Communication from the Commission to the Council, the European Parliament and the Economic and Social Committee concerning a strategy for the Customs Union
Date: 2001-02-08
Institutions: European Commission
Subjects: action programme, customs cooperation, customs regulations, customs union, enlargement of the Union

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 08.02.2001
COM(2001) 51 final

COMMUNICATION FROM THE COMMISSION
TO THE COUNCIL, THE EUROPEAN PARLIAMENT
AND THE ECONOMIC AND SOCIAL COMMITTEE

concerning a strategy for the Customs Union

COMMUNICATION FROM THE COMMISSION
TO THE COUNCIL, THE EUROPEAN PARLIAMENT
AND THE ECONOMIC AND SOCIAL COMMITTEE

concerning a strategy for the Customs Union

This Communication follows on from the earlier Communication on customs prior to the
introduction of the Single Market1.

It is now appropriate to review the strategy to be adopted for customs' activities in the
Customs Union in order to take account of major changes which are underway or which will
occur in the near future. These include:

–

–

–

–

–

–

–

–

Enlargement of the European Union

Changing revenue collecting role of customs

Increasing demand for customs involvement in external trade regulation

Increasing requirement for customs to ensure the safety of citizens

Growing new trading patterns requiring rapid clearance using electronic means

Increasing demand for customs to support economic operators in the
Community in their efforts to compete fairly in a global market

Increasing emphasis on the fight against fraud

Involvement of organised crime in customs related fraud activities

This Communication provides an in-depth examination of these issues and outlines the
orientations for future actions, based on the shared values of openness, flexibility, efficiency
and co-operation between customs administrations, that could be taken to meet the challenges
faced.

1

Communication from the Commission to the Council, the European Parliament and the Economic and
Social Committee "The Customs Union in the context of the Single Market" (COM(90)572final),
31.1.1991.

2

CONTENTS

INTRODUCTION

A CHANGING ENVIRONMENT

Changing revenue collecting role of customs

Increasing external trade regulation

Growing and changing patterns of international trade

Customs as a factor in the competitiveness of EU businesses

Enlargement of the European Union

Increasing importance for indirect taxes

THE FIGHT AGAINST FRAUD

COMBATING CRIMINAL ACTIVITIES

THE MAJOR CHALLENGES

RESOURCES

STRATEGIC OBJECTIVES

PROPOSALS FOR ACTIONS

Legislation

Operations

Improving the service to business

Training

International role of customs

1.

2.

2.1.

2.2.

2.3.

2.4.

2.5.

2.6.

3.

4.

5.

6.

7.

8.

8.1.

8.2.

8.3.

8.4.

8.5.

9.

CONCLUSIONS

3

1.

INTRODUCTION

At a time when the Commission is committed to implement its policies more effectively and
is stepping up its efforts to combat fraud, customs bear an important part of the responsibility
for the management of the Customs Union, one of the foundations upon which the European
Union is based.

the cutting edge, customs implement Community policies in almost all
Operating at
international trade related fields. Customs legislation shall not only favour international trade
but, when it comes to control, shall be exercised without introducing excessive friction into
the trading system, harmful to both trade and the competitiveness of European businesses.

Customs are now facing the difficult challenge of coping with an increasing range and
number of Community controls in an environment where the volume and speed of
international trade is increasing. At the same time the increasingly global marketplace offers
greater opportunities for fraud and organised crime.

Customs are involved in the implementation of Community regulations relating to external
trade, not only for duty or trade regulation purposes, but also as regards environmental, anti-
dumping, consumer protection, cultural and agricultural controls.

Furthermore, the customs declaration is the privileged support of statistical data as regards the
external trade of the European Union with the rest of the world. Therefore, in a similar
manner to the statistical services, customs need to ensure the maintenance of relevant and
quality statistical information without unduly burdening for the declarants, or the adaptation
of the statistical system to the evolution of the international environment.

their national
In the majority of Member States, customs are also involved, under
responsibilities, with many activities relating to the fight against
traffic in drugs,
pornography and organised crime as well as supporting the work of other services (police,
immigration etc.). Customs generally perform community or national duties simultaneously
and without distinguishing between them.

illicit

The prospect of enlargement, with new Member States having to execute the same extensive
range of tasks, merely serves to emphasise the importance of ensuring not only that customs
work effectively in today's Community but that they also prepare for their colleagues to act
effectively in an enlarged Community.

