Further memorandum from HM Revenue and
Customs
In response to the issue of incompatibility
in the way the HMRC customs database and the declaration processing
system reports and the way ECO registers use of open licences,
(which was raised during the oral evidence given by Mr David Hayes,
Chairman of EGAD, Mr Brinley Salzmann, Secretary of EGAD, Ms Bernadette
Peers, Strategic Shipping Company and Mr Barry Fletcher, Fletcher
International Export Consultancy. (Q123, HC (2007-08) 254)).
We would advise that customs export declaration
information submitted electronically to the customs processing
system Customs Handling of Import and Export Freight (CHIEF) is
captured and can be interrogated through a management reporting
system.
The use of open licences is generally for low
risk goods exported to low risk destinations, as such there is
a significant number of this form of licence used averaging approximately
25,000 per year.
Information provided on an export declaration
where an open export licence has been declared will be processed
through the customs computer CHIEF and appropriate validation
checks will be performed as part of this process, these validation
rules are based on the information provided which includes the
notification that use of an open licence has been declared.
To ensure that our processing and validation
rules applied to the declaration data are targeted to identify
risk, HMRC undertake a percentage of manual interventions requesting
all supporting documentation associated with the declaration to
be presented to our National Clearance Hub (NCH) for verification.
The information for application to register
for an export licence and the provision of information to make
a customs declaration at export will be different, though there
will be a degree of overlap and HMRC and ECO can legally exchange
information where necessary through the appropriate gateway.
HMRC has received a request to provide statistics
on the usage of open licences under the Freedom of Information
Act (FOI). Upon interrogation of our management system in combination
with the scope and detail of the request. It was identified that
additional information would be required from the supporting documentation,
to enable a full and accurate response to be created.
A decision was reached that the application
of reasonable resources to request, collate and review supporting
documents together with our electronic management data, would
take the time and costs beyond those set out within the limits
within the provisions of the FOI Act, which was communicated to
the requester.
In addition, the committee requested a note
on the monitoring of the internet. As advised during the committees
visit to Southampton HMRC were involved in the initial discussions
and would have undertaken appropriate enforcement action were
any breaches discovered. The internet monitoring project and pilot
study was undertaken by the ECO which started on the 1 February
2007 and was scheduled to run for a period of four months.
Subsequent to this pilot project that employed
an automated web crawler there was no evidence produced to suggest
that there is any trade in items defined within the project parameters
from the UK or through UK based websites, ECO have concluded that
the resourcing required to continue monitoring the automated work
is manageable within their own resourcing constraints, which is
reviewed every 3 months to ensure that it is staying within current
resources.
June 2008
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