REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Third Progress Report on the implementation of the EU Strategy and Action Plan for customs risk management
Date: 2021-01-18
Institutions: Directorate-General for Taxation and Customs Union, European Commission
Subjects: EU action, EU control, EU strategy, customs cooperation, customs regulations, customs territory (EU), customs union, exchange of information, import policy, institutional cooperation

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 18.1.2021  COM(2021) 9 final  REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Third Progress Report on the implementation of the EU Strategy and Action Plan for customs risk management  {SWD(2021) 2 final}  
 
 
1. 

INTRODUCTION 

Customs  authorities  handle  a  substantial  and  constantly  increasing  volume  of  goods. 
They need to facilitate increasing amounts of legitimate trade and at the same time, they 
are continuously engaged in fighting fraud and the smuggling of illicit or unsafe goods. 
Meanwhile, major challenges such as the current public health crisis, the consequences of 
the  UK’s  departure  from  the  EU's  single  market  and  Customs  Union,  and  the  rise  of 
digitalisation and e-commerce affect the work of customs. 

Risk  management  allows  customs  authorities  to  better  identify  and  target  those 
consignments that present a risk. It allows addressing those risks at  the best moment in 
the supply chain to ensure the security and safety of EU residents and the protection of 
the financial interest of the EU and its Member States. It also allows optimising the use 
of customs resources. 

In  2014,  the  Commission  adopted  an  EU  strategy  and  action  plan  for  customs  risk 
management1.  The  strategy  applies  to  the  2014-2020  period  and  identifies  seven  key 
objectives  underpinned  by  the  overall  aim  of  reaching  a  high  quality,  multi-layered 
approach  to  risk  management.  The  action  plan  set  out  concrete  measures  for  each 
objective.  Following  the  Council’s  request,  the  Commission  presented  a  first  progress 
report2 on the implementation of the strategy and action plan in July 2016, and a second 
one in July 20183. 

In its conclusions of January 2019 on the second progress report, the Council welcomed 
the  progress  made  in  implementing  the  strategy, including  the  strengthening  of 
collaboration  between  all  the  actors  involved,  the  launching  of  new  initiatives  –  in 
particular the Commission’s decision on financial risk criteria – and the participation of 
customs  administrations  in  security-related  activities. It  also  underlined  that  risk 
management is an ongoing process - not limited to specific actions with clearly defined 
start  and  end  dates  -  and  that  customs  authorities  must  continue  to  innovate  and  be 
prepared  to  respond  to  new  or  emerging  threats.  In  its  January  2019  conclusions,  the 
Council  invited  the  Commission  to  present,  within  2  years,  a  third  and  final  progress 
report on the implementation of the current strategy covering the period 2019-2020.  

This third progress report is the Commission’s response to that request. Like the previous 
reports,  it  provides  an  overall  qualitative  assessment  of  the  implementation  of  the 
strategy,  setting  out  the  progress  made  on  each  of  the  seven  key  objectives  since  the 
second report. It highlights, objective by objective, the most significant advances and the 

COM(2014) 527 final. 

1 
2 
First Progress report on the implementation of the EU  strategy and action plan  for customs risk 
management.https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52016DC0476&from=EN 
(for the period 2015-2016). 
3 
Second progress report on the implementation of the EU strategy and action plan for customs risk 
management.: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52018DC0549&from=en 
(for the period 2017-2018). 

1 

 
 
                                                           
problems  encountered,  while  the  accompanying  Commission  Staff  Working  Document 
provides a deeper analysis. 

2.  PROGRESS REPORT 

2.1.  Objective 1 - Improving data quality and filing arrangements 

The  objective  of  setting  up  a  comprehensive  legal  framework  with  requirements  for 
‘multiple filing’ of data for security risk analysis where entry summary declaration data 
will be provided in layers and for improving data quality has been reached, although its 
full implementation remains to be achieved. 

The legal framework 

The legal framework consists of the Union Customs Code (UCC) and the detailed rules 
contained in the delegated and implementing acts. The Code entered into force on 1 May 
2016.  In  2020,  the  UCC  implementing  and  delegated  acts  were  further  updated  to 
integrate the rules on advance information and the analysis of security and safety risks. 