It is important that Member States concentrate their capacities for controls on the external
trade of the Union as, since the creation of the Internal Market on January 1 1993, border
controls may not take place on intra-community exchanges unless specific suspicion gives
rise to individual control. Such controls may not be systematic or concentrated on the border
region of the Internal Border to any greater extent than the remainder of the territory of the
Member States.

This communication highlights the main customs issues to be addressed and recommends
actions to ensure customs administrations are able to meet their obligations at the Community
level in the years to come.

4

2.

A CHANGING ENVIRONMENT

Following the creation of the single market, much progress has been made in the customs
area, particularly in the legislative field where the adoption of the Community Customs Code
and its implementing provisions provide a platform for actions. The incorporation of tariff
related legislation into the Community's integrated tariff (TARIC) has also a big impact on the
application of trade and economic policy, particularly in ensuring uniformity for economic
operators in the application of tariff measures.

TARIC is an information system managed by the Commission, which compresses more than
4000 Community legislative acts into one electronic publication of 18 000 lines. It is updated
and transmitted to Member States each working day in 11 Community languages.

Customs in the Community operate under a common legal framework based on common
Application provisions and a Common Customs Tariff. Legally therefore most measures are
in place.

In the operational field matters are quite different; here 15 different administrations with
differing national responsibilities are called upon to act as if they were one when applying the
one customs law and the common tariff. Numerous actions have been carried out to develop
this, not least under the Matthaeus and Customs 2000 programmes. The adoption of the
Customs 20022 programme reinforces and broadens the earlier actions to promote equivalent
operational capacity. Much remains to be done and this work will be the main area where
efforts will need to be concentrated over the coming years.

An area of particular difficulty concerns computerisation, crucial to almost all improvements.
The major, usually long term, investments required at national and Community level for
successful computerisation activities require close co-operation and long term planning.

Furthermore, the rapidly changing world trading environment means that customs must
continually adapt to new demands and pressures. The following illustrates some important
changes affecting customs operations.

2.1

Changing revenue collecting role of customs

Customs role in Community matters has traditionally been inclined towards collecting
customs duties which form a substantial contribution to the Community budget.

Customs continue to execute this important task, but as a result of numerous reductions,
resulting particularly from negotiations conducted within the World Trade Organisation, the
spread of Community preferential agreements with third countries and various autonomous
measures, the proportion of own resources that import duties3 represent is decreasing. The
amounts themselves nevertheless remain significant.

2

3

Decision No 105/2000/EC of the European Parliament and of the Council of 17 December 1999
amending Decision No 210/97/EC adopting an action programme for customs in the Community
(Customs 2000) and repealing Council Decision 91/341/EEC, see OJ L 13 of 19.1.2000, page 1.
I.e. customs duties + agricultural duties.

5

The import duties collected by Member States on behalf of the Community in recent years are
as follows:
€

1997

14 632 millions

(19.1% of the total Community budgetary resources)

€

€

1998

1999

14 608 millions

(17.9%)

14 193 millions

(17.3%)

In this context, it should be noted that, pursuant to Article 2(3) of Council Decision of
29 September 2000 on the system of the European Communities’ own resources4, Member
States shall retain, by way of collection costs, 25% of the amounts of traditional own
resources recorded and recovered or covered by a guarantee, compared to the 10% retained
previously.

Full account should also be taken of the role of customs when it comes to the VAT element of
the Community budget. Customs normally represent the first and last official point of contact
for imported or exported goods liable to VAT. Their controls, particularly for the collection of
VAT at the external borders, are therefore an important element in ensuring goods enter the
tax system rather than disappearing into the black economy and in preventing fraud resulting
from fictitious exports. Coherent customs and tax actions are important elements in any anti-
fraud activities designed to combat, in particular, tax fraud.

