Sandra Strong reports on new developments in Customs & Excise legislation.

November 2013

Exports

New EU Combined Nomenclature for 2014 available

The EU Combined Nomenclature, ie the 8-digit commodity codes are reviewed annually. 2014 will see just 39 of the 6500 codes affected which included goods in Chapters 3, 20, 27, 31, 44, 70, 73, 76, 84 and 87. If your goods are classified within these Tariff Chapters you must obtain the 2013-2014 Correlation Table, available free on www.uktradeinfo.com.

Russia — measures affecting TIR movements

The Russian Federal Customs Service (FCS) announced on 13 September 2013 that the decision introducing a requirement for other guarantees for goods transported under cover of TIR Carnet will be applicable in the customs offices subordinate to the Siberian and Far Eastern regional customs administrations.

Russian customs originally scheduled their requests to claim additional guarantees for goods moved by road under cover of the TIR procedure, transport operators in August 2013 but the measures were temporarily postponed following the reaction from EU Member States.

The TIR procedure will continue to be performed at all other customs offices until 1 December 2013.

UK announces new OGEL

An Open General Export Licence (OGEL) for the Joint Strike Fighter project (JSF, also known as F-35 or Lightning II) is in the process of being drafted.

Expected middle of October 2013; not published and awaiting update.

New EU Counterfeit Goods Regulation

A new EU Regulation that will replace the Counterfeit Goods Regulation 1383/2003/EC forms part of a wider European intellectual property (IP) strategy. It will extend customs enforcement measures to a larger number of IPR rights than under the current regime and provide for the uncontested destruction of small consignments of goods. The new regulation provides the framework for the customs authorities of EU Member States to deal with infringing/counterfeit products passing through the relevant customs, either on the application of a right-holder or on discovery by customs authorities through routine inspections. Notably, however, the new regulation does not tackle the issue of suspected counterfeit goods that are purely in transit through the European Union.

Adopted October 2013.

Due 1 January 2014.

EU FTA with ASEAN

After the successful conclusion to the FTA between the EU and Singapore, the EU is continuing talks with other members of ASEAN. This is one of the larger EU agreements under negotiation and will progress slowly through the member countries. ASEAN are: Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam, Laos, Burma/Myanmar and Cambodia.

Final Agreement with Singapore in place September 2013.

Vietnam had the fifth round of talks in October 2013: could be resolved within 18 months.

Thailand: negotiations continue; next talks November 2013.

Malaysia: the negotiations were paused in 2012 due to a general election; hopefully they will restart in 2014, especially as Malaysia will lose GSP status in 2014.

USA ITAR amendments

The USA has been undergoing an Export Control Reform (ECR), removing some military items from the controls of the International Traffic in Arms Regulations (ITAR) to the simpler Export Administration Regulations (EAR). The amendments have been published, though more are expected, and the changes will come into force later this year. They include the introduction of a USA EAR 600 series code to indicate products’ military items not controlled under ITAR.

First amendments took effect 15 October 2013 — applies to USML VIII + XIX.

Second amendment to Brokering Rules took effect 25 October 2013.

Third amendment due 6 January 2014 — applies to USML VI, VII, XIII + XX.

Additional updates expected throughout 2014, eg to USML IV, V, IX, X, XI, XV + XVI

UK exports under OGELS/OIELS

All users of Open Individual Export Licences (OIELs), Open Individual Trade Control Licences (OITCLs), Open General Trade Control Licences (OGTCLs) and Open General Export Licences (OGELs) (with some exceptions) must make annual reports to the Export Control Organisation (ECO) of the Department for Business Innovation & Skills (UK-BIS) regarding their actual usage of these open licences.

Note: Does not apply to ALL OGELS.

First reporting period: 12 months from 1 January 2014.

First report due 1 January 2015

EU concludes trade deal with Georgia

The European Union and Georgia successfully concluded negotiations for a Deep and Comprehensive Free Trade Area (DCFTA) as part of the Association Agreement between them. The Association Agreement, together with the DCFTA, will provide for the close political association and economic integration of Georgia with the EU. The comprehensive FTA, negotiated in just 17 months and seven rounds, will see Georgia gaining better access to the EU market for its goods and services through EUR1 agreement rather than the GSP Scheme. This will boost access for Georgian goods to the EU market whilst also increasing consumer safety in Georgia.

Signed July 2013.

Update due February 2014.

Japan: new 24-hour pre-notification of cargo

A new system schedule for cargo destined for Japan will mean pre-notification to Japanese Customs 24 hours prior to loading, similar to the scheme introduced by the USA. This procedure is scheduled to go into force in March 2014, Japan Customs and Nippon Automated Cargo and Port Consolidated System (NACCS) are encouraging shippers to begin looking at requirements and working towards compliance now. Penalties include Do Not Loads (DNLs) and fines up to 500 thousand JPY.

The NACCS has provided several good resources for the trade to use in familiarising itself with the Japan 24-hour rule.

Scheduled for March 2014.

Extension to the ATA Carnet Scheme

Brazil made a major advance toward implementation of the ATA Carnet system in August 2013 by seeking proposals for a NGA (National Guaranteeing Association) for the Brazilian ATA Carnet system which should be selected by February 2014.

Indonesia, Bahrain, Saudi Arabia and Trinidad & Tobago are preparing to implement the ATA Carnet Scheme for temporary movements within 2014 under the so-called Istanbul Convention to facilitate customs administration in relation to temporary admissions on professional equipment and for demonstrations and exhibitions.

Expected within 2014.

Belarus-Kazakhstan — Russia Customs Union

Armenia and Kyrgyzstan are to join the Customs Union of Belarus, Kazakhstan and Russia: the accession proposal was approved in August 2013. The process to harmonise national legislation and regulatory framework with the Union’s standards has already started in these two countries. Ukraine, Moldova, Georgia and Azerbaijan are also being courted for membership. From this list, all but Azerbaijan are also in negotiation with the EU on Deep and Comprehensive Free Trade Agreements (DCFTA) with the EU. EU officials have made it clear that membership of the Customs Union is incompatible with the DCFTAs.

New members due Spring 2014.

Technical Regulations Russia/ Belarus/ Kazakhstan Customs Union

The scope of products that must conform to Technical Regulations (TRs) in the Customs Union of Russia, Belarus and Kazakhstan will be increased. This is an on-going programme until 2015.

Regulations on personal protection equipment (PPE), perfumery and cosmetics, packaging safety, products for children, toys and light industry products are affected. There are transition periods before the Technical Regulations become effective for:

  • PPE, toys, packaging and products intended for children and teenagers — Feb 2014

  • perfumery and cosmetic products and light industry products — July 2014.

New controls until 2014–2015.

EU lifts sanctions on Burma/Myanmar

In May 2013, the EU announced that it was temporarily suspending all sanctions measures on Myanmar/Burma with the exception of an arms embargo and controls on the supply of items that might be used for internal repression purposes. The intention is that on 30 April 2014, the EU will formally lift its sanctions regime on Myanmar, again with the exception of the arms embargo and internal repression controls. In the meantime, it will continue to monitor political developments in Myanmar and has stated that it will reinstate sanctions measures at short notice should it decide that the EU’s objectives in Myanmar are not being met.

Fully lifted 30 April 2014.

Saudi increase technical standards

Saudi Arabia is to increase compliance measures and possibly impose restricted on certain imports in order to stimulate domestic production and support the Saudi industry, eg water desalination equipment, all electrical goods with an operating voltage of 127V. Such electrical goods have been banned since May 2012 but spare parts for these products may be imported and sold until 9 November 2025. Electrical appliances with a dual voltage (127/220V) will be prohibited as of 28 February 2016.

Toys — new regulation effective from January 2015.

Increased measure until 2016.

Algeria delays implementation of FTA

Algeria has won a trade concession from the European Union, according to which the EU-Algeria free trade agreement should be fully phased-in by 2020, and not by 2017. The Algerian government has successfully asked for more time to fully lift tariff restrictions with the EU on imports of industrial products, under the new Free Trade Agreement (FTA) which entered into force on 1 September 1 2012.

Signed 1 Sept 2012: Full implementation by 2020.

Imports

Expiry of ADD

The Anti-Dumping Duties in place on certain iron or steel pipe fittings from South Korea and Malaysia expired October 2013. For further information see OJ C36/24.

Expired: 17 October 2013

National Duty Repayment Centre (UK-HMRC)

The UK NDRC is currently implementing a new database to process repayment applications for customs duty.

Delayed implementation.

Expected November 2013

VAT — 9% rate on certain goods and services

The Finance (No. 2) Act 2011 introduced a second reduced VAT rate of 9% to apply in respect of supplies of certain goods and services previously liable at the 13.5% rate for the period 1 July 2011 to 31 December 2013. This includes restaurant and catering services; hotel and holiday accommodation; admissions to cinemas, theatres, certain musical performances, museums and art gallery exhibitions; fairgrounds or amusement park services; the use of sporting facilities; hairdressing services; printed matter such as brochures, maps, programmes, leaflets, catalogues and newspapers. From 1 January 2014, the rate on these goods and services will revert to 13.5%.

Lower rate ends 31 December 2013.

Steel imports EU

From 1 January 2013 to 31 December 2013 imports into the EU of steel products originating in Kazakhstan will be subject to quantitative limits. The coverage of each quota category is indicated in the attached table. Import licences will be automatically issued subject to quota availability. Quota licence goods must be shipped from Kazakhstan by 31 December 2013. Shipment is considered to have taken place when the goods are loaded onto the exporting aircraft, vehicle or vessel. Quota utilisation data can be obtained at http://trade.ec.europa.eu/sigl/.

Effective until 31 December 2013.

