Companies engaging in transporting non-Union goods need to provide surety against the possibility that import duties and value added tax might be charged. The amount of the guarantee amounts to 100% being equivalent to a reference amount of Customs duties liable over a set period. This can run into millions of Euro’s for companies frequently transporting non-Union goods.
A possibility does exist for drawing up a bank guarantee as security. Bank guarantees make a claim against available working capital. Bank charges are between 1% and 2% of the amount of the bank guarantee. All in all, it is well worthwhile striving diligently for the highest level of procedural controls on customs transit in order to be able to take advantage of the possibility of reducing the amount of this continuous guarantee.
Reducing surety
Customs law offers the possibility of reducing the guarantee against customs debts to 50%, 30% or 0%. In order to be eligible for a reduction, the permit holder should have, for example, a sound accounting system, an internal system of controls in place whereby mistakes and/or illegal or fraudulent transactions can be prevented, detected and rectified and should, amongst other things, be able to demonstrate that he/she has access to sufficient financial resources to meet his/her obligations. This is a substantial list of requirements and the essential elements in the areas of bookkeeping, creditworthiness, reliability and process control of transport must be met in order to be eligible for a reduction.
Read the full article in Cargo Magazine on page 54
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