The Union Customs Code evaluation 

The Commission has recently launched an evaluation of the UCC to be finalised by the 
end  of  2021.  It  aims  to  establish  whether  the  legislation  and  the  operational  electronic 
systems  by  that  date  are  still  appropriate  for  ensuring  modernised,  streamlined  and 
simplified processes to assist compliant traders and customs authorities. 

The  evaluation  will  inform  future  decisions  on  whether  the  Code  and  its  implementing 
and  delegated  acts  should  be  revised.  It  will  in  particular  consider  whether  the  UCC  is 
flexible enough to  deal  with  the management of customs formalities during crises such 
as the current pandemic and in light of new business models such as e-commerce. 

The development and implementation of appropriate IT solutions 

The full implementation of the UCC relies on 17 electronic systems. 

While tangible  progress  is  being  made in  this  area and eight  systems  have  already  been 
deployed and are now operational, nine are still under development. This is in line with 
the UCC work programme planning. For further details, see the next chapter. 

2.2.  Objective 2 - Ensuring availability of supply chain data, sharing of risk-

relevant information and control results 

The  Commission,  together  with  the  Member  States  and  businesses,  has  continued  to 
develop the IT systems that support the full implementation of the Code. Since the last 
progress  report,  important  milestones  have  been  reached  in  the  development  and 
deployment  of  the  planned  IT  systems  as  well  as  on  rules  to  provide  or  exchange 
information.  The  full  set  of  IT  systems  will  further  modernise  and  harmonise  import, 
export and transit processes, and introduce new concepts such as centralised clearance. 

2 

 
 
The new Import Control System (ICS2) 

For goods entering the EU, the reform of EU advance cargo information system (ICS) is 
progressing  well.  The  system  aims  to  inform  customs  authorities  about  the  arrival  of 
goods well before their actual shipment. The development of ICS2 is ongoing and a first 
delivery is expected in spring 2021. The full system will be delivered in three releases as 
detailed  in  the  accompanying  Staff  Working  Document.  The  system  is  expected  to  be 
fully  operational  in  October  2024  and  will  significantly  improve  the  analysis  of  safety 
and security risks. 

Other projects and systems 

The  ‘Surveillance  3’  (SURV3)  system  collects  information  provided  in  customs 
declarations  and  stores  it  in  a  database.  SURV3  upgrades  the  earlier  (SURV2)  system 
and aligns it with UCC requirements. The database records and centralises EU trade data 
(imports  and  exports)  that  national  customs  authorities  extract  from  their  systems  and 
transmit to the Commission on a daily basis. The use of the data analytics platform began 
with the deployment of a Trade Flow dashboard in March 2020. More functionalities will 
be added in due course to allow the Commission to better exploit surveillance data.   

The  Customs  Union  Performance  (CUP)  is  used  as  a  management/steering  tool  for 
evidence-based policy formulation and strategic  decision-making as well as to  evaluate 
performance  and  monitor  trends.  The  CUP  is  gradually  developing  key  performance 
indicators to evaluate how Member States are performing customs controls, to highlight 
the  impact  of  Customs  in  collecting  revenues  for  the  EU  budget,  to  ensure  safety  and 
security  of  the  EU  citizens,  to  protect  the  internal  market,  and  to  emphasise  the 
importance  of  Customs  administrations’  contribution  to  growth,  competitiveness  and 
innovation goals in line with the Europe 2020 agenda.  

The  Common  information-sharing  environment  (CISE)  promotes  the  exchange  of 
relevant  maritime  information  between  the  different  authorities  involved.  It  has  made 
significant  progress  by  entering its transitional phase (2019–2021) managed  and led by 
the  European  Maritime  Safety  Agency  (EMSA)  in  close  cooperation  with  the  Member 
States. 