EU GSP Scheme extended

The current GSP scheme is established by Council Regulation (EC) No. 732/2008, which entered into force on 1 January 2009 and was due to expire on 31 December 2011, has been extended until 31 December 2013. This is under the terms of a “roll-over” agreement which came into force in 2011 extending the existing scheme until December 2013.

Current scheme expires 31 December 2013.

New EU GSP Scheme starts 1 January 2014

Countries no longer eligible for GSP customs duty at import into the EU under the new agreement for any goods are: Argentina; Bahrain; Belarus; Brazil; Brunei Darussalam; Cuba; Gabon; Kazakhstan; Kuwait; Libya; Macao (SRA); Malaysia; Oman; Palau; Qatar; Russia; Saudi Arabia; UAE; Uruguay and Venezuela.

Countries losing GSP customs duty for some commodity codes at import into the EU from 1 January 2014 are as follows.

  • Costa Rica — all qualifying products covered by EU FTA from 1 October 2013.

  • Ecuador — losing GSP on goods within Chapters 6 and 16. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012.

  • China — losing GSP on goods within Chapters 1-5, 7-13, 17-23, 28-29, 31-46, 50-76, 78-79 and 81-96. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • India — losing GSP on goods within Chapters 25, 27, 28, 29, 31-38, 41, 50-60 and 87-89. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Indonesia — losing GSP on goods within Chapters 1-5, 15 and 31-38. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Nigeria — losing preference on goods within Chapter 41. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012.

  • Thailand — losing preference on goods within Chapters 16, 17 and 71. Full list in Annex V of EU Regulations reference L303/30 dated 31 October 2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Ukraine — losing preference on goods within Chapter 86. Full list in Annex V of EU Regulations reference L303/30 dated 31 October 2012.

New scheme starts 1 January 2014 for a rolling 10 years. Subject to review and changes as required.

EU GSP Amendments

Under Regulation 154/2013, the EU Commission agreed to remove Iran and Azerbaijan from the list of GSP beneficiary countries as from 22 February 2014.

Intrastat Reports — arrivals

The assimilation threshold for submitting Intrastat Reports to UK Customs on EU Arrivals will increase from £600,000pa to £1.2 million, so removing about 4000 businesses from the requirement to submit arrival Intrastat reports.

Change affective from 1 January 2014

New tariff suspensions due

A number of commodity codes will receive a suspension of EU customs duty from the 1 January 2014 in the normal six-monthly review of this duty waiver; some products currently covered by a tariff suspension will also lose this waiver from the same date. Check your tariff updates carefully.

Due 1 January 2014.

Next wave of EU Tariff Suspensions requests: deadline 24 February 2014 (for possible implementation 1 January 2015).

New implementation date: 1 July 2014.

Second wave of EU Tariff Suspensions requests: deadline 24 August 2014 (for possible implementation 1 July 2015)

C-TPAT extended to USA exporters

The Mutual Recognition Agreement (MRA) between the EU-USA safety and security programmes (AEO and C-TPAT) has a problem in that it is administered in the USA by the CBP, which has no authority over exporters. Therefore, the MRA is only one way and will remain so until the USA has extended C-TPAT approval to US exporting businesses. This was expected to take place as an Addendum to the current regulations from 2013 but has been delayed.

Expected — awaiting update.

Inward Processing relief (IP) drawback scheme going

Under the Union Customs Code (UCC) the number of customs procedures will be streamlined and the option of using Inward Processing (IP) drawback will be withdrawn. The UCC will not be fully in force until 2016 but IP drawback may be removed earlier. Currently, it is still possible to enter goods to IP drawback using a pre-approved authorisation until the drawback procedures are withdrawn. UCC will not come fully into force until May 2016.

Changes to PCC procedures

Under the UCC Processing under Customs Control (PCC) is expected to be withdrawn as a procedure. The main elements of the UCC have been postponed until 2016.

UCC enters into force 1 November 2013 but will not be adopted until May 2016.

Duty relief schemes require trader guarantees

The HMRC has stated that mandatory guarantees will be part of the Union Customs Code Implementing Provisions for certain Customs Procedures — Special Procedures (Inward Processing Relief (IPR), Outward Processing Relief (OPR), Customs Warehousing, Temporary Admissions and End Use), Temporary Storage and Transit.

There will be two forms of guarantees.

  1. Actual debts: It will be possible to gain a reduction from the (existing) normal rule that requires a full guarantee for established debts (typically those covered by deferment). This reduction, for which economic operators will need to hold AEO(c) status (AEO(s) status will not be sufficient) will be subject to authorisation. We do not know yet at what level the partial guarantee will be set: this will be set in the Commission Regulations.

  2. Potential debts: As expected, a mandatory full guarantee requirement will be introduced. Typically this will impact on temporary storage and special procedures. This guarantee requirement may be reduced or waived for authorised traders that meet the AEO(c) criteria.

The UCC will take effect on 1 May 2016, but guarantees may come into force earlier.

Customs warehouses of Type D or Type E using Type D arrangements

With the implementation of the modernised customs code type D, customs warehouses and those operating type E warehouses with type D arrangements will cease to exist. A type D customs warehouse is a private warehouse appropriate to traders who primarily import goods to free circulation. Removals to free circulation are made using Local Clearance Procedure using the rules of assessment established when the goods are declared to the warehousing procedure. The rules of assessment cover the nature, value and quantity of the goods. There is no provision in the modernised customs code for type D customs warehouses. If you are currently authorised as a type D customs warehouse or a type E customs warehouse using type D arrangements, you will need to consider your options; however, the delay with the implementing provisions of the Union Customs Code means that, potentially, there will be no changes until January 2016.

Expected January 2016.

GSP Preference Origin Rules

There will be significant changes to the structure of the Generalised System of Preference (GSP) rules in the EU. There is an intention to replace GSP Form A with statements of origin issued by registered exporters, called the Registered Exporter (REX) system. The statement of origin issued by the registered exporter can be inserted on a commercial document such as an invoice delivery note or packing list, which can be transmitted and stored electronically. A simple registration process will apply to UK companies that wish to export materials, components and parts to GSP beneficiary countries under the bilateral cumulation. The European Commission will maintain a central database of all exporters registered in GSP beneficiary countries to export under the GSP. This database of Registered Exporters will be available for consultation by the public via the internet, and UK companies importing under the GSP will be required to consult it prior to importation, to confirm the registration number of their supplier.

Expected 1 January 2017.

REX System to replace EUR1 Forms and invoice declaration

The Registered Exporter (REX) System will replace current proofs of preferential origin — GSP Forms A, EUR1 Certificates and Invoice Declarations (for exports from the EU under the bilateral cumulation arrangements) — with statements of origin issued by registered exporters on documents that can be transmitted and stored electronically. A database of Registered Exporters — the European Commission will maintain a central database of all exporters registered in the EU — it will be available for consultation by the public via the internet.

Effect of such change under discussion.

Potential due date: 1 January 2017.

General

EU UCC implementation

The recast Union Customs Code (UCC) has been agreed by the European Council and European Parliament. The European Council and European Parliament have examined the text and agreement has now been reached on what will be essentially the final text. This will affect all areas of import and export customs procedures and links to special regimes such as Inward Processing (IP) Relief, Warehousing with duty guarantee requirements. It will also bring into force special privileges for companies with AEO status.

25 October 2013: work programme started on drafting the Implementing Provisions.

Enactment of UCC: 1 November 2013.

Text of Implementing Provisions due January 2014, completed May 2015.

Implementation date 1 May 2016

New Member States EU

Turkey and EU reopened membership talks on 1 November 2013 after a three-year break. Other potential candidates are Iceland and Macedonia, with future candidate countries are Bosnia Herzegovina, Serbia, Albania, Montenegro, Armenia and Moldova.

Membership timescales: talks ongoing; updates February 2014.

UK National Clearance Hub moves

UK HMRC National Clearance Hub moves from Salford Quays to a new address:

National Clearance Hub, Ralli Quays, 3 Stanley St, Salford M60 9HL.

Moving date: 11 November 2013.

From 25 November 2013 there will be no staff based at the old Salford Quays address.

China–EU Trade Agreement

China and the EU will begin discussion in November 2013 to negotiation a Bilateral Investment Agreement.

Starting 21 November 2013.

New EU legislation resticting use of certain substances in pesticides

Amid growing concern across Europe about the collapse of bee populations, Regulation (EU) No. 485/2013 will ban the use and sale of seeds treated with products containing clothianidin, thiamethoxam and imidacloprid. These are neonicotinoids, chemicals that can be applied to the seeds of crops and which remain in the plant as it grows, killing insects that try to feed on it. Environmentalists have described them as the new DDT, claiming that the substances are as dangerous as that widely-banned pesticide.

Effective 1 December 2013.

WTO Bali Conference

The WTO will be meeting in Bali in December 2013 with the intention of reaching a conclusion to the Doha Agreement Round of Talks started in 2001. Topics being reviewed include an extension to commodities covered by the Information Technology Agreement (ITA), the use and removal of non-tariff barriers (NTBs) and the introduction of a Trade Facilitation Agreement (TFA). This is expected to be a very significant conference for anyone involved in international trade.

Conference date: 3 to 6 December 2013.

Minister of State for Trade and Investment

On 19 June 2013, The Queen approved the appointment of Ian Livingston as a Minister of State jointly at the Department for Business, Innovation and Skills and at the Foreign and Commonwealth Office as of December 2013 on the retirement from government of Lord Green of Hurstpierpoint. Effective December 2013.

France to increase

VAT rate France announced plans to increase its standard VAT rate from 19.6% to 20%. The EU has said it is not a big enough increase, so we await updates. In addition, the 7% reduced rate, relating to restaurants, construction and ebooks, will rise to 10%. The 5.5% VAT rate, which applies to food, hotels and entertaining, will fall to 5%. The measures will help fund a limited range of industry investment credits.