Furthermore, in many cases Customs expertise in trade controls and taxation is used by
Member States for national purposes by making their Customs administrations competent for
certain matters which go beyond the pure administration of the Customs Union.

2.2

Increasing external trade regulation

Customs’ work is increasing both because of the increasing international trade and the
growing number of specialised controls they are called upon to apply. The creation of the
single market added an additional level of responsibility to this work. When intra-community
borders were controlled, a mistake made by one customs administration could be corrected by
another and hence damage limited to trade or citizens in an individual Member State. Now,
once goods are cleared in one Member State, damage can be felt across the Community. This
makes the possibility of weaknesses in customs controls extremely sensitive, particularly
where the controls relate to human health or environmental matters. This is of special
significance when it comes to enlargement.

The following two sectors of activity are described as examples.

4

OJ L 253 of 7.10.2000, p. 42.

6

Protection of Intellectual property rights

Illegal activity in this area is growing very rapidly threatening both employment and the
health and security of EU citizens.

€

In 1999 Member States Customs administrations detained over 25 million articles with an
estimated value of
780 million. These included items as diverse as parts of cars, medical
kits, pharmaceuticals, microprocessors, software, textiles, shoes, CDs, toys and a wide range
of household products.

It is very difficult to assess the impact of counterfeiting on EU employment but studies suggest
over 100 000 EU jobs were lost as a result of illegal production in this area which is
considered to represent between 5 and 7 per cent of world trade5.

Counterfeiting is an area subject to exploitation by organised crime particularly for money
laundering.

Environmental and Health controls

Customs are in the front line protecting the Community and the world not only from imports
and exports of dangerous or environmentally harmful products but also in protecting rare
species under the CITES Convention, as well as controlling the Community's heritage when it
comes to exports of cultural goods.

Customs were responsible in the recent Dioxin crisis in ensuring the primary control of the
return of any goods suspected of contamination. Similar actions occurred with irradiated
goods after Chernobyl. The growing interest in this area, means customs will have to work
with other ministries to develop procedures to deal both with future crises and to ensure more
effective general controls.

In 1998 Finnish customs rejected 11 consignments of products due to their excessive
irradiation.

Customs are responsible for over 60% of all seizures of illegal traffic in endangered species
under the CITES convention6.

2.3

Growing and changing patterns of international trade

The increasing globalisation of trade has been even more noticeable in Europe where the
opening up of the former Soviet bloc has seen major new trading developments. The very
high volumes of traffic at the Community’s eastern border bear witness to this.

The increase in trade has also been accompanied by major shifts in the way goods are moved.
The growth in e-commerce increases considerably the number of consignments, makes
identification of importers/exporters more difficult and hence increases the risk of illicit
traffic (particularly drugs and counterfeit products but also weapons).

5

6

According to an OECD study carried out in 1998. See Council doc. 10707/99 Enfocustom 40 PI 45.
World Customs organisation report of the 3rd meeting of the CITES group.

7

Express courier traffic is one sector of the increasing world trade which requires very fast
customs clearance to make it competitive. Rapid clearance is now sought in all areas of
customs work, even where bulk movements are required. To have adequate controls with such
clearance is only possible with modern systems: fully computerised risk analysis based
systems and close co-operation with economic operators as well as customs in trading
partners' countries.

Customs at Brussels International airport clear 150 000 express parcels per day.

A container is handled at Rotterdam every six seconds, 24 hours a day throughout the year.

2.4

Customs as a factor in the competitiveness of EU businesses

Customs are called upon to be involved in the enforcement of trade regulation. Burdensome
or inflexible customs procedures have an impact on the competitiveness of business,
particularly with regards to the major trading partners of the European Union, who have the
advantage of operating with one single customs administration. Customs needs to improve the
service to economic operators by reducing, in particular, compliance costs across the Customs
Union. Emphasis should be given to the importance of modern risk analysis and audit based
controls.

It is also important to maintain a level playing field in the single market in order to ensure the
comparative effectiveness of customs controls.

