8 Customs
| (35670)
17949/13
+ ADDs 1-4
COM(13) 884
| Draft Directive on the Union legal framework for customs infringements and sanctions
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| Legal base
| Article 33 TFEU; co-decision; QMV
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| Department
| HM Revenue and Customs
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| Basis of consideration
| Minister's letter of 31 March 2014
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| Previous Committee Report
| HC 83-xxviii (2013-14), chapter 5 (22 January 2014)
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| Discussion in Council
| Not known
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| Committee's assessment
| Politically and legally important
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| Committee's decision
| Not cleared; further information requested
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Background
8.1 Currently, whilst customs legislation
is completely harmonised across Member States, each is able to
set its own sanctions for breaches of these rules.
8.2 The UK imposes civil penalties ranging
from £250 to £2,500 for breaches of customs regulations.
Penalties can be mitigated by up to 100%. If HMRevenue and Customs
or a Tribunal are satisfied that there is a reasonable excuse
for the breach there is no penalty. There is a separate more severe
penalty in circumstances where there has been a dishonest act
for the purposes of evading duty. The penalty is up to 100% of
the duty evaded or sought to be evaded. Mitigation is available
but not reasonable excuse.
8.3 In December 2013, with this draft
Directive, the Commission proposed a single penalty regime for
non-criminal infringements of customs legislation by individuals
and legal persons. For the UK this would mean replacement of both
penalty regimes. When, in January, we considered this matter we
said that, on the basis of what we had heard from the Government,
clearly this draft Directive is, as it stands, very unattractive.
We noted that, whilst the Government seemed willing to enter into
negotiations on the proposal, we presumed that, given the attitude
of the majority of Member States, it would be well placed to prevent
its adoption if the text remained so unacceptable. We asked to
know, once negotiations had advanced a little, what the prospects
were for significantly improving the text and, if poor, what the
Government's options were. Meanwhile the document remained under
scrutiny.[37]
The Minister's letter of 31 March 2014
8.4 The Economic Secretary to the Treasury
(Nicky Morgan) writes now to inform us of a JHA opt-in issue that
the Government has identified within this draft Directive. She
says that:
· the Government has concluded
that, even though there is no Justice and Home Affairs (JHA) legal
base cited for the proposal, Article 15(2) triggers the Opt-In
Protocol;
· the Article sets out the
rules for deciding which Member State can exercise its jurisdiction
where two or more Member States have an interest;
· one of the proposed tests
would give priority to a Member State bringing criminal proceedings
where another was proposing to bring civil proceedings;
· in the Government's view
such a provision engages Article 82 of the TFEU and the opt-in
applies;
· while it does not support
the bulk of the proposed Directive, the Government has decided
to opt into Article 15(2), because in its opinion it is helpful
to set out clear rules about which Member State would take action
where a customs infringement concerns two or more Member States;
and
· this should result in more
effective and speedier action against noncompliance and fewer
disputes between customs authorities, which, in principle, the
Government would support.
8.5 The Minister also says that:
· owing to the deadline, the
Government informed the Council Presidency of its decision to
opt in on 17 March;
· she regrets that she did
not to update us regarding this development at an earlier date,
as unfortunately on this occasion the JHA provision was not identified
at a suitably early stage; and
· she has asked officials to
ensure that internal processes are put in place to minimise the
likelihood of this occurring again.
Conclusion
8.6 We note the Minister's information
about the JHA issue the Government perceives, but remind her that
we do not accept the Government's contention that the Opt-In Protocol
applies to measures that do not have a JHA legal base. We also
note what she says about the delay in telling us of the Government's
action in this case.
8.7 As for the wider consideration
of the draft Directive, we observe that the Minister's comment
that "we do not support the bulk of the proposed Directive"
does not adequately meet our earlier request that the Minister
let us know, once negotiations have advanced a little, what the
prospects are for significantly improving the text and, if poor,
what the Government's options are, given the apparent opposition
to the proposal by the majority of Member States.
8.8 We should like the Minister to
now address this request. Meanwhile the document remains under
scrutiny.
37 See headnote. Back
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