UK–EU Trade: Documentation, Origin & Risk
What are the key customs documents required in order to utilize the trade agreement tariffs between the UK and the EU when conducting cross-border trade between the UK and Sweden?
The main documents required are Statement on Origin, Bill of Materials (BoM) and long-term vendor/supplier declaration verifying the content specified in the BoM. However, if the Customs authority conducts a review of a product’s country of origin, the importer may add any information that it considers relevant for the purpose of the review. Therefore, it is important to keep any and all relevant documents that can verify the origin of the goods.
What are the potential risks if the correct customs origin documentation and supporting evidence are lacking or deemed insufficient by Customs?
When goods are claimed to have a specific preferential origin, customs authorities in the importing country shall be able to verify the claim. To do this, traders need to provide proof of origin. If the customs authority starts an investigation to verify the origin of the product, then the Customs authority may deny preferential tariff treatments within certain time periods (usually within 3 years, in accordance with article 103 of the Union Customs Code (EU) no. 952/2013).
Some (non-exhaustive) examples of when the Customs authority can deny preferential tariff treatments:
If the importer does not provide a reply to the questions of the investigation
When a statement on origin cannot be provided for a claim for preferential treatment that is based on a statement of origin
If the importer’s knowledge is inadequate to confirm the origin of the product, for a claim for preferential tariff treatment, when the claim is based on the importer’s knowledge, i.e. the information the importer holds on the preferential origin of the goods he imports.
The Customs Authority may also suspend the granting of preferential tariff treatment while waiting for the results of the verification. In such cases the goods can be released if the importer agrees to precautionary measures, including guarantees.
What important mitigation measures must clients involved in cross-border trade of commodities between the UK and Sweden implement to reduce risks related to origin management and origin solicitation?
It is always important to keep all relevant documentations and information. This would help the importer in a scenario when the Customs authority questions the origin of the imported products and the documentation supporting the origin of the imported products. It is also always important to have the correct supporting documentation regarding the imported products fulfillment of origin criteria. This information should always be included in the BoM and in the long-term vendor/supplier declaration as supporting document to Statement of origin.
The Experts
Partner, Indirect Tax, Nordic Tax & Law Sustainability Leader
EY
Indirect Tax – Global Trade Manager EY Sverige
EY