2.5

Enlargement of the European Union7

Enlargement requires the candidate countries to adapt to the Community acquis. In the
customs union context this requires them to demonstrate their ability to properly implement
the acquis. The latter is essential for protecting the Community’s financial interests and
combatting fraud since any weak link in the external frontier is a passage into the whole of the
Community.

Considerable efforts and some progress have been made in this area, particularly through the
In this context, Member States customs
support provided by the Phare programme.
to the work being executed in
administrations have been providing significant support
accordance with the Customs and Taxation pre-accession strategy agreed with the candidate
countries. The Phare programme has also contributed to the upgrading and modernisation of
customs-related infrastructure and equipment in candidate countries with a view to enhancing
their operational capacity.

The challenge remains high. With enlargement the responsibility for the proper functioning of
the Customs Union will partly shift from customs administrations with long experience in the
application of Community legislation to the relevant services in candidate countries, which
are relatively inexperienced and until now often hampered by a lack of
resources.
Strengthened co-operation between the customs of present and future EU Member States will
be important to help tackle this challenge.

7

See also the Commission’s enlargement strategy report of 8 November 2000.

8

2.6

Increasing importance for indirect taxes

Consistency between customs rules and fiscal rules on indirect taxes becomes increasingly
important, as customs rules often determine the level of intensity of fiscal control on imports,
taxes customs treatment on
exports and intra-Community deliveries. For all
importation/exportation under customs rules marks the beginning or the discharge of fiscal
supervision. The same is valid for intra-Community transfers of goods placed under
suspensive customs arrangements. The conclusions of the High Level Group8 – “Consistency
between Tax and Customs Policies”, presented to the Directors general of the customs and
fiscal administrations of the Member States, highlight the need for further action in this area.

indirect

3.

THE FIGHT AGAINST FRAUD

This area is well documented in numerous Commission papers and particularly in the
Commission's recent Communication9 on this subject. Even so,
the level of customs
involvement in this area makes it appropriate to underline their impact in this area and draw
attention to the need to look at anti-fraud measures holistically rather than essentially as
investigations.

The following elements illustrate this (reference year 1999).

Own resources

–

–

–

The recent Commission report suggested that fraud detected by Member States
266 million.
in the area of traditional own resources in 1999 was as high as
Taken together with the fraud estimated to be involved in new cases being
investigated by OLAF in 1999, the figure rises to
337 million or 2.4% of the
budget concerned. It should also be taken into consideration that this represents
the known fraud, the real figures will be considerably higher.

€

€

Cigarettes head the list of products most affected by fraud (14% of both the
cases notified and the amounts involved), followed by dairy products (cheese
and butter) which represent only 0.5% of the cases but almost 12% of the
amounts involved and motor vehicles (with 1.6% of the cases and 6.2% of the
amounts involved). In 1998 the three products most affected were dairy
products (23%), cigarettes (8%) and textile products (4%).

The traffic in cigarettes from third countries or re-imported after exportation
from the Community remains very significant. Apart from this traffic, a clear
increase in the number of cigarettes imported in containers and falsely declared
as different goods has been noted. Figures for new files opened on cigarettes in
1999 show that the total loss for the Community budget could amount to
€

325 million.

8

9

This is a Commission chaired group of High level Tax and Customs officials from Member States.
The protection of the Community’s financial interests and the fight against fraud – annual report 1999
COM(2000)718 final of 08.11.2000 – Report of the European Anti-Fraud Office (OLAF) : first report
of operational activities 1.6.1999-31.5.2000 of 23.5.2000.

9

–

–

In respect of customs procedures, the most vulnerable to fraud remains that of
entry into free circulation. Behind this however fraud remains heterogeneous.
Smuggling and similar practices
accounted for
approximately 18% of the cases communicated by Member States in 1999
(above the
10.000 threshold). Problems linked to the management of
preferential regimes10 (and thus false or incorrect declarations of origin)
accounted for 8% of the cases.

(undeclared imports)

€

On the other hand, in 1999 transit only represented about 6% of cases and less
than 4% of the amounts involved (above the
10.000 threshold). This confirms
the dissuasive effect of the early warning system for sensitive products but
does certainly not enable this problem to be considered solved.

