Latest edition of EY Belgium’s Customs and Excise update

Version 3, 2023 of Tradewatch is out now! 

The latest edition of our TradeWatch offers valuable insights into the ever-evolving landscape of global trade. This TradeWatch covers trending trade topics such as: the normalization of supply chain disruption; the dynamic impact of Brexit on trade in Great Britain, Northern Ireland, and the EU, with a comprehensive update on the UK-EU Windsor Framework. As sustainability and ESG remain at the forefront, this edition features articles on the recent carbon measures in the EU, their potential adoption in Australia, waste reduction and the imperative for a circular economy. The challenges faced by customs authorities in the digital age, customs reforms, WTO harmonized classifications, and proposed changes to the EU’s Union Customs Code are also addressed in this edition. Delve into the interplay between customs valuation and transfer pricing in Asia Pacific, as well as trade facilitation measures in Latin America, including enhancements to Brazil's AEO program. This edition also provides for an overview of our Global Trade webcasts and podcasts, articles and tax alerts published in 2023. 
 

New notice on non-manipulation certificates published by Antwerp Customs

The Antwerp customs authorities have published a new notice, 2023/101/0105, along with a template for the endorsement of a non-manipulation certificate. The note has been in force since 13 November for goods held in temporary storage or in a customs warehouse in Antwerp and are awaiting transport to their destination. The new template is mandatory when requesting a non-manipulation certificate and the wording cannot be modified. Furthermore, the notice lists different document types that can be used to evidence that the goods have not undergone any operations that could change their preferential origin qualification. 
 

Belgium imposes an export ban on hazardous substances to non-EU countries

By Royal Decree, issued on 19 November 2023, Belgium introduces an export ban on certain hazardous substances from Belgium to non-EU countries. The Belgian Decree enlarges the scope of the European Union current legal framework, as certain harmful pesticides were already forbidden or strictly regulated within the EU by Regulation (EU) 649/2012, commonly referred to as the PIC Regulation. Exporters based in Belgium are prohibited from exporting items listed in Annex 1 and 2 of the Royal Decree to countries outside the European Union unless expressly authorized by other European legislation. The prohibition does not apply to external transit (T1) or internal transit (T2). Lastly, these restrictions will take effect from 28 May 2025, and they will remain in place for a minimum of six months.
 

EU Combined Nomenclature 2024 has been published

On 31 October 2023, the European Commission published a new version of the Combined Nomenclature (CN), that will come into effect on 1 January 2024. For more information regarding the updated Nomenclature, consult our alert. 
 

ECJ judgement (C-210/22) regarding the non-preferential origin of tubes, pipes and hollow profiles

On 21 September 2023, the European Court of Justice (‘ECJ’) delivered a ruling in the Stappert Deutschland GmbH case, pertaining to the non-preferential rules of origin for goods whose production involves multiple countries. The ECJ ruled that the primary rule listed in Annex 22-01 of the Delegated Regulation 2015/2446 was invalid, as it excluded the substantial transformation process for tubes and pipes under the HS subheading 7304 49 into seamless tubes, pipes under HS subheading 7304 41. The Court ruled that, while the Commission has discretion in applying the general principles of Article 60(2) UCC to specific workings and processing, it should not adopt entirely different approaches for similar processes without a valid justification. The ECJ stated that the Commission lacked a convincing motivation for the different treatment of tubes or pipes and hollow profiles - all classified under subheading 7304 41 and derived from products under subheading 7304 49. The ECJ deemed it contradictory and discriminatory that the primary rule allows cold forming to determine the origin of hollow profiles using an alternative criterion, while an identical type of forming when applied to pipes and tubes can determine their origin only using a much stricter criterion. 
 

ECJ case (C-653/22) concerning the proportionality of a fine for stating the incorrect country of origin on a customs declaration

Hungarian customs took the view that, because of the indication of an incorrect country of origin leading to the avoidance of anti-dumping duties, customs duties were underpaid. This gave rise to the imposition of a fine at the rate of 50%, calculated based on the total amount of underpaid customs duties. The ECJ stated that any person directly or indirectly involved in customs formalities is obliged to provide accurate and complete information. In case of failure of that obligation, it is for each member state to provide for effective, proportionate, and dissuasive penalties. They concluded that an administrative fine corresponding to 50% of the underpayment of customs duties may be regarded as effective and dissuasive. As the Hungarian legislation provides for an administrative fine that is directly proportionate to the shortfall of the customs duties and where the percentage of that fine can be reduced or increased based on the severity of the infringement as specified in that legislation the fine was deemed proportionate.
 

