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CLECAT and the European Shippers’ Council issued a press release this week are warning Members of the European Parliament of the unforeseen consequences of the EU Customs Reform proposal. The associations representing the large majority of European businesses in transport and trade repeatedly express their support for the overall objectives of the reform but warn that the programme is incredibly ambitious, and that MEPs should not become subject of wishful thinking as the benefits of a central EU Data Hub may not materialise, especially for SMEs which do not have the means to become Trust and Check Traders (T&C).

The European Commission told the IMCO Committee of the EP last week that the Customs Reform aims to simplify and harmonise processes and ease the administrative burden for European Traders. An EU Customs Data Hub will be created and a new status for companies that offers enhanced customs facilitation called ‘Trust and Check.’ 

The Commission's premise is that direct, real-time access to the central database through traders' IT systems, self-release of goods, self-assessment of duty, and the new centralised layer for analysing customs and product-related data of incoming goods will speed up clearance processes, decrease bureaucracy, and increase compliance.

One of the key elements of the reform is based on the presumption that the majority of companies will opt for the new T&C status, allowing them to self-release goods after calculating customs duties themselves, without physically presenting them to Customs. T&C is an enhanced version of the current Authorised Economic Operator (AEO) status, a scheme slowly gaining global recognition. However, as it is subject to a rigorous authorisation process and requires substantial business infrastructure, it is today only moderately utilized by EU traders. According to the 2023 report of the European Court of Auditors, 18.210 AEO authorisations were in use in the EU´s Customs Territory in 2022.  This is a very small percentage of European companies involved in foreign trade.

In conclusion CLECAT and the ESC warn for unforeseen consequences of the reform.

•  the imposition of new obligations on customs representatives will likely lead to a decrease in their willingness to accept these responsibilities. These factors will slow down trade, as companies struggle to find the necessary resources and expertise.
  
  
•  If the only meaningful facilitations are limited to T&C status and only a minority of traders are able to obtain it, the whole system-based clearance concept becomes mute, as the majority of transactions remain transaction-based which could even slow down cargo flows at border crossing points for those benefiting from the new facilitations.
  
  
•  SMEs are the biggest potential losers of the reform, both on the logistics service provider side and on the trader side. Neither SME customs brokers nor SME importers are likely to be able to afford the infrastructure needed to accommodate the new requirements.

The full press release is available here.