€

Export refunds

–

–

The expenditure category most affected remains that of export refunds. These
cases represented, in 1999, 38% of the global budgetary impact (28% in 1998)
whilst the expenditure represented only 14% of the total costs of the FEOGA-
Guarantee. This increase is due mainly to a significant increase in cases related
to beef exports.

The products most involved are beef and live cattle, with more than one third
of the global budgetary impact relating to fraud and other irregularities, then
fruit and vegetables (fresh or processed), with more than 15% of the global
budgetary impact, followed by flax (which appeared for the first time amongst
the three most affected products involving more than 8% of the global
budgetary impact).

In addition to this, customs can also have a significant role to play in the fight against fiscal
fraud, which again has an impact on both national and Community budgets. Customs can play
a role in detecting VAT fraud, specifically when high risk goods and traders are involved in
export and import transactions, for instance when import is followed by an intra-Community
supply or an intra-Community supply is followed by an export. To detect false export or other
abuse of export rules is essential in the fight against VAT fraud.

Important work has been carried out by the High Level Group on fraud in the tobacco and
alcohol sectors11, which presented a report, the conclusions of which were endorsed by the
Ecofin Council in May 1998.

Combating fraud requires specialist investigators but their success is dependent upon an
infrastructure of control legislation and adequate resources for its application. Sound anti-
fraud activities therefore begin with clear legislation, made available to the trade and applied
by well-trained officials backed up by adequate resources. These officials in turn must work
closely with their investigation branches and with other departments involved in the fight
against fraud.

10

11

See also the report on the control of traditional own resources on preferential origin regimes which the
Commission presented to the Consultative committee on own resources in December 1999
(doc. Budg/501/99).
This is a Commission chaired group of High level Tax and Customs officials from Member States.

10

A comparison of the 1999 figures relating to the number of declarations presented to customs
(more than 79 million) to the cases of fraud or other irregularities detected and notified to the
Commission (2752 above the
10.000 threshold) in the traditional own resources area shows
the importance of ensuring that customs in the broadest sense are involved in any anti-fraud
work. The close working relationship between these services and the reciprocal exchange of
information between them, particularly when it comes to risk analysis information, are
important factors in combating customs fraud effectively.

€

4.

COMBATING CRIMINAL ACTIVITIES

No look at customs would be complete without examining the larger picture, where customs
have a major role in combating criminal activities, be they organised or individual in nature.
This document does not provide a detailed picture of customs role in the Justice and Home
affairs area, but gives an indication of some of the more important activities involved and
underlines areas for future attention (see annex).

Much work is ongoing in this area and customs are heavily involved. Customs crucial role in
combating drugs trafficking is known. Increased co-operation at European level and with
third countries in developing risk analysis techniques and sharing information in order to
identify routes used and gangs involved and to target checks will allow customs to further
improve their effectiveness in tackling this problem and other forms of smuggling.

Customs important role in combating illegal activities in the following areas is less well
known:

–

–

Money laundering: co-operation between customs is important to deter and
detect cross-border movements of such monies;

Pornography (particularly child pornography): role of customs in preventing
the movement of such materials as well as in identifying producers and
consumers;

– Weapons: role of customs in the identification and detention of arms being

illegally imported and in the identification of traffickers;

–

Applying international sanctions: role of customs in the implementation of
measures such as embargoes.

In addition, customs experience and physical presence at import and entry points means that
during controls they are called upon to intervene in an even wider range of areas where illegal
activities take place.

5.

THE MAJOR CHALLENGES

The main challenge customs face is how to deal with the divergent demands of applying a
growing number of controls to protect
the Community's financial, social and business
interests whilst not creating unnecessary or burdensome barriers to legitimate business.

This can only be done using the best of modern practices and ensuring close co-operation
with other involved agencies and legitimate business circles.

11

To meet these challenges, the whole process has to be looked at, beginning with legislation
and working through all the major areas of interest, which range from matters as basic as
training of officials to major investment in equipment and infrastructure (computers systems,
container scanners etc.).

