6 Customs
| (a)
(27107)
15380/05
+ ADDs 1-2
COM(05) 608
(b)
(27108)
15381/05
+ ADDs 1-2[24]
COM(05) 609
|
Draft Regulation laying down the Community Customs Code (Modernised Customs Code) — Implementing the Community Lisbon programme
Draft Decision on a paperless environment for customs and trade — Implementing the Community Lisbon programme
|
| Legal base | (a) Articles 26, 95, 133 and 135 EC; co-decision; QMV
(b) Articles 95 and 135 EC; co-decision; QMV
|
| Department | Revenue and Customs
|
| Basis of consideration | Minister's letter of 26 January 2007
|
| Previous Committee Report | HC 34-xvii (2005-06), para 5 (1 February 2006) and HC 34-xxxi (2005-06), para 7 (14 June 2006)
|
| To be discussed in Council | Not known
|
| Committee's assessment | Politically important
|
| Committee's decision | Not cleared, further information requested
|
Background
6.1 The Community Customs Code, which establishes the general
rules and procedures applicable to goods brought into or out of
the customs territory of the Community, was set out in Regulation
(EEC) No 2913/92. Since 1992 the Code has had some limited amendments
but it has not kept abreast of recent changes in the global trading
environment.
6.2 The draft Regulation, document(a), is a complete
revision of the Community Customs Code, designed to modernise
and simplify it and to make it compatible with operational changes
in international trade, the greater use of electronic communications
and the evolving role of customs authorities. The draft Decision,
document (b), is intended to promote implementation of interoperable
and accessible automated customs systems that are coordinated
across the Community, committing the Commission and Member States
to re-engineer Customs activity for the electronic age within
specific timescales, in order to achieve the objective of a simple
and paperless environment for customs and trade. The intention
is to establish electronic interfaces for traders with Member
States' systems. Responsibility for implementation is to be shared
between the Commission and Member States.
6.3 When we considered these documents in February
2006 we said these were important proposals which could lead to
significant improvements for traders in regard to customs. However
we commented that before considering the documents further we
should like to:
- hear about the outcome of the
Government's formal consultation and more about the likely costs
of implementation; and
- be kept informed of progress on the issues,
to which the Government had drawn our attention, related to Member
State shares of customs duty, collection of national taxes and
statistical information, respect for Member State competences
(notably in relation to the imposition of criminal penalties under
the EC Treaty), the balance between the Modernised Customs Code
and its Implementing Provisions and the proposed Guidelines.
In June 2006 we reported further information about
the likely costs of implementation, but noted we still needed
to see the outcome of the Government's consultation and information
on progress on the other issues we had asked about previously.
Meanwhile we did not clear the documents.[25]
The Minister's letter
6.4 The Paymaster General (Dawn Primarolo) tells
us now of a possible first reading agreement on the draft Decision,
document (b), which arose because, unusually, the proposal had
been under consideration by the European Parliament and the Council
in parallel. She says however that discussion in the Council's
Customs Union Group (CUG) of the draft Decision has led to substantial
amendment of important elements relating to implementation timescales.
The German Presidency will be carrying discussions forward with
a view to CUG agreement on text to be transmitted to the European
Parliament. The Minister says that discussion of the draft Regulation,
document (a), will also continue during the German Presidency.
6.5 The Minister also addresses the outstanding points
we had raised previously, mainly in relation to the draft Regulation.
First, she says there was a low response to the Department's formal
consultation on the Modernised Customs Code and the associated
paperless environment proposals, conducted over the three months
ending 30 September 2006. The views were that:
- modernisation was long overdue;
- existing systems should be utilised where possible;
- Authorised Economic Operator status should be
available to businesses of all sizes and have a common application
in all Member States; and
- it was too early to provide quantifiable costs
to the changes.
The Minister adds that informal consultation will
continue through the Department's Joint Customs Consultative Committee
and its sub-groups during continued discussion of the Modernised
Customs Code.
6.6 Next, on implementation costs the Minister tells
us that work on the technical and functional specifications of
the associated IT systems is ongoing and that, understandably
until this work is finalised she cannot refine further the estimates
she has already given us. Thirdly, in relation to Member State
shares of customs duty (Own Resources), collection of national
taxes and statistical information, the Minister says these issues
arise from the proposal for a Centralised Clearance procedure,
work on which is ongoing in a Commission Working Group, in which
the Government is playing a leading role and which will report
its findings after a final meeting in June 2007. She adds that
there is general support for the concept of Centralised Clearance
from Member States.
6.7 Turning to criminal penalties the Minister says
the text has been amended twice as a result of discussions in
the CUG and currently makes no reference to such penalties. This
is supported with a proposed amendment by the European Parliament
— the Commission has rejected this, but has not resisted
the CUG's similar amendment.
6.8 Lastly, the Minister says of the balance between
the Modernised Customs Code and its Implementing Provisions and
the proposed Guidelines that comitology is still a contentious
issue, especially with the recent introduction of the new comitology
procedure, Regulatory with Scrutiny.[26]
The European Parliament has proposed that this procedure should
be used in the majority of the Modernised Customs Code references
to its Implementing Provisions. This has not been accepted by
the Council or the Commission, but the final position has yet
to be determined. The Guidelines remain a lower level of clarification
of the legal provisions and have no legal status.
Conclusion
6.9 We are grateful to the Minister for this information
on where matters stand on these two proposals. We note that the
probable outcome on a number of issues, Centralised Clearance,
criminal penalties and comitology, remains as yet uncertain. We
should like to hear about developments on these matters before
we consider these documents further. Meanwhile they remain uncleared.
24 Note that the documents 15381/05 ADDs 1-2 are the
same as 15380/05 ADDs 1-2. Back
25
See headnote. Back
26
Comitology is the system of committees which oversees the exercise
by the Commission of legislative powers delegated to it by the
Council and the European Parliament. Comitology committees are
made up of representatives of the Member States and chaired by
the Commission. There are three types of procedure (advisory,
management and regulatory), an important difference between which
is the degree of involvement and power of Member States' representatives.
Regulatory with Scrutiny, introduced in July 2006, gives a scrutiny
role to the European Parliament in most applications of comitology. Back
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