1 January 2014.

Cyprus to increase VAT rate

Cyprus has announced a two-stage increase to its standard VAT rate. It increased to 18% on 1 January 2013 and will increase by a further 1% on 1 January 2014. The reduced VAT rate will also increase in 2014 from 8% to 9%.

Stage 2: January 2014.

France — Finance Bill 2013

French Parliament has approved the Finance Bill for 2013, which contains important tax measures for both companies and individuals. This means, for the fiscal year ending as of 31 December 2012, companies liable for corporation tax may only deduct up to 85% of their financial expenses from their taxable income. For the fiscal years starting from 1 January 2014, companies may only deduct up to 75% of their net financial expenses. Only companies with net financial expenses exceeding €3 million are affected by this measure. This amount is a triggering threshold and not a deductible.

January 2014.

EU-Morocco Deep and Comprehensive Free Trade Area (DCFTA)

In April 2013, the EU and Morocco started the first round of negotiations for an EU-Morocco Deep and Comprehensive Free Trade Area (DCFTA). The objective is to upgrade the existing association agreement, which since 2000 has already guaranteed tariff-free trade for many products. Meeting in Rabat, negotiators will be starting talks on an agreement that is expected to deepen existing trade relations in a host of areas not yet covered, such as services and public procurement, as well as to bring better protection for investments and new commitments on competition and intellectual property rights. Morocco is the first of the four countries (Egypt, Jordan, Morocco and Tunisia) to come to the negotiating table to move the DCFTA forward.

Second round talks 1 July 2013.

Further updates December 2013.

EU-Ukraine Free Trade Agreement

The EU and Ukraine have agreed to complete the process of final technical revision of the agreement creating a free-trade area, within the broader framework of the association agreement initialled on 30 March 2012. The 160-page long association agreement and the 1100-page text on the economic and commercial chapter have gone for legal verification and translation, which could take several months, prior to the signing of the agreement by the council and the European Parliament, then ratification by member states.

Further updates December 2013.

EU-Canada Free Trade Agreement

Negotiations were launched in 2009 and good progress was initially made, though there are still difficulties especially in the area of agriculture. Comprehensive Economic and Trade Agreement (CETA) between EU and Canada was in its final stages December 2011 but a demand for a public debate in Canada which slowed things down. The EU wants to include financial services in the agreement.

Initial Agreement signed October 2013.

Implementation expected within 2014.

EU-Japan Free Trade Agreement

The EU has started discussions with Japan to set up a Free Trade Agreement between the two markets hopefully within 2013. The starting negotiations, among other things, agreed as follows.

  • To the mandate, which sets out a strict and clear parallelism between the elimination of our duties and non-tariff barriers in Japan. “Like for like”, if you will.

  • There is to be a safeguard clause to protect sensitive European sectors. The EU explicitly reserves the right to cancel the negotiations after one year if Japan does not live up to its commitments on removing non-tariff barriers.

Second round July 2013 concluded positively.

Key date April 2014.

EU-Mercosur Free Trade Agreement

Negotiations with Mercosur were officially relaunched at the EU-Mercosur summit in 2010 and dragged along through to 2012 when they came to a halt again. January 2013 the talks are expected to resume so that the agreement can be concluded in 2013. Mercosur members are: Argentina, Brazil, Paraguay and Uruguay.

Negotiations in progress — updates not expected until Spring 2014

EU-India Free Trade Agreement (FTA)

Talks are still continuing between the European Union and India on the FTA. It was hoped that negotiations will be finalised by the end of 2012 but this didn’t happen. The agreement, once complete, is expected to boost bilateral trade leading to increased international business expansion opportunities for both European and Indian companies. Indian General Election of 2014 is slowing down negotiations. Progress has been made in some areas, eg alcohol tariffs but concession on agriculture are causing issues.

Negotiations in progress don’t expect any updates until mid-2014.

EU-USA Free Trade Agreement

July 2013 saw the first talks begin on the much publicised Free Trade Agreement (FTA) — the Transatlantic Trade and Investment Partnership (TTIP) — between the European Union and the United States of America after two years of preparatory discussion. The deal is worth around £10 billion to the EU. Second round talks delayed due to industrial action in the USA. The TTIP will cover not only duty and tariff issues but also other trade regulations, services and Intellectual Property Rights.

Timescale: the aim currently is 18–24 months for completion (ie 2015).

AEO criterion on practical standards of competence or professional qualifications

New criterion has been announced relating to the practical standards of competence or professional qualifications relating to companies seeking AEO accreditation, which includes the Customs Simplification requirements. Staff directly related to this activity will either have to show that they hold a professional qualification granted by a body approved by HMRC or that they have a practical standard of competence, said to be a minimum of three years’ practical experience on customs matters. It will not apply to companies seeking safety and security AEO status only. Businesses seeking customs simplification or full AEO accreditation will need to meet the new criterion. Businesses that currently hold these AEO certificates under the existing legislation will need to show, within a transitional period of 24 months, that they meet the new criterion.

Expected 2014–2015 in UK.

New VAT Rules on Telecoms and Electronic Services

A new milestone has been announced in setting up a VAT “one-stop shop”. This will enable telecoms, broadcasting and e-services businesses to comply with all of their VAT obligations in all Member States from their country of registration. Among other things EU suppliers are no longer obliged to levy VAT when selling on markets outside the EU, thereby removing a significant competitive handicap. Previously under tax rules drawn up before, EU suppliers had to charge VAT when supplying digital products even in countries outside the EU and provides that VAT on telecommunications, radio and television broadcasting and electronic services supplied by a supplier established within the Community to non-taxable persons also established within the Community will be charged in the Member State where the customer belongs. The Commission has published practical guidelines to prepare businesses for the new VAT rules for telecoms and e-services, which will enter into force in 2015. The aim is to help businesses to be fully prepared on time for the changeover, whereby VAT will be charged where the customer is based, rather than where the seller is. The guidelines are available from HMRC website in English; they will be translated into other EU languages. For more information see the press release (IP/13/1004).

Effective 1 January 2015

Luxembourg to raise VAT rate

Luxembourg has announced that it plans to raise its standard VAT rate to help reduce is deficit. Currently, the VAT rate in Luxembourg is 15%, the lowest in the European Union. Whilst there is no confirmation of what the new rate will be, the government is adamant that it will remain the lowest in the EU. The rise will probably be to 16–18% based on previous discussions.

January 2015

New members expected to join the WTO

Seychelles concluded negotiations with the EU on becoming a member of the WTO in October. The EU will support Seychelles accession to the WTO, which is hoped will be concluded within 2014.

In an awareness creation forum for local journalists, the Ministry of Trade announced that Ethiopia will join the World Trade Organization (WTO) by 2015. Lesanework Zerfu, Head of the Multilateral Trade Relations Department of the Ministry told members of the press that Ethiopia's accession to WTO is expected to be finalized in the third quarter of 2015.

This is in accordance with the time frame set out in Growth and Transformation Plan (GTP). He emphasised that the negotiations so far were being conducted in a manner that safeguarded the national interest of Ethiopia. Currently 159 countries are fully fledged members of the global trading body while 34 others are on the accession track.

Expected January 2015.

Canada to remove tariff preferences from 72 countries

Following similar moves in the EU, Canada has announced that it will be restructuring its GSP Scheme, which currently gives preferential duty access to a large number of developing markets. They will be removing GSP benefits under the General Preferential Tariff from 72 current beneficiary countries, though this will still make it available to 103 countries. However, Canada intends to continue to review GPT eligibility biannually and to remove benefits for countries that:

  1. are classified for two consecutive years as high- or upper-middle income according to the last World Bank income classifications, or

  2. have a 1% or greater share of world exports for two consecutive years, according to the latest WTO statistics.

Effective 1 January 2015.

China to adopt VAT

A VAT pilot scheme has been running in China since 2012 as a means of replacing Business Tax (BT) for three specific industries: transportation, asset leasing and modern services section. The scheme was extended to other industries in August 2013 with the aim of China moving over to VAT completely by the end of 2015.

Fully introduced by end of 2015.

Arab Regional Free Trade Zone

It was announced early in 2013 at the Third Summit of Arab Economic and Social Development that there will be an Arab Regional Free Trade Zone in place by 2015.

Spring 2015

HS Codes for 2017

It is every five years that the Harmonised System of tariff classification codes (aka commodity codes) is re-issued. As soon as the HS 2012 was issued, the review of items to be included in the next amendment of the Harmonised System started. By November 2013 the amendments to be included in the HS 2017 will have been agreed for acceptance by the WCO Harmonised System Committee in March 2014. Then, the work will begin redrafting the current Schedule and reviewing amendments for the 2022 version. If you are interested, log on to www.wcoomd.org.

Revisions to HS2012 to be agreed March 2014.

Discussions on HS 2022 will begin January 2015.

HS2017 with amended codes due 1 January 2017.

November 2013

Exports

New EU Combined Nomenclature for 2014 available

The EU Combined Nomenclature, ie the 8-digit commodity codes are reviewed annually. 2014 will see just 39 of the 6500 codes affected which included goods in Chapters 3, 20, 27, 31, 44, 70, 73, 76, 84 and 87. If your goods are classified within these Tariff Chapters you must obtain the 2013-2014 Correlation Table, available free on www.uktradeinfo.com.

Russia — measures affecting TIR movements

The Russian Federal Customs Service (FCS) announced on 13 September 2013 that the decision introducing a requirement for other guarantees for goods transported under cover of TIR Carnet will be applicable in the customs offices subordinate to the Siberian and Far Eastern regional customs administrations.

