Thirty-ninth Report of Session 2012-13 - European Scrutiny Committee Contents

15   Customs Union



COM(11) 922

Commission Report: Report on progress on the strategy for the evolution of Customs Union

Legal base
DepartmentRevenue and Customs
Basis of considerationMinister's letter of 8 April 2013
Previous Committee ReportsHC 428-lii (2010-12), chapter 10 (29 February 2012 and HC 86-xxxv (2012-13), chapter 11 (13 March 2013)
Discussion in Council10-11 December 2012
Committee's assessmentPolitically important
Committee's decisionCleared


15.1  A current EU customs reform programme has three elements:

  • modernising EU customs legislation — the Modernised Customs Code;[47]
  • the basis for a paperless customs environment — the e-Customs Decision;[48] and
  • a strategy for evolution of the Customs Union.

15.2  The latter originated from the review of the role and work of EU customs carried out by the Commission and Member States which was adopted by the directors general of customs of the 27 Member States in 2007. This provided the basis for the subsequent 2008 Commission Communication: Strategy for the evolution of the Customs Union,[49] which was endorsed by the ECOFIN Council and the European Parliament in May and June 2008 respectively, the former asking the Commission for a progress report during 2011. The Commission subsequently undertook a number of studies to evaluate the efficiency and effectiveness of the Customs Union, which included gathering data from a variety of sources, including Member States and the trade.

15.3  In December 2011 with this Report the Commission responded to the Council's May 2008 request for a progress report. It set out the Commission's view of progress on the strategy for the evolution of the Customs Union, provided the background to the strategy, highlighted developments since 2008, reported on key areas and concluded with ideas on the way forward.

15.4  In February 2012, when we considered the Report, we noted, although the document was not a legislative proposal, the Government's concerns about competence creep and implications for some existing or future legislative proposals. We said that we would, therefore, not consider this document further until we had an account from the Government about progress with its attempts to mitigate the problems in proposed Council Conclusions. When we next considered the document, this March, we heard that Conclusions had been endorsed at the Competitiveness Council in December 2012. We said that it was deeply regrettable that we had heard nothing from the Government about development of Council Conclusions since our Report on the matter in February 2012 and had heard about their adoption only after the event. We asked to have very quickly a full explanation of the reasons for this failure. Additionally, we asked to have an account of how the Conclusions met the Government's objective of mitigating the problems in the draft text, that is, in relation to concerns on competence and scope and the possibility of pre-emption of decisions yet to be taken on related matters such as FISCUS and the Eastern Border Action Plan. Meanwhile, the document remained under scrutiny.[50]

The Minister's letter

15.5  The Economic Secretary to the Treasury (Sajid Javid) opens his response by saying:

"Firstly I would like to apologise for not having kept you fully informed of the progress of discussions on the Council Conclusions in this case. This was a regrettable administrative oversight in failing to bring forward this file to ensure that your Committee was updated in a timely manner as part of the scrutiny process."

15.6  The Minister then reminds us of the discussions on this document between February and December 2012 and tells us in what ways the initial draft Council Conclusions were not acceptable to the Government:

  • inclusion of references to FISCUS (a proposal since withdrawn and replaced with the Customs 2020 and Fiscalis 2020 proposals — the EU customs and tax administrative cooperation programmes) and the Eastern Border Action Plan which pre-empted the outcome of Council negotiations; and
  • failure to clarify that the Commission's Report should only focus on the Customs Union and matters of exclusive EU competence.

15.7  The Minister continues that:

  • the Government proposed a number of amendments to the Council Conclusions to address its concerns;
  • it was successful in removing the references to FISCUS and the Eastern Border Action Plan;
  • its suggested new wording to clarify the need to respect the division of competence between the EU and Member States on cooperation with other agencies and international partners in areas of security, health and safety and the environment was also accepted; and
  • on the basis of these amendments the Council Conclusions met the Government's objectives and were adopted unanimously in December 2012.


15.8  We note the Minister's comment about his scrutiny failure and trust that such failures will be avoided for the future.

15.9  We are grateful for the information about the satisfactory outcome on the Council Conclusions and now clear the document.

47   (27107) 15380/05 + ADDS 1-2: see HC 34-xvii (2005-06), chapter 5 (1 February 2006), HC 34-xxxi (2005-06), chapter 7 (14 June 2006), HC 41-x (2006-07) chapter 6 (21 February 2007) and HC 41-xxv (2006-07) chapter 14 (13 June 2007). Back

48   (27108) 15381/05 + ADDs 1-2: see HC 34-xvii (2005-06), chapter 5 (1 February 2006), HC 34-xxxi (2005-06), chapter 7 (14 June 2006), HC 41-x (2006-07) chapter 6 (21 February 2007) and HC 41-xv (2006-07), chapter 8 (21 March 2007). Back

49   (29590) 8027/08: see HC 16-xx (2007-08), chapter 15 (30 April 2008). Back

50   See headnote. Back

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