8th January 2019
The suspension of concession under General Agreement on Tariffs and Trade (GATT) 1994 led to the introduction of Implementing Regulation 2018/886. From 22 June 2018, additional customs duties were liable on goods listed in Annex 1 and 2 of this Regulation originating from the USA.
As a result of Regulation 2018/886 an examination of economic conditions is required for existing Special Procedure authorisations.
Businesses that import goods listed in Annex 1 and 2 of this Regulation originating from the USA may no longer benefit from the use of equivalence. This is because goods that attract additional duty for example safeguard measures cannot be used for equivalence. (See Regulation 2015/2446 Article 169(2).)
The special cases of discharging Inward Processing procedure will no longer be possible on any of the goods listed in Annex 1 and 2 of this Regulation originating from the USA. Therefore, from 22 June 2018, relief from import duty, additional duty and import VAT is only available where the authorisation holder is able to evidence discharge of the procedure by another eligible method (for example re-export). (See Regulations 2015/2447 Article 324(1) and (2).)
If evidence of eligible discharge cannot be provided, a customs debt arises and this includes the import duty, additional duty and import VAT originally suspended at import as per Regulation 2015/2446 Article 168(1).
There will be no changes to authorisations that allow the additional duty to be calculated by the method explained in Article 86(3) of Regulation 952/2013 when goods are declared to free circulation.
HMRC will be writing to relevant authorisation holders with an amendment to their authorisation to reflect these changes. You can access CIP 19 here.
For further information please contact your Supervising Office.
For general HMRC queries speak to the VAT, Excise and Customs Helpline.