Russian customs originally scheduled their requests to claim additional guarantees for goods moved by road under cover of the TIR procedure, transport operators in August 2013 but the measures were temporarily postponed following the reaction from EU Member States.

The TIR procedure will continue to be performed at all other customs offices until 1 December 2013.

UK announces new OGEL

An Open General Export Licence (OGEL) for the Joint Strike Fighter project (JSF, also known as F-35 or Lightning II) is in the process of being drafted.

Expected middle of October 2013; not published and awaiting update.

New EU Counterfeit Goods Regulation

A new EU Regulation that will replace the Counterfeit Goods Regulation 1383/2003/EC forms part of a wider European intellectual property (IP) strategy. It will extend customs enforcement measures to a larger number of IPR rights than under the current regime and provide for the uncontested destruction of small consignments of goods. The new regulation provides the framework for the customs authorities of EU Member States to deal with infringing/counterfeit products passing through the relevant customs, either on the application of a right-holder or on discovery by customs authorities through routine inspections. Notably, however, the new regulation does not tackle the issue of suspected counterfeit goods that are purely in transit through the European Union.

Adopted October 2013.

Due 1 January 2014.

EU FTA with ASEAN

After the successful conclusion to the FTA between the EU and Singapore, the EU is continuing talks with other members of ASEAN. This is one of the larger EU agreements under negotiation and will progress slowly through the member countries. ASEAN are: Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam, Laos, Burma/Myanmar and Cambodia.

Final Agreement with Singapore in place September 2013.

Vietnam had the fifth round of talks in October 2013: could be resolved within 18 months.

Thailand: negotiations continue; next talks November 2013.

Malaysia: the negotiations were paused in 2012 due to a general election; hopefully they will restart in 2014, especially as Malaysia will lose GSP status in 2014.

USA ITAR amendments

The USA has been undergoing an Export Control Reform (ECR), removing some military items from the controls of the International Traffic in Arms Regulations (ITAR) to the simpler Export Administration Regulations (EAR). The amendments have been published, though more are expected, and the changes will come into force later this year. They include the introduction of a USA EAR 600 series code to indicate products’ military items not controlled under ITAR.

First amendments took effect 15 October 2013 — applies to USML VIII + XIX.

Second amendment to Brokering Rules took effect 25 October 2013.

Third amendment due 6 January 2014 — applies to USML VI, VII, XIII + XX.

Additional updates expected throughout 2014, eg to USML IV, V, IX, X, XI, XV + XVI

UK exports under OGELS/OIELS

All users of Open Individual Export Licences (OIELs), Open Individual Trade Control Licences (OITCLs), Open General Trade Control Licences (OGTCLs) and Open General Export Licences (OGELs) (with some exceptions) must make annual reports to the Export Control Organisation (ECO) of the Department for Business Innovation & Skills (UK-BIS) regarding their actual usage of these open licences.

Note: Does not apply to ALL OGELS.

First reporting period: 12 months from 1 January 2014.

First report due 1 January 2015

EU concludes trade deal with Georgia

The European Union and Georgia successfully concluded negotiations for a Deep and Comprehensive Free Trade Area (DCFTA) as part of the Association Agreement between them. The Association Agreement, together with the DCFTA, will provide for the close political association and economic integration of Georgia with the EU. The comprehensive FTA, negotiated in just 17 months and seven rounds, will see Georgia gaining better access to the EU market for its goods and services through EUR1 agreement rather than the GSP Scheme. This will boost access for Georgian goods to the EU market whilst also increasing consumer safety in Georgia.

Signed July 2013.

Update due February 2014.

Japan: new 24-hour pre-notification of cargo

A new system schedule for cargo destined for Japan will mean pre-notification to Japanese Customs 24 hours prior to loading, similar to the scheme introduced by the USA. This procedure is scheduled to go into force in March 2014, Japan Customs and Nippon Automated Cargo and Port Consolidated System (NACCS) are encouraging shippers to begin looking at requirements and working towards compliance now. Penalties include Do Not Loads (DNLs) and fines up to 500 thousand JPY.

The NACCS has provided several good resources for the trade to use in familiarising itself with the Japan 24-hour rule.

Scheduled for March 2014.

Extension to the ATA Carnet Scheme

Brazil made a major advance toward implementation of the ATA Carnet system in August 2013 by seeking proposals for a NGA (National Guaranteeing Association) for the Brazilian ATA Carnet system which should be selected by February 2014.

Indonesia, Bahrain, Saudi Arabia and Trinidad & Tobago are preparing to implement the ATA Carnet Scheme for temporary movements within 2014 under the so-called Istanbul Convention to facilitate customs administration in relation to temporary admissions on professional equipment and for demonstrations and exhibitions.

Expected within 2014.

Belarus-Kazakhstan — Russia Customs Union

Armenia and Kyrgyzstan are to join the Customs Union of Belarus, Kazakhstan and Russia: the accession proposal was approved in August 2013. The process to harmonise national legislation and regulatory framework with the Union’s standards has already started in these two countries. Ukraine, Moldova, Georgia and Azerbaijan are also being courted for membership. From this list, all but Azerbaijan are also in negotiation with the EU on Deep and Comprehensive Free Trade Agreements (DCFTA) with the EU. EU officials have made it clear that membership of the Customs Union is incompatible with the DCFTAs.

New members due Spring 2014.

Technical Regulations Russia/ Belarus/ Kazakhstan Customs Union

The scope of products that must conform to Technical Regulations (TRs) in the Customs Union of Russia, Belarus and Kazakhstan will be increased. This is an on-going programme until 2015.

Regulations on personal protection equipment (PPE), perfumery and cosmetics, packaging safety, products for children, toys and light industry products are affected. There are transition periods before the Technical Regulations become effective for:

  • PPE, toys, packaging and products intended for children and teenagers — Feb 2014

  • perfumery and cosmetic products and light industry products — July 2014.

New controls until 2014–2015.

EU lifts sanctions on Burma/Myanmar

In May 2013, the EU announced that it was temporarily suspending all sanctions measures on Myanmar/Burma with the exception of an arms embargo and controls on the supply of items that might be used for internal repression purposes. The intention is that on 30 April 2014, the EU will formally lift its sanctions regime on Myanmar, again with the exception of the arms embargo and internal repression controls. In the meantime, it will continue to monitor political developments in Myanmar and has stated that it will reinstate sanctions measures at short notice should it decide that the EU’s objectives in Myanmar are not being met.

Fully lifted 30 April 2014.

Saudi increase technical standards

Saudi Arabia is to increase compliance measures and possibly impose restricted on certain imports in order to stimulate domestic production and support the Saudi industry, eg water desalination equipment, all electrical goods with an operating voltage of 127V. Such electrical goods have been banned since May 2012 but spare parts for these products may be imported and sold until 9 November 2025. Electrical appliances with a dual voltage (127/220V) will be prohibited as of 28 February 2016.

Toys — new regulation effective from January 2015.

Increased measure until 2016.

Algeria delays implementation of FTA

Algeria has won a trade concession from the European Union, according to which the EU-Algeria free trade agreement should be fully phased-in by 2020, and not by 2017. The Algerian government has successfully asked for more time to fully lift tariff restrictions with the EU on imports of industrial products, under the new Free Trade Agreement (FTA) which entered into force on 1 September 1 2012.

Signed 1 Sept 2012: Full implementation by 2020.

Imports

Expiry of ADD

The Anti-Dumping Duties in place on certain iron or steel pipe fittings from South Korea and Malaysia expired October 2013. For further information see OJ C36/24.

Expired: 17 October 2013

National Duty Repayment Centre (UK-HMRC)

The UK NDRC is currently implementing a new database to process repayment applications for customs duty.

Delayed implementation.

Expected November 2013

VAT — 9% rate on certain goods and services

The Finance (No. 2) Act 2011 introduced a second reduced VAT rate of 9% to apply in respect of supplies of certain goods and services previously liable at the 13.5% rate for the period 1 July 2011 to 31 December 2013. This includes restaurant and catering services; hotel and holiday accommodation; admissions to cinemas, theatres, certain musical performances, museums and art gallery exhibitions; fairgrounds or amusement park services; the use of sporting facilities; hairdressing services; printed matter such as brochures, maps, programmes, leaflets, catalogues and newspapers. From 1 January 2014, the rate on these goods and services will revert to 13.5%.

Lower rate ends 31 December 2013.

Steel imports EU

From 1 January 2013 to 31 December 2013 imports into the EU of steel products originating in Kazakhstan will be subject to quantitative limits. The coverage of each quota category is indicated in the attached table. Import licences will be automatically issued subject to quota availability. Quota licence goods must be shipped from Kazakhstan by 31 December 2013. Shipment is considered to have taken place when the goods are loaded onto the exporting aircraft, vehicle or vessel. Quota utilisation data can be obtained at http://trade.ec.europa.eu/sigl/.

Effective until 31 December 2013.

EU GSP Scheme extended

The current GSP scheme is established by Council Regulation (EC) No. 732/2008, which entered into force on 1 January 2009 and was due to expire on 31 December 2011, has been extended until 31 December 2013. This is under the terms of a “roll-over” agreement which came into force in 2011 extending the existing scheme until December 2013.

Current scheme expires 31 December 2013.

New EU GSP Scheme starts 1 January 2014

Countries no longer eligible for GSP customs duty at import into the EU under the new agreement for any goods are: Argentina; Bahrain; Belarus; Brazil; Brunei Darussalam; Cuba; Gabon; Kazakhstan; Kuwait; Libya; Macao (SRA); Malaysia; Oman; Palau; Qatar; Russia; Saudi Arabia; UAE; Uruguay and Venezuela.

Countries losing GSP customs duty for some commodity codes at import into the EU from 1 January 2014 are as follows.

  • Costa Rica — all qualifying products covered by EU FTA from 1 October 2013.

