TT Talk - European Union Customs changes

The European Union's Import Control System 2 (ICS2), a cornerstone of customs security and safety, is poised for its third release on 3 June 2024. This evolution brings significant changes and enhancements, geared towards augmenting efficiency, optimising risk management, and bolstering the protection of EU citizens and the internal market.

There are some pivotal transformations that Release 3 of ICS2 bring. Expanded coverage, standardised data elements, advance loading information, enhanced risk assessments, and streamlined communication collectively contribute to a more robust and effective import control framework. Economic operators are strongly advised to familiarise themselves with these alterations and initiate preparations to ensure smooth compliance.

Expanded scope and harmonised data elements

The expanded scope of this forthcoming release, encompassing maritime, inland waterway transport, road and rail freight carriers, marks a significant shift for Economic Operators (EOs) operating within the European Union. Maritime and inland waterway transport operators will now be required to submit Entry Summary Declarations (ENS) to ICS2, aligning their procedures with those already established for air cargo carriers. E-commerce businesses, including postal operators and express carriers, will also fall under the ICS2 umbrella, ensuring that a wider range of goods entering the EU is subject to enhanced scrutiny.

To accommodate this broader coverage, Release 3 introduces harmonised data elements for all modes of transport. This standardisation streamlines the declaration process for EOs, eliminating inconsistencies and simplifying data submission. The enhanced granularity of the data elements provides customs authorities with a more comprehensive picture of incoming goods, enabling more precise risk assessments and targeted interventions.

Shippers should refer to the Combined Nomenclature (CN), which is a tool for classifying goods. Shippers should note that the notification requirements under ICS2 are more exacting than previously. Goods are expected to be declared precisely in line with CN requirements. For example, it is no longer acceptable to use a description such as ‘Agricultural products’. A more precise description such as ‘Oranges’, ‘Fish’ or ‘Rice’ must be used instead. A list of examples is available on the EU’s Customs and Taxation website.

It is important to note that, as declarants, carriers are legally responsible for the data provided under the new system. They will be responsible for providing the HS commodity (with reference to CN), the EORI of the consignee established in the EU, as well as information about the buyer and seller of the goods.

It is important to note that, as declarants, carriers are legally responsible for the data provided under the new system.

Streamlined communication and workflow

The new release introduces a centralised platform called the Common Repository (CR) that will facilitate and streamline communication and data exchange between EOs, customs authorities and other stakeholders. This centralised approach aims to simplify interactions, reduce administrative burdens, and expedite customs clearance procedures. Electronic data submission and standardised data formats eliminate the need for paper-based documentation and manual data entry.

EOs can leverage this streamlined communication platform to address potential issues proactively and ensure seamless customs clearance. By engaging in timely and transparent communication with customs authorities, EOs can minimise delays and disruptions to their supply chains.

Additionally, the CR facilitates multiple filing. This is where the ENS is split into different parts, allowing multiple parties to file information to the repository, where all the various partial filings are linked. As an example of how this might work, a freight forwarder could choose to file the data for which they are responsible, removing the need to coordinate between disparate parties who will be responsible for filing the combined data.

Proactive adaptation and opportunities

The expansion of ICS2 coverage under Release 3 brings a heightened responsibility for supply chain operators. Maritime and inland waterway carriers, as well as road and rail carriers, who were previously exempt from ICS2 requirements, now find themselves within the system's scope. This necessitates prompt adaptation to meet the new filing obligations and ensure compliance.

Supply chain operators should invest in technology and data management systems that can efficiently handle the increased data requirements of ICS2. Automation tools are able to streamline data collection, validation, and submission processes, ensuring accuracy and reducing manual workload.

Further collaboration with logistics partners and freight forwarders will prove crucial for timely access to the necessary information for ENS declarations and it seems likely that the introduction of Release 3 will deepen relationships between partners.

The expansion of ICS2 coverage under Release 3 brings a heightened responsibility for supply chain operators.

Embracing the change

The introduction of a centralised communication platform offers an opportunity for both supply chain and transport operators to enhance their interaction with customs authorities. By actively utilising this platform for data submission, status updates and inquiries, operators can streamline procedures and foster transparency.

Proactive engagement with customs officials through the CR platform can enable early identification and resolution of potential issues. This can significantly contribute to reducing delays, minimising the risk of penalties, and maintaining smooth supply chain operations.

Economic operators, as well as supply chain and transport operators, should embrace proactive adaptation and collaboration to respond to the changes in ICS2 Release 3 effectively. Investments in technology, streamlined data management, and strong partnerships with supply chain players are key to ensuring compliance and maintaining efficient operations in the face of heightened customs scrutiny. By adopting a strategic approach, operators can leverage these changes to strengthen their supply chain resilience and optimise customs clearance procedures.

Economic operators, as well as supply chain and transport operators, should embrace proactive adaptation and collaboration

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If you would like further information, or have any comments, please email us, or take this opportunity to forward to any others who you may feel would be interested.

Josh Finch

TT Club

Date06/02/2024