary inventory of equipment and categories of measures needed, and have set out proposed standards for each category.

(15) 31,4 million items worth EUR 582 million were seized in 2017. 25 % were counterfeit food products, 11 % were toys, 1,8 % were cigarettes (Source: European Commission).

(16) See COM(2018) 178 final, Report from the Commission on the IT strategy for customs.

(17) TEU = Twenty-foot Equivalent Unit. One TEU is equal to a 20-foot container box, i.e. 28 tonnes and 40 metres3.

(18) Many containers now already have structures made of wood and other materials.

(19) See OJ C 345, 13.10.2017, p. 25.

(20) See footnote 6.