  • Ecuador — losing GSP on goods within Chapters 6 and 16. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012.

  • China — losing GSP on goods within Chapters 1-5, 7-13, 17-23, 28-29, 31-46, 50-76, 78-79 and 81-96. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • India — losing GSP on goods within Chapters 25, 27, 28, 29, 31-38, 41, 50-60 and 87-89. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Indonesia — losing GSP on goods within Chapters 1-5, 15 and 31-38. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Nigeria — losing preference on goods within Chapter 41. Full list in Annex V of EU Regulations reference L303/30 dated 31/10/2012.

  • Thailand — losing preference on goods within Chapters 16, 17 and 71. Full list in Annex V of EU Regulations reference L303/30 dated 31 October 2012. Also under surveillance so further GSP duty rates subject to removal within 2014-2016 (graduating out of the sheme).

  • Ukraine — losing preference on goods within Chapter 86. Full list in Annex V of EU Regulations reference L303/30 dated 31 October 2012.

New scheme starts 1 January 2014 for a rolling 10 years. Subject to review and changes as required.

EU GSP Amendments

Under Regulation 154/2013, the EU Commission agreed to remove Iran and Azerbaijan from the list of GSP beneficiary countries as from 22 February 2014.

Intrastat Reports — arrivals

The assimilation threshold for submitting Intrastat Reports to UK Customs on EU Arrivals will increase from £600,000pa to £1.2 million, so removing about 4000 businesses from the requirement to submit arrival Intrastat reports.

Change affective from 1 January 2014

New tariff suspensions due

A number of commodity codes will receive a suspension of EU customs duty from the 1 January 2014 in the normal six-monthly review of this duty waiver; some products currently covered by a tariff suspension will also lose this waiver from the same date. Check your tariff updates carefully.

Due 1 January 2014.

Next wave of EU Tariff Suspensions requests: deadline 24 February 2014 (for possible implementation 1 January 2015).

New implementation date: 1 July 2014.

Second wave of EU Tariff Suspensions requests: deadline 24 August 2014 (for possible implementation 1 July 2015)

C-TPAT extended to USA exporters

The Mutual Recognition Agreement (MRA) between the EU-USA safety and security programmes (AEO and C-TPAT) has a problem in that it is administered in the USA by the CBP, which has no authority over exporters. Therefore, the MRA is only one way and will remain so until the USA has extended C-TPAT approval to US exporting businesses. This was expected to take place as an Addendum to the current regulations from 2013 but has been delayed.

Expected — awaiting update.

Inward Processing relief (IP) drawback scheme going

Under the Union Customs Code (UCC) the number of customs procedures will be streamlined and the option of using Inward Processing (IP) drawback will be withdrawn. The UCC will not be fully in force until 2016 but IP drawback may be removed earlier. Currently, it is still possible to enter goods to IP drawback using a pre-approved authorisation until the drawback procedures are withdrawn. UCC will not come fully into force until May 2016.

Changes to PCC procedures

Under the UCC Processing under Customs Control (PCC) is expected to be withdrawn as a procedure. The main elements of the UCC have been postponed until 2016.

UCC enters into force 1 November 2013 but will not be adopted until May 2016.

Duty relief schemes require trader guarantees

The HMRC has stated that mandatory guarantees will be part of the Union Customs Code Implementing Provisions for certain Customs Procedures — Special Procedures (Inward Processing Relief (IPR), Outward Processing Relief (OPR), Customs Warehousing, Temporary Admissions and End Use), Temporary Storage and Transit.

There will be two forms of guarantees.

  1. Actual debts: It will be possible to gain a reduction from the (existing) normal rule that requires a full guarantee for established debts (typically those covered by deferment). This reduction, for which economic operators will need to hold AEO(c) status (AEO(s) status will not be sufficient) will be subject to authorisation. We do not know yet at what level the partial guarantee will be set: this will be set in the Commission Regulations.

  2. Potential debts: As expected, a mandatory full guarantee requirement will be introduced. Typically this will impact on temporary storage and special procedures. This guarantee requirement may be reduced or waived for authorised traders that meet the AEO(c) criteria.

The UCC will take effect on 1 May 2016, but guarantees may come into force earlier.

Customs warehouses of Type D or Type E using Type D arrangements

With the implementation of the modernised customs code type D, customs warehouses and those operating type E warehouses with type D arrangements will cease to exist. A type D customs warehouse is a private warehouse appropriate to traders who primarily import goods to free circulation. Removals to free circulation are made using Local Clearance Procedure using the rules of assessment established when the goods are declared to the warehousing procedure. The rules of assessment cover the nature, value and quantity of the goods. There is no provision in the modernised customs code for type D customs warehouses. If you are currently authorised as a type D customs warehouse or a type E customs warehouse using type D arrangements, you will need to consider your options; however, the delay with the implementing provisions of the Union Customs Code means that, potentially, there will be no changes until January 2016.

Expected January 2016.

GSP Preference Origin Rules

There will be significant changes to the structure of the Generalised System of Preference (GSP) rules in the EU. There is an intention to replace GSP Form A with statements of origin issued by registered exporters, called the Registered Exporter (REX) system. The statement of origin issued by the registered exporter can be inserted on a commercial document such as an invoice delivery note or packing list, which can be transmitted and stored electronically. A simple registration process will apply to UK companies that wish to export materials, components and parts to GSP beneficiary countries under the bilateral cumulation. The European Commission will maintain a central database of all exporters registered in GSP beneficiary countries to export under the GSP. This database of Registered Exporters will be available for consultation by the public via the internet, and UK companies importing under the GSP will be required to consult it prior to importation, to confirm the registration number of their supplier.

Expected 1 January 2017.

REX System to replace EUR1 Forms and invoice declaration

The Registered Exporter (REX) System will replace current proofs of preferential origin — GSP Forms A, EUR1 Certificates and Invoice Declarations (for exports from the EU under the bilateral cumulation arrangements) — with statements of origin issued by registered exporters on documents that can be transmitted and stored electronically. A database of Registered Exporters — the European Commission will maintain a central database of all exporters registered in the EU — it will be available for consultation by the public via the internet.

Effect of such change under discussion.

Potential due date: 1 January 2017.

General

EU UCC implementation

The recast Union Customs Code (UCC) has been agreed by the European Council and European Parliament. The European Council and European Parliament have examined the text and agreement has now been reached on what will be essentially the final text. This will affect all areas of import and export customs procedures and links to special regimes such as Inward Processing (IP) Relief, Warehousing with duty guarantee requirements. It will also bring into force special privileges for companies with AEO status.

25 October 2013: work programme started on drafting the Implementing Provisions.

Enactment of UCC: 1 November 2013.

Text of Implementing Provisions due January 2014, completed May 2015.

Implementation date 1 May 2016

New Member States EU

Turkey and EU reopened membership talks on 1 November 2013 after a three-year break. Other potential candidates are Iceland and Macedonia, with future candidate countries are Bosnia Herzegovina, Serbia, Albania, Montenegro, Armenia and Moldova.

Membership timescales: talks ongoing; updates February 2014.

UK National Clearance Hub moves

UK HMRC National Clearance Hub moves from Salford Quays to a new address:

National Clearance Hub, Ralli Quays, 3 Stanley St, Salford M60 9HL.

Moving date: 11 November 2013.

From 25 November 2013 there will be no staff based at the old Salford Quays address.

China–EU Trade Agreement

China and the EU will begin discussion in November 2013 to negotiation a Bilateral Investment Agreement.

Starting 21 November 2013.

New EU legislation resticting use of certain substances in pesticides

Amid growing concern across Europe about the collapse of bee populations, Regulation (EU) No. 485/2013 will ban the use and sale of seeds treated with products containing clothianidin, thiamethoxam and imidacloprid. These are neonicotinoids, chemicals that can be applied to the seeds of crops and which remain in the plant as it grows, killing insects that try to feed on it. Environmentalists have described them as the new DDT, claiming that the substances are as dangerous as that widely-banned pesticide.

Effective 1 December 2013.

WTO Bali Conference

The WTO will be meeting in Bali in December 2013 with the intention of reaching a conclusion to the Doha Agreement Round of Talks started in 2001. Topics being reviewed include an extension to commodities covered by the Information Technology Agreement (ITA), the use and removal of non-tariff barriers (NTBs) and the introduction of a Trade Facilitation Agreement (TFA). This is expected to be a very significant conference for anyone involved in international trade.

Conference date: 3 to 6 December 2013.

Minister of State for Trade and Investment

On 19 June 2013, The Queen approved the appointment of Ian Livingston as a Minister of State jointly at the Department for Business, Innovation and Skills and at the Foreign and Commonwealth Office as of December 2013 on the retirement from government of Lord Green of Hurstpierpoint. Effective December 2013.

France to increase

VAT rate France announced plans to increase its standard VAT rate from 19.6% to 20%. The EU has said it is not a big enough increase, so we await updates. In addition, the 7% reduced rate, relating to restaurants, construction and ebooks, will rise to 10%. The 5.5% VAT rate, which applies to food, hotels and entertaining, will fall to 5%. The measures will help fund a limited range of industry investment credits.

1 January 2014.

Cyprus to increase VAT rate

Cyprus has announced a two-stage increase to its standard VAT rate. It increased to 18% on 1 January 2013 and will increase by a further 1% on 1 January 2014. The reduced VAT rate will also increase in 2014 from 8% to 9%.

Stage 2: January 2014.

France — Finance Bill 2013

French Parliament has approved the Finance Bill for 2013, which contains important tax measures for both companies and individuals. This means, for the fiscal year ending as of 31 December 2012, companies liable for corporation tax may only deduct up to 85% of their financial expenses from their taxable income. For the fiscal years starting from 1 January 2014, companies may only deduct up to 75% of their net financial expenses. Only companies with net financial expenses exceeding €3 million are affected by this measure. This amount is a triggering threshold and not a deductible.