The  Digital  Transport  and  Logistics  Forum  (DTLF)  led  by  the  Commission  brings 
together  transport  and  logistics  experts  and  stakeholders  from  both  the  private  and  the 
public sector, with a view to building a common vision and roadmap for digital transport 
and logistics. In April 2020, the Council adopted new rules, which will make it easier for 
freight  transport  companies  to  provide  information  to  authorities  in  digital  form. 
Increased  digitalisation  of  freight  transport  and  logistics  will  bring  significant  cost 
savings for businesses, and make the transport sector more efficient and sustainable. 

The  Trade  Control  and  Expert  System  (TRACES)  is  the  European  Commission’s 
multilingual online management tool for all sanitary and phytosanitary requirements on 
intra-EU trade and imports of animals, semen and animal embryos, food, feed and plants. 
Its main objective is to digitalise the entire certification process, in line with the Digital 

3 

 
Agenda  for  Europe4.  The  Commission  has  initiated  a  new  project  in  the  form  of  the 
development  of  an  IT  system  for  electronic  submission  and  management  of  catch 
certificates  under  Regulation  (EC)  1005/20085  on  establishing  a  Community  system  to 
prevent, deter and eliminate illegal, unreported and unregulated fishing. This new system 
will  assist  Member  States'  authorities  in  carrying  out  their  verification  and  risk 
management tasks in relation to imports of fishery products into EU.  

The  EU  Single  Window  Environment  for  Customs  initiative  aims  to  facilitate  the 
automated verification of supporting documents provided with the customs declaration at 
customs  clearance.  As  such,  it  will  be  an  instrument  to  support  the  coordination  of 
controls between customs and partner competent authorities at the border and to provide 
feedback to economic operators on controls.  The Single Window links national customs 
systems  and  EU  e-licensing  solutions  such  as  TRACES  or  the  Dual  Use  Goods  export 
system. 

2.3.  Objective 3 - Implementing control and risk mitigation measures where 

required (‘assess in advance - control where required’) 

The  third  objective  (‘assess  in  advance  -  control  where  required’)  is  central  to  the 
strategy in the sense that all the other objectives should ultimately contribute to enabling 
custom  authorities  to  better  target  their  controls  in  terms  of  when  and  where  they  take 
place.  Major  progress  has  been  made  on  Objective  3,  notably  on  Priority  Control  Area 
(PCA),  financial  risks  and  product  compliance  and  safety.  The  Commission  is  also 
further developing and expanding the use of Credibility Checks.  

Priority Control Area (PCA) 

PCA  is  a  key  mechanism  in  the  Customs  Risk  Management  Framework  (CRMF)  that 
enables the EU to designate specific areas to be treated as a priority for customs controls. 
The PCA tool has been used to coordinate EU customs actions in most major risk areas 
already since 2007, delivering operational results and providing strategic lessons. During 
crisis, priorities must change, and PCAs are therefore replaced by joint actions that focus 
on the particular crisis. This was the case for COVID-19 in 2020. 

Financial Risk Criteria (FRC) 

The  Commission’s  inspections  on  traditional  own  resources  (TOR)  as  well  as  previous 
work on EU action to reduce the customs gap have pointed to a lack of harmonisation in 
the  performance  of  customs  controls  for  mitigating  the  risk  of  undervalued  imports 
throughout the Customs Union.  

4 

https://ec.europa.eu/digital-single-market/ 

5  OJ L 286, 29.10.2008, p. 1. 

4 

 
                                                           
In May 2018, the Commission adopted an important implementing decision, which lays 
down measures for the uniform application of customs controls by establishing common 
financial risk criteria and standards (FRC)6. 

The FRC are a set  of rules that allow the Member States customs clearance systems  to 
systematically  identify  (or  ‘flag  electronically’)  transactions  that  present  a potential 
financial risks and that require further scrutiny and/or control action. They encompass the 
majority  of  known  financial  risks  and  help  provide  a  more  consistent  approach  to 
customs controls. 

The  FRC  decision,  only  available  to  customs  risk  management  experts  in  the  Member 
States, enables Member States to  address  financial risks in  an equivalent manner at  the 
external border, without placing an undue burden on legitimate trade. It also identifies the 
most opportune time and place of the control depending on the scope and nature of the 
risk and on the availability of data and documentation. 

