jas forwarding (uk) limited uk projects oil & gas division · • 1965 the ipr simplified...

People Make The Difference

Jas Forwarding (UK) Limited – UK Projects – Oil & Gas Division


TRADE & CUSTOMS COMPLIANCE SUPPORT

FOR THE Oil & Gas SUPPLY CHAIN


Why is there a need in the UK for EU “Trade & Customs Compliance”….?

MRC


• In 1957 the “Continental Shelf” convention was held granting licensing for

UKCS sector national resource exploitation • 1964 the “UK Continental Shelf Act” was passed by Parliament

empowering HMRC to oversee trade compliance

• 1965 the IPR simplified “Continental Shelf” regime was established to attract and import the required technology for offshore exploration

• 1973 (44 years ago) UK joins the E.E.C. – European Economic Community

• 1992 (25 years ago) E.E.C Border controls removed and the Harmonised System was rolled out and implemented across all member states

• 2000 to 2002 Transition to SEU (Ship Work End Use) regulations were

established where today this is the present Regime…..! Public Notice 770 and now effective 18th July 2017, Notice 3001 covers this in more detail

• 1st May 2016 UCC “ Customs Blueprint” came into effect for all 28 member states and then 23rd June BREXIT….well…what next……!

• Potted fiscal history for UKCS Oil & Gas exploration:


And so we might say what next:

1st May 2016


CUSTOMS STATUS

In summary there are three types of customs status.

FCG – Free Circulation Status – Meaning UK or EU

manufactured goods or goods that duty has been paid on

in one of the 28 member states – hence “Free Circulation”

Preference Goods – Goods manufactured from EFTA

member states such as Norway where a purely origin

based “free trade agreement” is in place.

IPR / SEU – Ship Work End Use – Meaning goods where

EU duties and taxes have not been paid and they are

under the traders End Use Authorisation


• UCC / Union Customs Code became effective May 1st 2016

• The key objectives of this initiative are:

• To provide facilitation of legitimate trade across all 28 members states

• Reinforce the needs to ensure continued security & safety with-in the

EU

• Provide a paperless environment for customs & trade

• Achieve a harmonised & standardised application of customs controls

with AEO (Advanced Economic Operator) status taken up by traders


• What are the key impact items for the UK and in particular UKCS trade:

• The withdrawal of the SEU / RGR simplified manifesting procedure and to be

replaced with a formal electronic EDI data capture system to CHIEF (HMRC’s

UK import / export mainframe)

• Mitigation of “Fiscal Risk” by way of implementation of CCG’s

(Comprehensive Customs Guarantee’s) which are a move away from “Bill of

Demand” where previously no security was provided to HMRC

• Withdrawal of the monthly declaration undertaking and replaced with a

monthly BOD 2 (Bill of Discharge) thus creating more detailed audits on

traders where duty suspension regimes are active

• TORO – Addressing the “Transfers of Rights and Obligations”


• Withdrawal of the simplified manifesting system:

• The best area for guidelines on this major change are found in HMRC

information paper CIP 14 which was issued in April 2016

• In summary it provides the detail for three types of EDI import / export

controls by way of:

1. SDP ( Simplified Declaration Procedure) – aimed at non AEO operators

2. EIDR ( Entry in Declarants Records Procedure) –aimed at AEO operators

or those that meet the criteria for AEO

3. Full Import / Export Declaration Procedure – aimed at small volume or

new traders who do not have the cover of 1 or 2 above

• To obtain 1 or 2 above a C&E 48 needs to be submitted


• CCG – Comprehensive Customs Guarantee’s:

• Moving forward and now the “Bill of Demand” option has been removed,

for all SEU Authorisations, a trader will have to provide adequate assurity

to HMRC by way of a:

1. Bank bond,

2. Bank guarantee

3. Insurance bond or

4. Cash deposit

• Values for this are calculated on the anticipated financial risk HMRC deem

will be liable by the trader and in the main will cover duty but not VAT


• TORO – Transfer of Rights & Obligations

• As a result of this particular item, new requirements will be needed to

satisfy TORO rules which in summary are:

1. Transfer of the “rights” of SEU assets is acceptable

2. However - Transfer of the “obligations” are not permitted

• In item 2 above, obligation for audit trail remains with the importer or

supplier when SEU goods pass through the Supply Chain line


• TRANSITION PERIOD / GRACE PERIOD:

• As we now know, BREXIT has de-stabalised EU & HMRC Customs

protocol and clearly a state of confusion reigns

• Until such times as the UK can agree a way forward with the EU,

HMRC’s present stance is to carry on with implementation of UCC but

at the same time offer up a period of transition or grace period

• This is likely to see “trade carrying as usual” until the end of 2019

and provided every trader has lodged a C&E 48, this will provide some

cover as the new procedures and practices are fine tuned

• EU Intrastat scheduling will continue to apply as normal also


Using the right supply and purchasing Incoterms will help to mitigate your risk


Incoterms 2010 – make sure you have them clarified for

all import / export movements

People Make The Difference People Make The Difference

On Behalf of JAS Projects – Oil & Gas

Thank you!

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