January 2014.

EU-Morocco Deep and Comprehensive Free Trade Area (DCFTA)

In April 2013, the EU and Morocco started the first round of negotiations for an EU-Morocco Deep and Comprehensive Free Trade Area (DCFTA). The objective is to upgrade the existing association agreement, which since 2000 has already guaranteed tariff-free trade for many products. Meeting in Rabat, negotiators will be starting talks on an agreement that is expected to deepen existing trade relations in a host of areas not yet covered, such as services and public procurement, as well as to bring better protection for investments and new commitments on competition and intellectual property rights. Morocco is the first of the four countries (Egypt, Jordan, Morocco and Tunisia) to come to the negotiating table to move the DCFTA forward.

Second round talks 1 July 2013.

Further updates December 2013.

EU-Ukraine Free Trade Agreement

The EU and Ukraine have agreed to complete the process of final technical revision of the agreement creating a free-trade area, within the broader framework of the association agreement initialled on 30 March 2012. The 160-page long association agreement and the 1100-page text on the economic and commercial chapter have gone for legal verification and translation, which could take several months, prior to the signing of the agreement by the council and the European Parliament, then ratification by member states.

Further updates December 2013.

EU-Canada Free Trade Agreement

Negotiations were launched in 2009 and good progress was initially made, though there are still difficulties especially in the area of agriculture. Comprehensive Economic and Trade Agreement (CETA) between EU and Canada was in its final stages December 2011 but a demand for a public debate in Canada which slowed things down. The EU wants to include financial services in the agreement.

Initial Agreement signed October 2013.

Implementation expected within 2014.

EU-Japan Free Trade Agreement

The EU has started discussions with Japan to set up a Free Trade Agreement between the two markets hopefully within 2013. The starting negotiations, among other things, agreed as follows.

  • To the mandate, which sets out a strict and clear parallelism between the elimination of our duties and non-tariff barriers in Japan. “Like for like”, if you will.

  • There is to be a safeguard clause to protect sensitive European sectors. The EU explicitly reserves the right to cancel the negotiations after one year if Japan does not live up to its commitments on removing non-tariff barriers.

Second round July 2013 concluded positively.

Key date April 2014.

EU-Mercosur Free Trade Agreement

Negotiations with Mercosur were officially relaunched at the EU-Mercosur summit in 2010 and dragged along through to 2012 when they came to a halt again. January 2013 the talks are expected to resume so that the agreement can be concluded in 2013. Mercosur members are: Argentina, Brazil, Paraguay and Uruguay.

Negotiations in progress — updates not expected until Spring 2014

EU-India Free Trade Agreement (FTA)

Talks are still continuing between the European Union and India on the FTA. It was hoped that negotiations will be finalised by the end of 2012 but this didn’t happen. The agreement, once complete, is expected to boost bilateral trade leading to increased international business expansion opportunities for both European and Indian companies. Indian General Election of 2014 is slowing down negotiations. Progress has been made in some areas, eg alcohol tariffs but concession on agriculture are causing issues.

Negotiations in progress don’t expect any updates until mid-2014.

EU-USA Free Trade Agreement

July 2013 saw the first talks begin on the much publicised Free Trade Agreement (FTA) — the Transatlantic Trade and Investment Partnership (TTIP) — between the European Union and the United States of America after two years of preparatory discussion. The deal is worth around £10 billion to the EU. Second round talks delayed due to industrial action in the USA. The TTIP will cover not only duty and tariff issues but also other trade regulations, services and Intellectual Property Rights.

Timescale: the aim currently is 18–24 months for completion (ie 2015).

AEO criterion on practical standards of competence or professional qualifications

New criterion has been announced relating to the practical standards of competence or professional qualifications relating to companies seeking AEO accreditation, which includes the Customs Simplification requirements. Staff directly related to this activity will either have to show that they hold a professional qualification granted by a body approved by HMRC or that they have a practical standard of competence, said to be a minimum of three years’ practical experience on customs matters. It will not apply to companies seeking safety and security AEO status only. Businesses seeking customs simplification or full AEO accreditation will need to meet the new criterion. Businesses that currently hold these AEO certificates under the existing legislation will need to show, within a transitional period of 24 months, that they meet the new criterion.

Expected 2014–2015 in UK.

New VAT Rules on Telecoms and Electronic Services

A new milestone has been announced in setting up a VAT “one-stop shop”. This will enable telecoms, broadcasting and e-services businesses to comply with all of their VAT obligations in all Member States from their country of registration. Among other things EU suppliers are no longer obliged to levy VAT when selling on markets outside the EU, thereby removing a significant competitive handicap. Previously under tax rules drawn up before, EU suppliers had to charge VAT when supplying digital products even in countries outside the EU and provides that VAT on telecommunications, radio and television broadcasting and electronic services supplied by a supplier established within the Community to non-taxable persons also established within the Community will be charged in the Member State where the customer belongs. The Commission has published practical guidelines to prepare businesses for the new VAT rules for telecoms and e-services, which will enter into force in 2015. The aim is to help businesses to be fully prepared on time for the changeover, whereby VAT will be charged where the customer is based, rather than where the seller is. The guidelines are available from HMRC website in English; they will be translated into other EU languages. For more information see the press release (IP/13/1004).

Effective 1 January 2015

Luxembourg to raise VAT rate

Luxembourg has announced that it plans to raise its standard VAT rate to help reduce is deficit. Currently, the VAT rate in Luxembourg is 15%, the lowest in the European Union. Whilst there is no confirmation of what the new rate will be, the government is adamant that it will remain the lowest in the EU. The rise will probably be to 16–18% based on previous discussions.

January 2015

New members expected to join the WTO

Seychelles concluded negotiations with the EU on becoming a member of the WTO in October. The EU will support Seychelles accession to the WTO, which is hoped will be concluded within 2014.

In an awareness creation forum for local journalists, the Ministry of Trade announced that Ethiopia will join the World Trade Organization (WTO) by 2015. Lesanework Zerfu, Head of the Multilateral Trade Relations Department of the Ministry told members of the press that Ethiopia's accession to WTO is expected to be finalized in the third quarter of 2015.

This is in accordance with the time frame set out in Growth and Transformation Plan (GTP). He emphasised that the negotiations so far were being conducted in a manner that safeguarded the national interest of Ethiopia. Currently 159 countries are fully fledged members of the global trading body while 34 others are on the accession track.

Expected January 2015.

Canada to remove tariff preferences from 72 countries

Following similar moves in the EU, Canada has announced that it will be restructuring its GSP Scheme, which currently gives preferential duty access to a large number of developing markets. They will be removing GSP benefits under the General Preferential Tariff from 72 current beneficiary countries, though this will still make it available to 103 countries. However, Canada intends to continue to review GPT eligibility biannually and to remove benefits for countries that:

  1. are classified for two consecutive years as high- or upper-middle income according to the last World Bank income classifications, or

  2. have a 1% or greater share of world exports for two consecutive years, according to the latest WTO statistics.

Effective 1 January 2015.

China to adopt VAT

A VAT pilot scheme has been running in China since 2012 as a means of replacing Business Tax (BT) for three specific industries: transportation, asset leasing and modern services section. The scheme was extended to other industries in August 2013 with the aim of China moving over to VAT completely by the end of 2015.

Fully introduced by end of 2015.

Arab Regional Free Trade Zone

It was announced early in 2013 at the Third Summit of Arab Economic and Social Development that there will be an Arab Regional Free Trade Zone in place by 2015.

Spring 2015

HS Codes for 2017

It is every five years that the Harmonised System of tariff classification codes (aka commodity codes) is re-issued. As soon as the HS 2012 was issued, the review of items to be included in the next amendment of the Harmonised System started. By November 2013 the amendments to be included in the HS 2017 will have been agreed for acceptance by the WCO Harmonised System Committee in March 2014. Then, the work will begin redrafting the current Schedule and reviewing amendments for the 2022 version. If you are interested, log on to www.wcoomd.org.

Revisions to HS2012 to be agreed March 2014.

Discussions on HS 2022 will begin January 2015.

HS2017 with amended codes due 1 January 2017.

August 2013

Exports

Croatia — EU membership

Croatia became a full member of the European Union on 1 July 2013. This means you may need to complete Intrastat returns if you import or export goods between the UK and Croatia and ensure that all your trade in goods between UK and Croatia is recorded in boxes 8 and 9 of your VAT return. Croatian VAT numbers have 11 characters, generally numbers (eg HR12345678901). You may need to provide additional information using a Supplementary Declaration for Intrastat.

Russia implements new GOST-TR (Technical Regulations)

The Russian Federation has increased the number of products that will fall under the Technical Requirements (TRs) under GOST-TR certification, as from 1 July 2013, and has announced other products to be added to the programme from 2015. The following TRs took effect on 1 July 2013:

  • seeds

  • fat and oil products

  • foodstuffs

  • food products labelling

  • certain types of specialised food, including dietary nutrition

  • fruit and vegetable juice products

  • food additives, flavouring agents and technological supplements.

Please note that the products not mentioned in the unified list may still be subject to mandatory conformity confirmation in accordance with the national legislation.

New address for UK Export Finance

UK Export Finance has relocated to new offices in Westminster:

UK Export Finance
Export Credits Guarantee Department
1 Horse Guards Road
London SW1A 2HQ
Tel: 020 7271 8000
Tel: 020 7271 8010 (customer services)
Fax: 020 7271 8001

Web: www.gov.uk/uk-export-finance

For the time being, staff email addresses will remain the same.

