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Introduction Of EU Customs Monitoring System Imminent

by Ulrika Lomas, Tax-News.com, Brussels

27 December 2010


The European Commission has confirmed that from January 1, 2011, the EMCS (the Excise Movement and Control System), a new computerised system for monitoring the movement of alcohol, tobacco and energy products within the EU, is to become fully operational, allowing member states to more efficiently administer custom duties.

Member States have also made a major investment in EMCS and will benefit from improved monitoring and tools for tackling excise fraud. Member States' authorities and economic operators must join the system by January 1, 2011, marking the end of the transitional period which started on April 1, 2010.

The Excise Movement and Control System (EMCS) will make intra-Community trade in excise goods cheaper and simpler for operators, while also making it quicker and easier for Member States to tackle excise fraud.

EU Commissioner Algirdas Šemeta for Taxation and Customs Union, Audit and Anti-Fraud, said: "Tackling fiscal fraud is a top priority for the Commission and Member States, and this new electronic system will help a lot with this goal. It will also be of great benefit to traders within the EU, by cutting red tape and reducing compliance costs."

Designed to replace the current paper-based system – which from January 1, 2011, will no longer be permitted – the EMCS is a computerised structure for recording in real-time the movement of products for which excise duties have still to be paid. It is estimated that about 100,000 traders dispatch around 4.5 million consignments of excise goods between Member States each year, and the EMCS will help to reduce the financial and administrative burdens that they face. Member States' authorities and economic operators can join the system progressively until January 1, 2011, after which the EMCS will be fully applied throughout Europe.

Under EU legislation, excise duties must be paid on alcohol, tobacco and energy products at the final point before consumption. Therefore, while these goods are in transit to their final destination and no excise duty has yet been paid on them, Member States need a system of monitoring their movement to ensure that the duties are properly levied at the final destination. Currently, a paper-based system is applied, whereby the person who consigns the goods must complete an "Accompanying Administrative Document" (ADD) which travels with the goods to their final destination. Once the consignment arrives at its final destination, the recipient must acknowledge its receipt through the paper based procedure.

The EMCS will replace the paper AAD with an electronic record – the e-AD. This e-AD is sent electronically by the consigner of the goods to the final recipient, via the EMCS systems in the Member States of dispatch and destination. When the goods arrive, the recipient files an electronic report of receipt, which is sent to the consignor who can then discharge the movement. This computerised system makes the whole process much faster and easier for traders, and also allows them to recover the financial guarantees they had to make for the excise products much more quickly.

The EMCS will allow Member States to monitor more closely and accurately the movement of goods for which excise duties have still to be paid. This will create faster information exchange between authorities and help to prevent and detect excise fraud.

TAGS: compliance | tax | European Commission | export duty | excise duty | legislation | import duty | trade | European Union (EU) | Europe

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