The new EU customs risk management initiative was put out for consultation on October 5, 2021 and is expected to be adopted by the Commission in the first quarter of 2022.
This is one of the fastest initiatives given the time between the consultation process and the expected adoption date. There are several reasons for this speed. First, everyone is aware that due to the recent migration crisis, Brexit, and trade wars, customs, border, or tax-related topics are at the forefront, even overshadowing military events such as those in Ethiopia, Syria, Yemen, and Eastern Ukraine. What is this initiative about? First of all, it is a direct consequence of the Customs Union Action Plan adopted on September 28 (link below*), which aims to achieve a more coherent and stronger Customs Union. As we read on, we begin to understand the rush behind the rapid adoption of this text: “Following the need to finance the Covid-19 crisis exit measures, the full collection of customs duties and taxes is more important than ever”. Indeed, all tariffs are redirected to the EU budget and could be a way to finance the EU’s 400 billion Covid-19 recovery plan. The need for improvement in this area has been highlighted by numerous reports such as COM(2021)9, COM(2018)549, COM(2016)476. Between the lines: This initiative aims to further harmonize customs procedures in each member state of the customs union, but also to ensure that every tax due is correctly collected.
In order to do this, the EU’s 2014 plan for customs risk management must be adapted. What will change in concrete terms? First, get ready to revise your Union Customs Code, as changes are clearly planned: “Adaptations and amendments to the Union Customs Code will be identified.” Secondly, the pressure on duty collection will increase: “Adopt a low-risk approach where no undeclared or misdeclared goods with financial risks for the EU will cross the border undetected”. The crisis of last spring had a considerable impact on national and European budgets. Let’s be clear, the EU relies on the collection of taxes and duties to fill this hole in the budget. Harmonization aims at streamlining procedures and ensuring an equal level of control in all member states in order to avoid “customs tourism” consisting in declaring imported goods in the most “convenient” country. Summary: Now more than ever, always ensure that your declaration contains accurate data, including customs classification, origin and value!