ANNUAL REVIEW

Trade & Customs 2015

September 2015  |  RISK MANAGEMENT

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Complying with today’s increasingly complex trade and customs environment while maximising global opportunities is the overriding challenge for companies engaging in cross-border business. Multinational corporations looking to establish and maintain multijurisdictional operations must contend with a host of demanding requirements, including regulatory compliance, dispute handling, export issues, end-to-end supply chain risks and the impact of new technologies.

 

UNITED STATES

Michael Cone

FisherBroyles

“One of the larger developments is the internal reorganisation of US Customs and Border Protection (CPB) whereby trade facilitating activities are now being performed in 10 ‘Centres of Excellence and Expertise’ (CEE) located in different cities around the US. Functionally, the CEE an importer is assigned to will be its CBP point of contact for all its shipments, regardless of the particular port in which the goods arrive. The CEEs will perform all validation activities, review administrative protests and deal with post-entry amendments. Although participation in the programme is currently voluntary and open only to participants in the supply chain security programme entitled ‘Customs - Trade Partnership Against Terrorism’ (C-TPAT), the CEE platform is clearly going to be the future basis of the importing trade’s relationship with CBP.”

 

BRAZIL

Vera Kanas

TozziniFreire Advogados

“Brazil is seeking to reduce customs costs and bureaucracy and to increase transparency through the implementation of a series of measures. In the scope of the implementation of the WTO Agreement on Trade Facilitation, Brazil is creating the single window program, which will allow all proceedings relating to import and export operations, including licences granted by different governmental agencies, to be concentrated in a single electronic process. Brazil is also implementing the Authorised Economic Operator Program (AEO), which will replace the Blue Line program. The AEO will benefit certified companies with faster and more simplified customs clearance. As a second step of the program, Brazil will seek mutual recognition with other countries that have already implemented the AEO, allowing certified Brazilian companies to profit from this simplified procedure also in their exports to foreign markets.”

 

ARGENTINA

Patricia Lopez Aufranc

Marval O’Farrell & Mairal

“In 2012, the Argentine government introduced an Import Prior Sworn Statement requirement, applicable to almost all imports of goods, referred to as ‘DJAI’. Importers must submit a DJAI electronically, prior to issuing a purchase order, production order or similar document used for documenting transactions abroad. The information included in the DJAI is available to all agencies of the government which have adhered to the DJAI system, and those agencies will be able to raise objections to the import. In the case of objections, the importer must resolve the objections directly with the relevant agencies. Once approved, the importer will be able to make the import under an approved DJAI within 180 days from the DJAI’s filing, although this term may be extended. The DJAI system actually works as a prior approval system, since the purchase order cannot be placed until the DJAI is approved by the relevant agencies. The approval rate of the Import Prior Sworn Statements varies over time, since their approval is discretional. In 2014, within the World Trade Organisation (WTO) dispute settlement procedure, the panel ‘Argentina – Measures Affecting the Importation of Goods’, issued its report regarding the DJAI procedure, the import licensing requirements and the restrictive trade-related requirements imposed by Argentina.”

 

UNITED KINGDOM

Daniel Martin

Holman Fenwick Willan LLP

“International trade sanctions continue to dominate the agenda of politicians, enforcement agencies and compliance officers. There is a real focus on Iran, with people looking closely at what is and is not permitted as we wait to see what happens next, particularly whether the US Congress will approve the deal in Iran, and how quickly and fully Iran will perform its obligations. With no comprehensive sanctions relief yet in place, the authorities have made clear that they will continue to enforce the existing sanctions. On the customs side, issues associated with e-commerce and fulfilment houses are a high priority.”

 

BELGIUM

Eva Monard

Jones Day

“While in previous months, the economic sanctions imposed on Russia, and the attention paid to these by the press was a ‘hot topic’, the recently concluded nuclear agreement between Iran, the P5+1 – China, France, Russia, UK, US and Germany – and the European Union, is presently the talk of the day. It is, however, important to be aware of the fact that the sanctions against Iran currently still remain in place, and are likely to be so for the foreseeable future. Companies should therefore continue to be diligent with any dealings with Iran.”

 

RUSSIA

Wilhelmina Shavshina

DLA Piper

“There are a number of recent trends in customs practices in Russia which should be underlined. We have seen the implementation of electronic declaration of goods, a shifting emphasis to control after release of goods, and application of the Risk Management System in the course of customs control, which includes categorisation based on the application of a foreign trade participant – for example, holders of industrial assembly agreements – and automatic categorisation. The implementation of ‘remote release’ technology has been a further feature, as has expanding the use of the Authorised Economic Operator (AEO) status, which allows companies to be related to the group with the lowest risk of committing customs offences. Companies should keep in mind that the customs authorities consider collection of the greatest possible amount of customs payments as essential part of their activity.”

 

INDIA

T. Viswanathan

Lakshmikumaran & Sridharan

“The authorities have been expending their time and energy on issues relating to the classification of imported goods, as per the Customs Tariff of India, which is based on the World Customs Organisation’s Harmonised System. Often, disputes of classification are also linked with exemptions availed by importers from payment of duties of customs granted by notifications issued by concerned government departments. Usually, the authorities claim that importers have not correctly classified the goods, or have provided incorrect particulars while filing Bills of Entry. Recently, the department has been focusing on imports from India’s Free Trade Agreement partner countries. The authorities have also been implicating customs brokers in many of the scenarios mentioned above, as aiders and abettors. This used to be a rare occurrence but now customs brokers are being extra cautious so that their licences are not suspended.”

 

SOUTH AFRICA

Meluleki Nzimande

Webber Wentzel

“Earlier this year, the US renewed the Africa Growth Opportunity Act (AGOA) in terms of which goods from certain African countries, including South Africa, are granted preferential access to the US market. South Africa’s participation is subject to review because of objections by the US poultry lobby that US chicken exports to South Africa are subject to high anti-dumping duties. Negotiations are ongoing between the South African Poultry Association and the US poultry organisations, as well as between diplomats from the two countries. The customs division of the South African Revenue Service (SARS) has, over the past few years, taken significant steps towards modernising the customs control systems, including electronic filing and processing of documents and an electronic risk assessment system. This allows for more efficient clearance of goods at the border posts, as well as for greater security.”


CONTRIBUTORS

DLA Piper

FisherBroyles

Holman Fenwick Willan LLP

Jones Day

Lakshmikumaran & Sridharan

Marval O’Farrell & Mairal

TozziniFreire Advogados

Webber Wentzel


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