Product safety and compliance 

In  2019,  the  European  Parliament  and  the  Council  adopted  Regulation  2019/1020  on 
market surveillance and compliance of non-food products with EU legislation7. This new 
legislation strengthens the legal framework for controls on goods entering the EU. It will 
significantly  boost  cooperation  between  customs  and  market  surveillance  authorities  in 
view  of  more  effective  checks  on  imported  products.  The  new  regulation  will  apply  in 
full from 16 July 2021. Preparations for its efficient implementation are under way. 

Credibility checks 

Credibility  checks  (CC)  were  introduced  via  TARIC  in  the  Member  States  national 
systems  in  2013  and  are  being  continuously  developed  and  expanded.  They  are 
automated checks introduced at the clearance stage of imports that assess the validity of 
the  values  declared.  CC  check  the  compatibility  of  entries  in  the  customs  declaration 
against specific parameters and, in the case of noncompliance, either block them or flag 
them - creating a warning so that Customs authorities may check the declaration. 

2.4.  Objective 4  - Increasing  capacity to ensure effective implementation of 
increase 

the  Common  Risk  Management  Framework  and 
responsiveness to newly identified risks 

to 

Improving the implementation of the Customs Risk Management Framework 
(CRMF) 

Member  State  customs  administrations  have  prioritised  the  improvement  of  CRMF 
implementation,  and  have  taken  a  number  of  actions  in  this  area.  This  has  increased 

6 C(2018)3293 final. 

7 Regulation (EU) 2019/1020 of the  European Parliament and of the  Council of 20 June 2019 on  market 
surveillance  and  compliance  of  products  and  amending  Directive  2004/42/EC  and  Regulations  (EC) 
No 765/2008 and (EU) No 305/2011. OJ L 169, 25.6.2019, p. 1-44. 

5 

 
                                                           
cooperation  and  the  sharing  of  risk  information  between  Member  States,  including 
through  Customs  Risk  Management  System  (CRMS),  and  improved  financial  risk 
management. Several Member States have also reported an improvement in risk analysis, 
thanks to new or improved IT systems and the recruitment or training of staff. 

However,  many  Member  States  also  reported  obstacles  that  have  kept  them  from 
implementing all the desired actions or making further progress. The biggest challenges 
are insufficient IT infrastructure, financial constraints, and lack of human resources and 
data availability. 

The Customs Risk Management System (CRMS) 

The  CRMS  is  a  common  database  where  forms  and  messages  are  sent  and  stored. 
Member States can consult it to identify which information needs to be introduced into 
the national risk analysis system or communicated with each other.   

Since  2005,  the  CRMS  has  regularly  been  updated  to  add  new  functionalities  and 
improve its user-friendliness. In 2016, a complete revision (‘CRMS2’) was decided based 
on the experience acquired with the Member States and users of the system. The first step 
(analysis  of  the  CRMS  2  requirements)  has  now  been  completed  and  the  development 
phase is under way. This will be followed by a testing phase, before CRMS2 is foreseen 
to go live in Q4 2021. 

A  specific  COVID-19  crisis  alert  was  opened  on  4 February  2020  in  the  CRMS/crisis 
management to allow Member States to share and receive information and guidance on 
prioritising risks for customs  controls  related to  COVID-19. Since then,  more than 400 
Risk  Information  Forms  (RIFs)  were  issued  on  dangerous  and  non-compliant  medical 
products, medical devices and personal protective equipment. 

Thematic working groups 

Many  EU-level  working  groups,  comprised  of  representatives  of  the  European 
Commission  and  the  Member  States,  are  actively  working  on  key  issues  to  improve 
customs controls and risk management capacities. 

Nearly all Member States participate in one or more contact or expert groups established 
under  the  Customs  programme  to  increase  cooperation  on  the  ground  and  coordination 
between customs administrations at the EU’s external frontiers. Such groups include the 
European  Land  Frontier  Contact  Group  (LFCG)  and  several  ports  and  airports  contact 
groups  (RALFH, ODYSSUD and  ICARUS). Several  Member States  also  participate in 
the  Customs  Eastern  and  South-Eastern  Land  Border  Expert  Team  (CELBET),  which 
aims to strengthen and improve operational cooperation at this EU border. 