Simplification of legislation is of particular significance and helps not only to reduce the
burden on economic operators but also assist in combating fraud. Simpler legislation can
reduce the opportunity for fraudsters and, because it
is easier for customs officers to
understand and operate, can improve fraud detection.

These issues will have to be tackled if customs are to help ensure the security of the citizen in
the single market whilst maintaining an attractive climate for business operations and
investment.

The question of availability of resources will be particularly important.

6.

RESOURCES

One area of concern relates to resources, human and financial. For the candidate countries this
is an even more crucial factor, especially where enlargement will mean a reduction in external
frontiers but not necessarily a major reduction in customs work (the loss of national customs
work at external national border posts often being counter-balanced by an increase in
activities to protect the integrity of the Community and facilitate trade).

In the Community interest, it will be important that the heavy investment made by some
Member States to ensure the integrity of the Community's external frontier is not jeopardised
by shortfalls in investment in other Member States. This will be particularly important in the
future for candidate countries, particularly for those with responsibility at
the enlarged
external borders of the European Union. Investment
in all resources, but particularly
expensive equipment, needs to follow a strategic approach taking full account of the single
market context.

Equipment, such as container scanners, can bring significant results, but the present very
scattered distribution means control is piecemeal. A more strategic approach should be
adopted if such investments are not to be devalued by the diversion of fraudulent traffic to
less well-equipped customs posts. Their future versions would be portable and less expensive
than those available today. Portable equipment would thus constitute a restraining and
psychological deterrent for those operators within international trade who are trying to
circumvent regulations. It must be stressed that scanners are used as an example here only; the
same can be said to apply to resources on training and computerisation.

Investment in customs can very quickly pay for itself. The new container scanner introduced
€
14 million was used on 12000 containers in
recently in Rotterdam at a cost of less than
€
1999, leading in the first six months of use to recovery of more than
20 million in Customs
duties, value added taxes and excise duties as well as the detection of numerous smuggling
offences.

12

It is also appropriate, in the framework of the changing role of the Commission, to consider
in particular in the
the possibilities offered by the externalisation of certain activities,
management of programmes supporting the development of co-operation in the customs
union.

7.

STRATEGIC OBJECTIVES

The strategic objectives for the Customs Union in the coming years could be defined as
follows:

1.

2.

3.

providing a framework for
transparent and stable rules, applied coherently

the development of

international

trade based on

providing the Community and Member States with budgetary resources

protecting society from unfair international trade and damage, notably in terms of
financial, commercial, public health, cultural and environmental interests.

To fulfil these objectives effectively customs will have to operate in a non-bureaucratic
environment with less recourse to paper, based upon fully harmonised, clear legislation, the
application of which, whilst respecting the principle of equal treatment, can be adapted to
meet the specific needs of individual operators and which offers an acceptable level of
control.

The use of information technology is central to this concept and the development of a credible
strategy concerning information networks and the full use of information technology in the
Customs Union is essential (e-Customs).

This approach needs to be incorporated into a global and adequately prioritised programme
for computerisation. Successful computerisation will enable a reliable exchange of
information between customs administrations and between economic operators and the
administrations concerned. In this context, it is necessary to exploit to the full the use of all
potential resources and to promote the interoperability and synergy between the Commission
and national administrations with regard to the development of computer systems.

Further rationalisation of administrative procedures is required, necessitating modifications to
Community customs legislation. For example, it is essential that future proposals concerning
customs legislation affecting other Community policies, such as agriculture and fisheries, take
greater account of the impact of the measures envisaged on the principles and objectives of
the Community policies concerned. Furthermore,
the customs union shall ensure that
proposals for regulations relating to other Community policies and requiring the co-operation
of customs for their implementation be better taken into account.

Customs is the world’s trade interface and must take account of demands for trade facilitation
coming from the international fora such as the G-7 and the proposals for simplification of
Customs procedures resulting from World Customs Organisation activities, for instance in the
case of the Kyoto Convention. The discussion on the single window approach, where customs
act as economic operators' primary contact for all trade movements is one point worthy of
particular attention. Such an approach provides economic operators with time and financial
savings and also gives the best possibility of ensuring international goods enter the control
system.