EU FTA with Singapore

On 16 December 2012, the Free Trade Agreement (FTA) between the EU and Singapore was agreed, with implementation expected in the second half of 2013. This is one of the agreements in the larger FTA currently under negotiation between the EU and the ASEAN countries (Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam, Laos, Burma/Myanmar and Cambodia). The draft agreement is being reviewed by legal teams from both sides, which aim to initial the draft text in the summer of 2013.

Negotiations on investment protection, which are based on a new EU competence under the Lisbon Treaty, will also continue in 2013.

EU FTA with Colombia and Peru

The EU has signed a Free Trade Agreement (FTA) with Colombia and Peru, which, it was said, “creates a stable framework to boost trade and investment between the EU and the Andean region”. The agreement, once fully implemented, will eliminate tariffs and relieve EU exporters of €270 million in duties annually. For example, it is worth over €33 million of tariff reductions for the automotive and car parts sector, around €16 million for chemicals and over €60 million for textiles.

Peru is in place already (from March 2013), and the Colombia Agreement has been ratified by some Member States. Other noticeable tariff reductions will be on pharmaceutical and telecommunication products. As soon as it is signed, the Agreement will be presented to the Congress of the Republic for approval and then submitted for constitutional review to be ratified by the President of the Republic. The internal approval process in Colombia may take up to two years. An update is due in September 2013.

Japan: new 24-hour pre-notification of cargo

Under a new system schedule for cargo destined for Japan, freight will have to be pre-notified to Japanese Customs 24-hours prior to loading, similar to the scheme introduced by the USA. This procedure is scheduled to go into force in March 2014. Japan Customs and Nippon Automated Cargo and Port Consolidated System (NACCS) are encouraging shippers to begin looking at requirements and working towards compliance now. Penalties include Do Not Loads (DNLs) and fines of up to 500,000 JPY.

NACCS has provided several good resources for the trade to use in familiarising themselves with the 24-hour rule.

Imports

Duty relief schemes require trader guarantees

The HMRC has stated that mandatory guarantees will be part of the Union Customs Code Implementing Provisions for certain Customs Procedures — Special Procedures (Inward Processing Relief (IPR), Outward Processing Relief (OPR), Customs Warehousing, Temporary Admissions and End Use), Temporary Storage and Transit.

There will be two forms of guarantees.

  1. Actual debts: It will be possible to gain a reduction from the (existing) normal rule that requires a full guarantee for established debts (typically those covered by deferment). This reduction, for which economic operators will need to hold AEO(c) status (AEO(s) status will not be sufficient) will be subject to authorisation. We do not know yet at what level the partial guarantee will be set: this will be set in the Commission Regulations.

  2. Potential debts: As expected, a mandatory full guarantee requirement will be introduced. Typically this will impact on temporary storage and special procedures. This guarantee requirement may be reduced or waived for authorised traders that meet the AEO(c) criteria.

The UCC will take effect on 1 May 2016, but guarantees may come into force earlier.

General

EU MCC/UCC implementation

The recast Union Customs Code (UCC) has been agreed by the European Council and European Parliament. They have examined the text, and agreement has now been reached on what will be essentially the final text. This will affect all areas of import and export customs procedures and links to special regimes such as Inward Processing (IP) Relief and warehousing with duty guarantee requirements. It will also bring into force special privileges for companies with AEO status. Enactment of the UCC is due by 1 November 2013. Negotiations are expected until autumn 2014. Implementation date is scheduled for 1 May 2016.

Minister of State for Trade and Investment

On 19 June 2013, the Queen approved the appointment of Ian Livingston, as of December 2013, as a Minister of State jointly at the Department for Business, Innovation and Skills and at the Foreign and Commonwealth Office, on the retirement from Government of Lord Green of Hurstpierpoint.

July 2013

Exports

EU FTA with Colombia and Peru

As soon as this agreement is signed, it will be presented to the Congress of the Republic for approval, and then submitted for constitutional review so it can be ratified by the President of the Republic. The internal approval process in Colombia may take up to two years.

UK Export Declarations

New requirements come into force for statistical value and update of certain export CPC Tariff notes. This relates to the completion of box 46 on SAD export/re-export declarations and amends the tariff CPC completion notes for CPC 10 00 042, 10 00 096, 10 00 097 and 10 00 098. For more information, see CIP(13)32. Due 14 July 2013.

Transparency in Export Licensing Controls: SPIRE

Work is in hand to make technical changes to SPIRE, and to the Reports and Statistics websites, and in preparing guidance for exporters. The Export Control Organisation (ECO) is working with a number of exporters to ensure that the system is user-friendly, along with internal testing of the system. In line with ECO normal practice, it will publish the data three months after the end of the quarter to which it relates. The first publication of this new data will, therefore, be in October.

UK exports under OGELS/OIELS

All users of Open Individual Export Licences (OIELs), Open Individual Trade Control Licences (OITCLs), Open General Trade Control Licences (OGTCLs) and Open General Export Licences (OGELs), with some exceptions, must make quarterly reports regarding their actual usage of these licences. This does not apply to all OGELS. Expected October 2013.

USA ITAR amendments

The USA has been undergoing an Export Control Reform (ECR) to remove some military items from the control of the International Traffic in Arms Regulations (ITAR) to the simpler Export Administration Regulations (EAR). The amendments have been published, although more are expected, and the changes will come into force later this year. They include the introduction of a USA EAR 600 series code to indicate military items not controlled under ITAR. Traders who have not started reviewing the update have until 15 October 2013.

EU lifts sanctions on Burma/Myanmar

In May 2013, the EU announced that it was temporarily suspending all sanctions on Myanmar/Burma, with the exception of an arms embargo and controls on the supply of items that might be used for internal repression purposes. The intention is that on 30 April 2014 the EU will formally lift its sanctions regime on Myanmar, again with the exception of the arms embargo and internal repression controls. In the meantime, the EU will continue to monitor political developments in the country and has stated that it will reinstate sanctions measures at short notice should it decide that the EU's objectives are not being met.

Imports

Additional duties on ceramic tableware

Council Implementing Regulation (EU) No. 412/2013 imposed a definitive anti-dumping duty, collecting the provisional duty imposed on imports of ceramic tableware and kitchenware originating in the People's Republic of China (PRC). The product scope is defined absolutely as ceramic tableware and kitchenware, excluding ceramic knives, ceramic condiment or spice mills and their ceramic grinding parts, ceramic peelers, ceramic knife sharpeners and cordierite ceramic pizza-stones of a kind used for baking pizza or bread, originating in the PRC, currently falling within CN codes ex 6911 10 00, ex 6912 00 10, ex 6912 00 30, ex 6912 00 50 and ex 6912 00 90. From companies in China, the ADD rate ranges from 13.1% to 36.1%. Effective from 13 May 2013.

Additional duties on steel tubes and pipes

Council Implementing Regulation (EU) No. 430/2013 imposed a definitive anti-dumping duty, collecting the provisional duty imposed on imports of threaded tube or pipe cast fittings, of malleable cast iron, originating in the People’s Republic of China and Thailand and terminating the proceeding with regard to Indonesia. The product concerned is defined absolutely as threaded tube or pipe cast fittings, of malleable cast iron, currently falling within CN code ex 7307 19 10, excluding bodies of compression fittings using ISO DIN 13 metric thread and malleable iron threaded circular junction boxes without a lid. From companies in China, the ADD rate ranges from 24.6% to 57.8% and from Thailand 14.9% to 15.5%. Effective from 13 May 2013.

Additional duties on polyethylene terephthalate

Council Implementing Regulation (EU) No. 465/2013 amending Regulation (EC) No. 192/2007 imposed a definitive anti-dumping duty on imports of certain polyethylene terephthalate originating in India, Indonesia, Malaysia, the Republic of Korea, Thailand and Taiwan. Effective from 16 May 2013.

Changes to Inward Processing Relief procedures

Two new customs procedure codes permit the airworthiness certificate scheme (free circulation) to be claimed upon release from Customs Warehousing. The new interactive C99 (Bill of Discharge) can be used by traders using Simplified Inward Processing. Effective from 1 June 2013.

New Tariff Suspensions due

A number of commodity codes will receive a suspension of EU customs duty from 1 July 2013 in the normal six-monthly review of this duty waiver; some products currently covered by a tariff suspension will also lose this waiver from the same date. Check your tariff updates carefully. Effective from 1 July 2013. The next wave of EU Tariff Suspensions will commence 1 January 2014.

General

EU-Morocco Deep and Comprehensive Free Trade Area

The first round of negotiations for an EU-Morocco Deep and Comprehensive Free Trade Area (DCFTA) took place in April. The objective is to upgrade the existing association agreement which, since 2000, has already guaranteed tariff-free trade for many products. It will cover new areas, such as services and public procurement, as well as bring better protection for investments and new commitments on competition and intellectual property rights. Morocco is the first of the four countries (Egypt, Jordan, Morocco and Tunisia) to come to the negotiating table to have moved the DCFTA forward. Further updates due in July 2013.

Slovenia to increase VAT rate

The Slovenian government has agreed a new austerity package, which included a 2% VAT rate rise on 1 July 2013 (up from the current rate of 20%, set in 2002). The reduced rate rose from 8.5% to 9.5%.

New Director-General of the WTO

From the nine candidates originally nominated by their respective governments for the post of World Trade Organization Director-General, to succeed Pascal Lamy, the position was awarded to Brazil’s Ambassador Roberto Carvalho de Azevedo on 8 May 2013. He will become the first Latin American leader in the organisation’s history. He will take over the position on 1 September 2013.

Luxembourg to raise VAT rate

Luxembourg has announced that it plans to raise its standard VAT rate to help reduce its deficit. Currently, the VAT rate is 15%, the lowest in the EU. While there is no confirmation of what the new rate will be, the government is adamant that it will remain the lowest in the EU. The rise will probably be to 16–18%, based on previous discussions. Due in January 2015.