2.5.  Objective  5  -  Promoting  interagency  cooperation  and  information 
sharing between customs and other authorities at Member State and EU 
level 

Interagency cooperation and information  sharing between customs and other competent 
authorities at Member State and EU level is highlighted in the strategy as an important 

6 

 
means  of  ensuring  more  effective  risk  management  and  improving  safety  and  supply 
chain security. 

Improving  cooperation  and  information  sharing  with  other  authorities  is  a  high  priority 
for most Member States. While further progress has been made in setting up interagency 
agreements  and  memoranda  of  understanding,  most  Member  States  reported  that 
improvements  in  integration  of  risk  information  or  enhanced  risk  management  practice 
has been limited due to legal constraints related to insufficiently aligned requirements for 
data privacy and the protection of fundamental rights, among other factors. The multiple 
legal  frameworks  at  play  in  interagency  cooperation  are  viewed  as  hampering 
coordination and common priority setting. 

The Commission department responsible for customs matters is actively involved in the 
Security  Union  activities,  and  the  Customs  Cooperation  Working  Party  has  been 
addressing a number of relevant priority areas.  

Safety 

The Official Controls  Regulation (EU)  2017/6258 entered into force in  December 2019 
establishing an integrated approach to import controls of foodstuffs, feed and livestock. 
Furthermore,  the  Commission  proposal  for  an  EU  Single  Window  Environment  for 
Customs  will  allow  collaborative  processing,  sharing  and  exchange  of  information  and 
better risk assessment for government agencies. 

Intellectual property rights (IPR) 

In  November  2020,  the  Commission  adopted  the  IP  Action  Plan9,  which  aims,  among 
others, to improve the enforcement of IPR, in particular by strengthening the capacity of 
law  enforcement  authorities,  supporting  Member  States’  customs  authorities  in 
improving  risk  management  and  anti-fraud  actions10,  and  establishing  an  EU  Toolbox 
against  counterfeiting.  The  Toolbox  aims  to  (i)  clarify  roles  and  responsibilities  of  all 
involved  players  (right  holders,  suppliers,  various  sets  of  intermediaries11  and  public 
enforcement  authorities,  including  customs  authorities),  and  (ii)  identify  ways  to 
reinforce  cooperation  between  them,  in  particular  on  sharing  of  relevant  data  on  goods 
and traders. 

Improving cooperation with law enforcement authorities 

A  large  majority  of  Member  States  are  carrying  out  or  have  completed  activities  to 
improve  cooperation  with  law  enforcement  authorities.  This  includes  participating  in 
projects  and  joint  operations  with  Europol  and  national  law  enforcement  agencies, 

8 OJ L 95, 7.4.2017, p. 1. 

9 COM(2020)760. 

10 COM(2020) 581 final 
11  e.g.  online  platforms,  social  media,  the  advertising  industry,  payment  services,  domain  name 

registrars/registries, and transport and logistics companies. 

7 

 
                                                           
cooperation  agreements  and  information  sharing,  and  cooperating  to  prepare  for  the 
implementation of ICS2. 

Some  Member  States  have  however  voiced  difficulties  -  such  as  legal  challenges, 
insufficient  human  and  financial  resources  and  lack  of  IT  tools  -  that  have  kept  them 
from  implementing  the  desired  actions  or  making  more  progress  in  cooperation  with 
other authorities at Member State and EU level. 

The European agenda on security 

As gatekeeper for the flows of goods at the external EU borders, EU customs authorities 
play a crucial role in protecting the EU and its citizens, as well as protecting international 
supply  chains  from  criminal  activities  and  terrorist  attacks.  By  implementing  the  EU 
strategy and action plan for customs risk management, the Commission contributes to the 
implementation  of  the  European  agenda  on  security.  The  new  2020-2025  EU  Security 
Union Strategy12  adopted on 27 July 2020 refers to the importance of a secure external 
border  and  the  crucial  role  of  customs  in  the  fight  against  cross-border  crime  and 
terrorism. It also refers to the action plan ‘Taking the Customs Union to the next level’ 
adopted  on  28 September  202013,  which  has  announced  actions  to  strengthen  risk 
management and to enhance internal security, including by assessing the feasibility of a 
link between relevant information systems for security risk analysis.  