13

Customs have an important role to play in fighting fraud (including the fight against VAT and
Excise fraud), combating organised crime and in ensuring a coherent approach to customs
actions in the national and community areas. This will require closer co-ordination and
coherency of actions in these areas.

8.

PROPOSALS FOR ACTIONS

Following the defined strategic objectives, the proposals listed below provide an outline of the
major points proposed for action. A more detailed breakdown is found in the annex to this
document. The proposals must be read in conjunction with the principles relating to the co-
responsibility of the Commission and Member States in this area, in particular the ongoing
work under the Customs 2002 programme, as well as the previous section on resources.

Five main areas are concerned:

8.1

Legislation

Customs legislation is well established but continuing changes are required in order to tackle
fraud issues and to take account of changing business trends. The emphasis in this sector is
more on promoting the use of modern techniques and greater spread of information to help
customs and economic operators apply the legislation in a consistent manner.

Key areas include:

–

–

–

–

–

–

Continuing the simplification and rationalisation of legislation

Ensuring all relevant legislation permits use of electronic data submissions

Involving economic operators at an early stage in the preparation of legislation

Improving the connection between legislation and its implementation

Producing guidelines to assist economic operators for complex legislation

Continuing work on the harmonisation of sanctions

8.2

Operations

If customs legislation can be said to be well established and uniform, the same cannot be said
for operations as legitimate businesses and the fraudsters know only too well.

Key actions include:

–

–

–

–

–

Improving the standards of controls

Improving practical co-operation between customs

Improving the application of existing controls by tackling specific problem
areas

Better use of risk analysis, especially when it comes to economic operators

Reinforcing the fight against counterfeiting and piracy

14

–

–

–

–

–

Combating false origin marking

Completing the implementation of the New Computerised Transit system

Developing a new Information Technology strategy to support paperless
customs and the inter-operability between national systems

Improving co-operation between customs and other agencies (tax, police etc.)

Developing “joint audit modules” between the Commission and the Member
States

8.3

Improve the service to the business community

Closer relations between customs and business will be necessary to handle the expected
growth in international traffic, particularly resulting from e-commerce.

Key actions include:

–

–

–

–

Simplification and harmonisation of procedures

Provide
information

electronic

access

to customs

information, particularly tariff

Continue work on trade facilitation

Use consultation and Memoranda of understanding to strengthen co-operation

8.4

Training

Training activities are required not only for customs officials but, as the burden of control is
shared with business, also for economic operators.

These activities involve investing in human resources and should take place in the context of
lifelong learning.

Key actions include:

–

–

–

Complete work on common training modules

Complete feasibility study on an European Customs academy

Address training towards problem areas and supporting business compliance
efforts

8.5

International role of customs

Key areas for attention include:

–

Appropriate representation of the Community in the international fora dealing
with customs (World Customs Organisation, World Trade Organisation, G7,
etc.). The current work on the Community membership of the WCO fits into
this context. Furthermore the WTO negotiations on trade facilitation should

15

also develop rules for simplified trade and customs procedures and result in the
adoption of simple import and export procedures worldwide.

–

Promotion of international co-operation. Most of this activity will focus on the
the pre-accession strategy to prepare the
continued implementation of
candidate countries for enlargement. Actions will be required to improve
trading and fraud combating activities by promoting customs co-operation. The
potential of the agreements on customs co-operation and administrative mutual
assistance that the Community has concluded with certain of its major trading
partners
should be exploited to the full. These agreements will be
supplemented by agreements with other countries, in particular China.

9.

CONCLUSIONS

Customs must adapt to a changing environment. In order to able to take the necessary steps,
as described in this Communication, they have to be able to rely on the support of the
European institutions, the Member States and the economic circles concerned.