June 2013

Exports

UK Military List amended

If you export goods covered by the UK Military List, you need to check how the amendments made in March 2013 (Export Control Regulations: military goods) affect your export of military goods, software and technology to ensure you take account of the revised control entries. The control entries affected are: ML2.c.; ML3.b.; ML6.b.1,2.& Note 3; ML7.i.2.c; ML8.a.33.& 34; ML8c.5. Note 2 & 3; ML8.f.3.; ML10 & Note; ML10a.& b.; ML10.d.& e.; ML10.f. & Technical Note; ML10.i.; ML13; ML13a. N.B; ML13.c. and ML13.d.,1.& 2.

Saudi Arabia increases technical standards

Saudi Arabia is to increase compliance measures and possibly impose restrictions on certain imports in order to stimulate domestic production and support Saudi industry, eg water desalination equipment and all electrical goods with an operating voltage of 127V. Such electrical goods have been banned since May 2012 but spare parts for these products may be imported and sold until 9 November 2025. Electrical appliances with a dual voltage (127/220V) will be prohibited as of 28 February 2016.

Imports

CHIEF Document code removed

The requirement to quote document code C634 — which identified the origin of textile goods on import entries — has been removed. This follows the change in October 2011, which meant EU importers of textile products no longer had to provide a non-preferential Certificate of Origin at the time of import. Applicable imports do not require this document code from April 2013, although it will still be accepted until October 2013 to give time for any software systems to be amendment. Effective now — code to be removed from CHIEF 1 October 2013.

Additional duties on USA-originating goods

EU importers of certain products will be required to pay an additional 26% customs duty into the EU from the USA from 1 May 2013. This measure goes back to 2002, when the World Trade Organization (WTO) ruled that the US practice of distributing funds raised from anti-dumping measures to the US complainants was illegal, and permitted the EU and eight other countries to impose retaliatory measures. Since 2005, a number of products manufactured in the USA have been subject to retaliatory measures in the form of additional customs duties, charged at import. The measures initially were applied to a wide range of products but, currently, measures have been dropped on all but three commodity codes. These have been subject to an additional 6% customs duty, which will rise to 26% on 1 May 2013. In addition, two further commodity codes have been added. This will affect the following commodity codes:

  • 07104000

  • 6204623110

  • 6204623190

  • 87051000

  • 9003190010.

Change to Customs Warehousing Temporary Removal Procedure

All warehousekeepers must be aware that a change to previously accepted procedures means that if you temporarily remove goods from the customs warehousing you must use Temporary Admission instead of the customs warehousing temporary removal arrangements.

For goods subject to certain activities and to existing conditions of your customs authorisation, alternative security arrangements for Temporary Admission goods (listed at Annex IX of Council Directive 2006/112/EC) may be required. This change also applies to anyone who is involved in the importation of works of art, collector items and antiques. Effective 30 June 2013.

Expiry of ADD

The Anti-Dumping Duties in place on certain iron or steel pipe fittings from South Korea and Malaysia are due to expire in October 2013. For further information see OJ C36/24.

Steel imports EU

From 1 January to 31 December 2013, imports into the EU of steel products originating in Kazakhstan will be subject to quantitative limits. Import licences will be automatically issued subject to quota availability. Quota licence goods must be shipped from Kazakhstan by 31 December 2013. Shipment is considered to have taken place when the goods are loaded onto the exporting aircraft, vehicle or vessel. Quota utilisation data can be obtained from the Europa website.

EU GSP amendments

Under Regulation 154/2013, the EU Commission agreed to remove Iran and Azerbaijan from the list of GSP beneficiary countries as from 22 February 2014.

General

Air Passenger Accounting Scheme

The Air Passenger Duty (APD) annual accounting scheme started to be introduced in the UK on 1 April 2013. APD has been levied since 1994 and is a duty of Excise on the carriage, from a UK airport, of chargeable passengers on chargeable aircraft. Notice 552, available on the HMRC website, gives guidance on this scheme.

EU MCC/UCC implementation

The new EU Customs Code is still due to come into force in July 2013, but the European Commission is discussing the official handling of this legislation in view of the fact that the Union Customs Code is the new preferred legislation to amend and update the Customs Procedures in place in the European Union. The official decision will not be available for about six weeks after the discussions in April, but the UCC discussions within the EU Commission/Council/Parliament saw some points emerging.

  • The 24 June 2013 deadline for enactment (when the current Customs Code is superseded by the Modernised Customs Code) is to be moved to 1 November 2013.

  • The implementation timetable is still emerging, although the January 2015 potential date is looking very tight — there is talk of slippage to 2016.

  • In addition to Customs Warehousing/I,P etc Guarantee Waivers being introduced for AEOs, discussions are now emerging about similar waivers for Deferment Account Guarantees — these are at a very early stage and may not result in change, but it appears Germany is supportive.

  • Although it was thought "First Sale" valuation was retained, this may now be back on the table for discussion.

The Final Regulation is to be published in June 2013. Enactment of MCC/UCC is due on 1 November 2013, and negotiations are expected until Autumn 2014.

EU–Morocco Deep and Comprehensive Free Trade Area

In April 2013, the EU and Morocco started the first round of negotiations for an EU–Morocco Deep and Comprehensive Free Trade Area (DCFTA). The objective is to upgrade the existing association agreement, which, since 2000, has already guaranteed tariff-free trade for many products. Meeting in Rabat, negotiators will be starting talks on an agreement that is expected to deepen existing trade relations in a host of areas not yet covered, such as services and public procurement, and to bring better protection for investments and new commitments on competition and intellectual property rights. Morocco is the first of the four countries (Egypt, Jordan, Morocco and Tunisia) to come to the negotiating table to move the DCFTA forward. Further updates are expected in July 2013.

May 2013

Exports

Export Control Regulations: military goods

Export Control (Amendment) Order 2013 (SI 2013 No. 428) came into force on 20 March 2013. This Order replaces schedule 2 to the Export Control Order 2008, which lists military goods, software and technology that are subject to export controls. The schedule has been amended in line with updates agreed during 2011 in the international export control regime known as the Wassenaar Arrangement and also consolidates previous amendments to schedule 2. Exporters should examine the new schedule carefully to check whether any of their goods, software or technology are affected by changes to definitions and control list entries.

Transparency in Export Licensing Controls: SPIRE

Work is in hand to make technical changes to SPIRE and to the Reports and Statistics websites, and in preparing guidance for exporters. The Export Control Organisation (ECO) is working with a number of exporters to ensure that the system is user-friendly along with internal (ECO) testing of the system. They intended to have completed the changes to SPIRE during April 2013, which is when exporters were able to begin uploading data. In line with ECO normal practice, they will publish the data three months after the end of the quarter to which it relates — the first publication of this new data will, therefore, be in October 2013.

Imports

Intrastat Reports — arrivals

There are big changes expected within the European Statistics arena that mainly concern intra-EU trade in goods statistics. HM Revenue and Customs (HMRC) is asking for traders to take part in a consultation in 2013 to assess the impact of changes to collecting statistics on EU movements, in particular arrivals. The aim is to increase the assimilation threshold from £600,000 pa to £1.2 million — which will remove about 4000 businesses from the requirement to submit arrival Intrastat reports. The report is due to be published in June 2013, with changes expected to take effect from January 2014.

General

EU Late Payment Regulations

The EU Late Payment Regulations came into force on 15 March 2011 but each country had until 16 March 2013 to implement its provisions, at which point the old directive was officially repealed. It is also worth noting that it is at each country's discretion whether contracts concluded prior to 16 March 2013 are covered by the new rules.

EU–Singapore Free Trade Agreement

On 16 December 2012, the free trade agreement (FTA) between the EU and Singapore was agreed, with implementation expected by the second half of 2013. This is one of the agreements in the larger FTA between EU and the ASEAN countries under negotiation (Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam, Laos, Burma/Myanmar and Cambodia). The Draft Agreement is expected May 2013.

EU–Ukraine Free Trade Agreement

The EU and Ukraine have agreed to complete the process of final technical revision of the agreement creating a free trade area, within the broader framework of the association agreement initialled on 30 March 2012. The 160-page association agreement and the 1100-page text on the economic and commercial chapter have gone for legal verification and translation — which could take several months — prior to the signing of the agreement by the council and the European Parliament, then ratification by Member States.

EU–Canada Free Trade Agreement

Negotiations were launched in 2009 and good progress has been made, though there are still difficulties, especially in the area of agriculture. The Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada was in its final stages as of December 2011 but there was a demand for a public debate in Canada, which slowed things down. It is still on the agenda for 2013.

Trade in services

In February 2013, the European Commission proposed to open multilateral trade negotiations on services. To begin with, 21 World Trade Organization (WTO) Members will be at the negotiating table, but the EU is keen to encourage others to join. The EU is also pushing for the agreement to dovetail with WTO rules so it can be later folded into the WTO system. Negotiations were expected to start in spring 2013.

Air passenger accounting scheme

An Air Passenger Duty (APD) annual accounting scheme has been introduced in the UK from 1 April 2013. APD has been levied since 1994 and is a duty of excise on the carriage, from a UK airport, of chargeable passengers on chargeable aircraft. Notice 552, available on the HMRC website, gives guidance on this air passenger annual accounting scheme.

New WTO member

The WTO has welcomed progress in the accession procedures for Tajikistan. Ratification is due 7 June 2013.

New EU Member States

Potential candidates are Iceland, Turkey (who opened accession talks in 2005) and Macedonia. Future candidate countries are Bosnia Herzegovina, Serbia, Albania, Montenegro, Armenia and Moldova.

Last reviewed 21 November 2013