The Customs Cooperation Working Party (CCWP) Action Plan 

The  focus  on  IPR  infringements  continued  under  the  CCWP’s  9th  action  plan  (2018-
2019) and activities in this domain are expected to continue under the next action plan. 

Similarly, CCWP actions have been developed for environmental crimes. The 10th action 
plan  for  2020-2021  includes  actions  focussed  on  the  transboundary  movement  of 
hazardous and other waste, illegal trafficking in ozone-depleting substances and on trade 
restrictions, in order to promote environmental sustainability. 

Customs  authorities  have  also  been  integrated  into  the  Serious  and  Organised  Crime 
Threat Assessment (SOCTA) reporting mechanism through a dedicated CCWP action on 
the  "‘Better  integration  of  customs  in  the  EU  SOCTA’.  The  10th  CCWP  Action  Plan 
includes a specific follow-up action in this area. 

At the same time the synergies between the EU Policy cycle 2018-2021 / EMPACT and 
the 10th CCWP Action Plan 2020-2021 are further strengthened with a view to align and, 
where appropriate, integrate CCWP actions under the EU Policy Cycle.  

12  COM(2020) 605 final. 

13  COM(2020) 581 final. 

8 

 
                                                           
2.6.  Objective 6 - Improving cooperation with trade 

Cooperation between customs and trade has mainly improved thanks to the strengthening 
of  the  Authorised  Economic  Operator  (AEO)  concept.  Member  States  have  broadly 
expressed  that  the  results  of  this  EU  programme  -  including  increased  access  to  and 
quality  of  data  and  the  increased  awareness  of  the  AEO  programme  and  enhanced 
cooperation and communication with trade - have led to better-focused control activities 
and  to  the  facilitation  of  legitimate  trade.  A  minority  of  customs  administrations  have 
encountered  significant  challenges  that  have  kept  them  from  implementing  desired 
actions or making more progress in their cooperation with economic operators. The few 
challenges  broadly  concerned  IT  systems,  lack  of  human  capacity  and  expertise,  and 
legislation - including GDPR. 

Strengthening the EU AEO Programme 

The Commission  and the Member States have agreed on a  comprehensive strategy and 
methodology  to  improve  the  robust  implementation  of  the  programme,  including  by 
strengthening  the  links  to  customs  risk  management.  There  is  also  a  plan  to  increase 
further the understanding of the programme through awareness raising-strategies, which 
are to be jointly developed with traders.  

These activities include in particular fact-finding visits by the Commission to all Member 
States to assess how the AEO programme is implemented and to identify best practices. 
These  visits  started  in  July  2019  but  were  put  on  hold  in  2020  due  to  the  COVID-19 
situation. First findings include a number of best practices, which will be made available 
to all Member States.   

Moreover,  there  are  a  number  of  weaknesses,  which  have  also  been  identified  by  the 
European Court of Auditors (ECA), particularly as regards internal controls, monitoring, 
cooperation  between  AEO  and  risk  management  services,  and  the  specific  situation  of 
express couriers/postal services. These topics will be need to be addressed through inter 
alia an amendment of the AEO Guidelines and - where necessary - the legal provisions. 

The eAEO direct trader access 

The  AEO  module  (e-AEO)  of  the  EU  Customs  Trader  Portal,  designed  by  the 
Commission together with the Member States, started operating on 1 October 2019 (for 
its first phase) and 16 December 2019 (for its second phase). It provides a single point of 
access  to  the  AEO  and  BTI  systems.  It  facilitates  and  speeds  up  the  exchange  of 
information,  communications  and  notifications 
to  AEO  applications, 
authorisations  and  their  management  processes  as  set  out  in  in  the  UCC  and  related 
delegated and implementing acts. The module aims to harmonise the access to different 
EU customs systems for economic operators. All other EU customs systems are expected 
to connect to this portal in the near future. 

related 

9 

 
2.7.  Objective  7  -  Tapping  the  potential  offered  by  international  customs 

cooperation 

Cooperation  and  exchange  of  customs-related  information  with  third  countries  play  an 
important role in the area of the Customs Union and common commercial policy. 

