Commission Delegated Regulation (EU) 2018/1063 was published on 30 July 2018, amending and correcting Delegated Regulation (EU) 2015/2446 supplementing the Union Customs Code (hereinafter “the Regulation”). The European Commission has also updated Annex A to the Exporter Consultative Guideline (hereinafter “the Guideline”) to clarify the level of flexibility for economic operators known as exporters from a customs perspective.
Exporter - new definition
The main change brought by the customs regulation refers to a more flexible definition of exporter in terms of the conditions for determining a legal person’s status as exporter from a customs perspective.
Under the old definition, the exporter had to meet one of the following conditions:
- Be established in the customs territory of the Union, holding a contract with a consignee in a third country, and having the power to determine that the goods are to be taken outside the customs territory of the Union, or
- in other cases, the person established in the customs territory of the Union with the power to determine that the goods are to be brought to a destination outside the customs territory of the Union.
The new definition provides that a legal person can qualify as an exporter if it fulfils one of the following conditions:
- It is established in the customs territory of the Union, with the power to determine and has determined that the goods are to be taken out of that customs territory, or
- if the above is not the case, the exporter can be any person established in the customs territory of the Union who is a party to the contract under which goods are to be taken out of that customs territory.
The new Regulation allows an exporter, from a customs perspective, to be appointed also by contractual arrangement between the parties. As such, the new provisions are highly relevant in terms of the distinction between an exporter from a customs perspective and the effective supplier of goods delivered outside the European Union, for which the VAT exemption is applicable.
In addition to the exporter definition, the other main changes include:
- When excisable products with Union goods status are exported, the external transit procedure could be applied. This provision will also facilitate the customs authorities’ supervision of the movement of excise goods between customs offices.
- If the customs authorities request information from the applicant prior to taking a decision and the applicant fails to provide it within 30 days, the decision-making process is no longer be deferred and the applicants lose the right to apply for a hearing with the customs authorities.
- In certain cases and with the applicant’s agreement, the timeframe for the customs authorities to take decisions on repayment or remission can be extended if it is not possible for them to do so by the original deadline. Such cases include additional time being required to verify the proof of preferential origin, the case being awaiting a Court of Justice of the European Union hearing, etc.
- The Regulation reintroduces the specific provisions regarding the mixed storage applicable for the end-use regime for the products classified in chapters 27 and 29 of the Combined Nomenclature (e.g. crude oils).
[Source: Official Journal No. 192/1 from 30.07.2018 - Commission Delegated Regulation (EU) 2018/1063 of 16 May 2018 amending and correcting Delegated Regulation (EU) 2015/2446 supplementing Regulation (EU) No. 952/2013 of the European Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs Code; Exporter Guideline published on Taxation and Customs Union European Commission https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/customs/customs_code/guidance_definition_exporter_en.pdf].
The Regulation introduces a new definition of exporter, making the conditions more flexible for determining the status as an exporter from a customs perspective. As the Guideline has an explanatory and illustrative nature, but is not legally binding, the customs authorities might adopt a different approach in practice.
There is a clear distinction from the customs perspective between an exporter / expeditor and a supplier performing deliveries of goods transported outside the territory of the European Union. As such, we recommend that companies involved in direct exports or parts of successive deliveries of goods analyse the customs and VAT implications so as to apply the correct VAT exemption and avoid delays in performing the customs operations. The PwC team can assist you for performing such analysis.