European Commission publishes recommendations on the use of electronically issued movement certificates

Due to the limited interaction between economic operators and customs administrations during the COVID-19 pandemic, Pan Euro-Mediterranean (or PEM) members introduced an exceptional measure which allowed the use of electronically issued movement certificates. These certificates had to bear a digital signature, stamp, or cachet, or could be in paper or electronic form (scanned or available online). This measure was put forward to continue facilitated trade between PEM members during the pandemic. Given the positive outcomes of this temporary measure, the EU Commission supports its continuation on a long-term basis by putting forward a proposal for a Council decision. The transitional rules permit the use of electronically issued movement certificates. 
 

The current EU’s General System of Preferences (GSP) extended until end 2027

The European Union has decided to extend the existing GSP scheme until 31 December 2027. The EU’s GSP that has been proposed for the period 2024-2034 (the successor regulation), which aims to promote sustainable development in developing countries, has not yet passed the EU legislative process. To ensure a seamless transition, the European Commission has suggested extending the application of the present Regulation (EU) No 978/2012 until the proposed successor regulation takes effect. If the subsequent regulation comes into force earlier than expected, the extension period will be shortened accordingly, and if the regulation is published after 31 December 2023, the new rules will apply retroactively from 1 January 2024, providing legal assurance and uninterrupted application.
 

Provisional anti-dumping duties on imports of certain PET products originating in China

On 30 Match 2023, the European Commission initiated an anti-dumping investigation regarding imports of polyethylene terephthalate (PET), having a viscosity of 78 ml/g or higher according to ISO Standard 1628-5, currently falling under CN code 3907 6100 and originating in China.

The European Commission concluded, based on the investigation, that there was an imminent and clearly foreseeable injury to the Union Industry at the end of the investigation period. The Commission decided to apply provisional anti-dumping duties as from 28 November, ranging between 6,6% and 24,2%. The regulation provides a comprehensive list of the companies in scope, together with the applicable anti-dumping rates. 
 

Commission welcomes political agreement on stronger control of exports of waste

In line with the objectives of the European Green Deal to curb pollution and advance a circular economy, the EU Commission has endorsed a political agreement on waste shipments. The agreement aims to increase responsibility for waste management within the EU and it prohibits the exporting of plastic waste to non-OECD countries. The ban could be lifted for countries meeting stringent environmental standards five years after the entry into force of the rules. The new agreement will address environmental and public health concerns in third countries, while stimulating a shift towards a circular economy and safeguarding raw material supplies. The next step involves the formal adoption of the regulation by the EU Parliament and Council, in line with the political agreement.
 

EU-New Zealand: Council gives final green light to free trade agreement

The Council has approved a free trade agreement (FTA) between the EU and New Zealand. Awaiting New Zealand's completion of its legal procedures, the FTA, which seeks to liberalize trade and investment, could enter into force by early 2024. Given the substantial bilateral trade between the partners of nearly €9.1 billion in 2022, the FTA is projected to boost trade between the contracting parties by up to 30%, while it has the potential to increase EU investments into New Zealand up to 80% and to cut € 140 million a year in duties for EU companies. 

The EU-NZ FTA is the first of its kind to integrate the EU's new approach to trade and sustainability development (TSD). The agreement aims to eliminate tariffs on crucial EU exports (such as pig meat, chocolate, wine and sparkling wine), ensuring non-discriminatory treatment of EU and NZ investors, while reducing procedural barriers to expedite the goods flow. Furthermore, the deal contains provisions addressing sustainability of food systems, gender equality, and the fossil fuel subsidies reform. 
 

New guidelines published to calculate recycled plastic content on single-use plastic beverage bottles

On 1 December 2023, new guidelines were published for calculating the recycled content in single-use plastic beverage bottles. These guidelines are part of the implementation of the Single-Use Plastics Directive. The rules aim to verify and report on the recycled plastic content in these bottles. The directive sets specific goals: by 2025, PET bottles should contain at least 25% recycled plastic, and by 2030, this target increases to at least 30%. 
 

New guidance published regarding special procedures

On 30 November 2023, the European Commission published a new guidance regarding special procedures. The guidance is a non-binding instrument, which can nonetheless be used to better understand the meaning of certain provisions of EU customs legislations. The document provides guidance on the following special procedures: storage, customs warehousing, free zones, temporary admission, end-use and processing. The guidance regarding the import duty calculation for goods resulting from the outward processing procedure (processed products) or replacement products, as well as the guidance regarding import duty relief for goods repaired or altered in the context of international agreements have been amended.