The Commission represents the EU in the World Customs Organisation (WCO), ensuring 
that  EU  principles  and  rules  are  embedded  in  international  standards,  in  particular  in 
areas  of  importance  for  customs  risk  management  such  as  nomenclature  and 
classification of goods, e-commerce, and security and safety. The Commission also quite 
recently  started  actively  participating  in  the  revision  of  the  Kyoto  Convention  and  the 
Risk Management Compendium. 

China Smart and Secure Trade Lane Pilot (SSTL) 

During the recent period, the number of operators, SSTL ports and trade lanes has further 
increased and the pilot programme has been expanded to other transport modes under the 
current data exchange conditions.  In particular, the number of rail lanes between the EU 
and  China  has  expanded and  several  Member  States  have  in  addition  started  air  lanes. 
Two e-Commerce platforms have also joined the SSTL, thereby facilitating tackling high 
volume items. 

AEO Mutual Recognition 

The  Commission  has  continued  the  implementation  of  the  existing  mutual  recognition 
agreements  with  China,  Japan,  US,  Norway  and  Switzerland.  In  addition,  the 
Commission  has  engaged  in  negotiations  with  Canada  on  a  mutual  recognition 
agreement, and has undertaken preparatory steps with Singapore. 

Bilateral customs security agreements 

The Commission has made progress in negotiating amendments to the bilateral customs 
security  agreements  with  Switzerland  and  Norway  to  align  them  with  latest  changes  in 
EU law. The Commission has also worked intensively with Switzerland and Norway on 
their participation in the ICS2 system and on all related legal, operational processes for 
economic operators and contracting parties. 

3.  MONITORING SYSTEM 

In its Conclusions of January 2019, the Council invited the Commission to  develop,  in 
close cooperation with the Member States, a performance and monitoring framework to 
monitor the strategy’s implementation more systematically and robustly in the future. 

While the current strategy runs from 2014 to 2020, this monitoring framework needs to 
cover  its  successor.  Though  all  the  details  of  this  future  strategy  are  currently  in 
preparation, it is likely to address and follow up on many of the issues identified in the 
current strategy. The Commission has developed a draft monitoring framework (see the 

10 

 
Staff  Working  Document  accompanying  this  report),  but  some  operational  aspects  can 
only be defined when the new strategy is adopted.  

CONCLUSIONS 

This report and the accompanying Staff Working Document provide a picture of the state 
of implementation of the EU’s current customs risk management strategy and action plan 
as of end-2020. They show that significant progress has been made in the implementation 
of the Strategy and Action Plan since the publication of the previous report, both, by the 
Member States  and the Commission. Member States have used the strategy to  improve 
the  management  of  customs  risks  and  attribute  many  positive  achievements  to  it.  This 
includes  increased  awareness  of  risk  management  within  national  administrations  and 
galvanised support for making risk management a bigger priority. 

Despite  this  progress,  there  is  a  need  to  further  strengthen  procedures  and  obligations 
under  the  current  framework.  This  includes:  (i)  making  better  use  of  existing  data  to 
enable  more  and  better  risk  analysis;  (ii)  more  effective  procedures  to  deal  with  the 
increasing amount of goods arriving through e-commerce; (iii) clearer rules; (iv) a more 
stringent control response by Member States when risks have been identified at EU level 
and  communicated  to  Member  States;  (v)  more  systematic  cooperation  with  other 
authorities;  and  (vi)  better  monitoring  systems  for  AEOs.  At  the  same  time,  customs 
authorities need to provide proactive and innovative responses to address new challenges 
that jeopardise traditional customs risk management and control approaches 

Risk  analysis  remains  a  crucial  element  of  the  efficiency  of  customs  controls  enabling 
customs authorities to target controls in a situation where the growing volume and pace 
of trade necessitate an even more than ever selective and targeted approach.  

11