16

ANNEX

ORIENTATIONS FOR ACTIONS

LEGISLATION

fraud-proofing work on existing and new legislation

production of a manual and support service for legislators drafting laws to be applied
by customs

set up a system of feedback from customs administrations and operators on
flaws/difficulties relating to legislation

initiatives to improve the coherency between customs legislation and rules for
indirect taxes and improved administrative co-operation between Customs and Tax
Authorities;

1.

a)

–

–

–

b)

adapting legislation to reduce the burden on economic operators:

–

–

–

–

–

c)

introduction of generally applicable simplified procedures based on the reliability of
operators

continue the legislative moves towards enabling the use of electronic rather than
paper submissions

continue the simplification and rationalisation of the combined nomenclature

continue the simplification and modernisation of the customs procedures (customs
procedures with economic impact, transit, origin).

continue work on the harmonisation of sanctions

ensure, in appropriate cases, that where new legislation is adopted, the need for
training/guidelines/manuals is considered for both customs administrations and
economic operators.

2.

OPERATIONS

Increase the effectiveness of customs operations, and particularly controls by:

a)

introducing greater standardisation of controls, including:

–

–

–

creation of standards for the different types of controls (documentary and physical
checks, audit etc.)

creation of a mechanism to improve the application of new controls (contact network
and off the shelf control frameworks)

harmonisation of standards applied by customs laboratories

17

b)

improve the application of existing controls

–

–

–

–

–

–

examine the existing range of Community controls and address areas of specific
difficulty (via training, manuals etc.)

improve the flow of information and assistance between Member States' customs
administrations and the Commission (in particular all customs offices should
receive/transmit updated tariff and control information electronically)

improve exchange of information with Tax Administrations on transactions of
importance for detecting fiscal fraud

better use of risk analysis, particularly when it comes to:

–

–

–

assessment of economic operators

establishing of profiles

exchange of information

risk based controls on exports to detect fraud, in particular fiscal fraud

improve the practical co-operation between Member States by the extension of the
RALFH12 inter-port co-operation project to cover other ports and to implement a
similar action for major international airports

c)

completing the implementation of the New Computerised transit system (NCTS)

This work will not only significantly improve the controls and services offered to Operators
for transit traffic but will also lay down much of the informatics infrastructure which can be
exploited to dramatically improve the availability of information to customs and economic
operators alike. This action effectively pilots the creation of a truly computerised customs
network and computer platform Common Communications Network, Common System
Interface (CCN/CSI), which will be the basis for many new initiatives.

d)

developing a new IT strategy to ensure:

–

–

–

–

12

build on the NCTS actions to promote modernisation and better use of resources in
other areas notably via CCN/CSI

support the creation of a non-bureaucratic environment, limiting the use of paper
documents to the minimum

provide updated and transparent information available via electronic means (Internet
etc.).

fostering the inter-operability and synergy between the Community elements of
Member States' national computer systems

Customs 2002 funded project to improve practical co-operation between Rotterdam, Antwerp, Le
Havre, Felixstowe and Hamburg ports (includes exchanging risk analysis information, experience in use
of container scanners etc.).

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e)

f)

g)

h)

3.

a)

b)

c)

d)

e)

f)

4.

a)

identify and make recommendations on the customs resources (including
equipment) required at Community frontiers

continue to develop actions to promote greater co-operation between customs and
other agencies (police, immigration, health, environment and other services)

undertake joint actions to fight against customs related organised criminal activities

increase the coherency between customs and tax activities

IMPROVE THE SERVICE TO THE BUSINESS COMMUNITY

work with the business community to simplify customs operations wherever possible

provide economic operators with electronic access to customs information,
particularly the consolidated Customs Code, Tariff and Implementing Provisions.

fund benchmarking exercises and make recommendations to encourage the use of
the single window concept

work more closely with economic operators to develop and promote trade
facilitation activities

promote the adoption of Memoranda of Understanding between operators and
customs administrations

improve consultation with the trade on all relevant actions of this strategy

TRAINING

Customs Academy

On the basis of a feasibility study examine the appropriateness of creating a customs
academy.

b)

c)

5.

a)

b)

completing the common training modules

focussing training on problematic areas

THE INTERNATIONAL ROLE OF CUSTOMS

ensure the appropriate representation of the Community in the international fora
dealing with customs (World Customs and World Trade organisations, G7 etc.)

promote international customs co-operation.

19