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What it means to be An Authorized Economic Operator and ISO Certified


Contributed by Premier Brains
September 13, 2018



Who is An Authorized Economic Operator?

This refers to an economic operator who after meeting some set conditions is considered and referred to be relied upon in their custom related transactions in the whole of the European Union. This certificate is internationally recognized as a quality mark that indicates and confirms that your role in the worldwide supply chain is secure. It also indicates that a company’s custom controls, as well as their procedures, are compliant. This accreditation is important and mandatory for a company as it gives them quick access to some simplified customs procedures as well as the right to fast-track their shipments through some HM Revenue and Customs safety and procedures.

Criteria for Getting an AEO Certificate

For a company to get a Customs simplification Authorized Economic Operator certificate (AEOC), it must fulfill the below conditions for compliance, the solvency of the company and record keeping. To get a security and safety or a combination of both, the company also has to fulfill the security set conditions. Companies applying for all of the three different types of AEO certificate have to first be enrolled with the Economic Operator Registration and Identification Scheme.

Compliance

HM Revenue and Customs (HMRC) will look at your company’s record of compliance with the customs as well as the tax requirements for the past three years of business. If your company has been in existence for less than the three years, then the available tax requirements for the available time will be submitted. From the records given, HM Revenue and Customs will look at whether there have been any serious or a repetition of infringements of custom rules by either:

  1. The company.
  2. The stakeholders running the company.
  3. The team in the company who handle any custom related matters.
  4. The company’s legal firm that handles the customs matters.

Apart from this, the company needs to indicate that:

  • There are set procedures that can be used to capture and identify any irregularities to HM Revenue and Customs.
  • The company takes action when these irregularities are identified.
  • The company is able to come up with procedures that can be used in the handling of controlled goods. E.g. military goods, dangerous and hazardous goods.

Record Keeping

HM Revenue and Customs will confirm whether your company has a satisfactory system that is used in the managing of commercial transport records. On this, the company ought to have:

  1. A channel through which HM Revenue and Customs can get access to the company’s customs records.
  2. A working logistics system.
  3. Procedures that should be documented which are used in the management and control of the flow of goods.
  4. A working system in place to identify and capture any irregular an illegal transactions in the company.
  5. Trained staff in the company and one that is unbiased that can inform HM Revenue and Customs of any irregularities captured.
  6. Well maintained accounting records which should be frequently audited.
  7. Records of each and every audit done.

Solvency

The company has to prove that and show that it has been financially solvent for the past three years of business from the day it makes its application for the certificate. This record ought to reflect that the company is able to meet its financial obligations without any huddle.  HM Revenue and Customs will also check the company’s records to confirm if the accounts are filled on time. HM Revenue and Customs will also be expecting to see that the company’s current assets are positive but in case this is not so, they will understand as it is possible for a company to be having negative net assets.

Security of the Company

HM Revenue and Customs will check to know what the company has put in place to protect the company as a whole as well its supply chain against any possible risks which can range from human, natural, physical and economic. The company will need to:

  1. Adhere to the legal and health and safety requirements.
  2. Have had a safety and security assessment done on them.
  3. Has measure put in place to protect your cargo, restrict access to your shipping areas, cargo storage areas and loading docks?
  4. Have measure in place to protect your cargo desiring storage, manufacture, and transport.
  5. Have a document showing the different agreements between the company and its different suppliers.
  6. Carry out security screening on their new employees and suppliers.
  7. Make sure that the staff in the company is trained in matters security and safety requirements.

Who Can Apply for An Authorized Economic Operator Certificate?

Any company that is involved in the international supply chain and has its operations in the EU can apply for this certificate. The size of the company does not matter.

Steps on Applying for An Authorized Economic Operator Certificate

For a company to be deemed qualified to apply for an Authorized Economic Operator certificate, it ought to have an Economic Operator Registration and Identification Number as well as a complete application pack which contains: form C117 (basic information on the company) and form C118 (detailed description of the company’s operations.)

Both of the reforms are to be sent to HM Revenue and Customs for the application to be received and processed.

If your company has its operations in the EU member states and the UK, the application has to cover all of your business activities in these countries.

ISO Certification

In the manufacturing industry, a lot of emphasis is put on some given principles and standards. When manufacturing these products, it is important that the results are produced as per the set specifications with little or no margin of error.

To this effect, ISO developed and published more than 18,000 international standards of different products. The document ISO 9001:2008 outlines these requirements that organizations have to adhere to in their quality system. This is the only standard that requires physical certification.

Leading ISO certification experts JR Consultants tell us that ISO 9001:2008 will become obsolete come September 2018 and will be replaced by ISO 9001:2015. ISO 9001:2015 refers to the standard that lists the requirements an organization must maintain in their quality system for ISO 9001:2015 certification.

In conclusion, it is important for organizations to be certified because they stand to get more business because: they have proof that their products and services are of good quality and the certification shows that the organization’s main agenda is customer satisfaction.

 

Tags: business | tax | manufacturing | audit | compliance | standards | agreements | HM Revenue and Customs (HMRC) | accounting | employees | services | HM Revenue and Customs (HMRC) | Compliance | Europe

 

 

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