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Unit 3. Computerised Systems

1. New Computerised Transit System

1a. Reading

Read the text about the Computerised Transit System used in the European Union.

New Computerised Transit System

In today’s world, customs administrations have to adapt to the needs of trade with speed and flexibility and keep up with the continual changes in the business environment. A key part in it plays computerisation. Different computerised systems serve as a tool to manage and control movement of the goods. They guarantee a more modern and efficient management than the paper-based system.

The New Computerised Transit System (NCTS) is a European wide system that has been developed to enable traders to submit Community/Common Transit declarations electronically.

Community transit is a customs procedure which is used for the movement of goods between the EU Member States. It allows customs and excise duties and VAT on imported goods to be suspended until the goods either reach their point of destination in the Community or are exported out of it. The Community transit procedure can also be applied for movements to and from the European Free Trade Association (EFTA) countries, and is then known as Common transit. The EFTA countries are Switzerland, Liechtenstein, Norway, and Iceland.

The NCTS must be used for all Community/Common transit declarations except for private travellers and for some authorised simplifications. Any potential taxes and duties on the goods must be guaranteed. Use of the NCTS does not normally preclude use of other customs procedures such as customs warehousing.

The main objectives of the NCTS are:

•to increase the effectiveness of transit procedures;

•to improve the prevention and detection of fraud;

•to accelerate transactions carried out under a transit procedure and to offer security for them.

It is necessary for companies to have the facility to send and receive electronic messages to and from the NCTS. Connected traders will receive electronic responses advising of key decisions during the procedure such as acceptance of declaration, release of goods, etc., at both departure and destination.

There are two types of procedures available under the NCTS: Normal Procedures and Simplified Procedures.

Using the Normal Procedures any company connected to the NCTS will be able to lodge declarations at any Office of Departure. They will also have the possibility to “pre-lodge”, i.e. to input a declaration prior to the physical presentation of the goods.

Traders who are approved as Authorised Economic Operators can gain access to certain simplifications in customs procedures such as an approval to start the NCTS movements at their own premises (Authorised Consignors) or end the movements there (Authorised Consignees) without having to produce the goods to Customs. They must, however, become connected to the NCTS system and make their declarations electronically.

For companies, the advantages of using the NCTS include:

•improved quality of service – less time waiting at Customs, greater flexibility in presenting declarations;

•quicker control and release of goods at the Office of Destination, leading to earlier discharge of the transit procedure;

•reduction in the costs, time, and effort associated with the lengthy paper-based procedures for declaring goods;

•greater clarity of the transit operation;

•additional advantages for companies using Simplified Procedures as Authorised Consignors and Consignees.

1b. Vocabulary

Find English equivalents of the following in the text:

Автоматизированная система таможенного транзита Евросоюза; адаптироваться к потребностям торговли; идти в ногу с постоянными изменениями; подавать декларации в электронном виде; процедура Транзит в Сообществе / общий транзит; таможенная

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процедура; отсрочить уплату пошлин; Европейская ассоциация свободной торговли (ЕАСТ); упрощенные процедуры для уполномоченных лиц; не исключать применения других таможенных процедур; процедура таможенный склад; для ускорения операций, осуществляемых в рамках процедуры транзита; принятие декларации; выпуск товаров; внести в систему данные декларации; получить доступ; предъявлять товары; выполнение/завершение процедуры транзита; понятность,

прозрачность.

1c. Comprehension

Describe the following in your own words:

a) The New Computerised Transit System

b)Community Transit

c)Common Transit

d)Normal Procedures

e)Simplified Procedures

f)Authorised Consignors

g)Authorised Consignees

h)The main objectives of the NCTS

i)Advantages of using NCTS for companies

1d. Over to you

Study the sample arrival notification under the NCTS below and answer the questions:

1.Who received the goods?

2.What was the status of the goods?

3.What procedure was applied?

4.What was the customs office of destination?

5.When were the goods discharged?

6.How many items were there in the consignment?

7.What was the total weight of the cargo?

8.Were there any damages caused to the seals?

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1e. Reading

Complete the texts about the automated systems operated in the UK and the US with the words from the boxes.

released assessment processing conversions errors complete compiling access

Customs Handling of Import and Export Freight System

The Customs Handling of Import and Export Freight (CHIEF) system is one of the largest and most advanced customs declaration a) __________ systems. It is used to record electronically the UK's international trade movements by land, sea, or air. CHIEF is an essential tool in b) __________ accurate international trade statistics and helps to stop the smuggling of prohibited goods.

Businesses have used CHIEF since 1994 to help c) __________ customs formalities. Traders find CHIEF useful because it sends all information relating to their imports and exports electronically to Customs. CHIEF calculates duties, currency and quantity d) __________, and provides an automatic clearance of consignments. CHIEF can also identify which goods need to be physically examined and can be used as a tool for risk e) __________. It also advises users of any f) __________ in their customs declarations.

For exports, traders can submit the Single Administrative Document (SAD) Export Declaration electronically using one of two customs systems: the National Export System (NES) which is applied only for third country goods, or the New Computerised Transit System (NCTS) used to make declarations under Community or Common Transit arrangements.

For imports, traders need to submit an import declaration at the point of entry, which may be a port, airport, or an inland clearance depot. Many entry points have an electronic Community Systems Provider (CSP) that can give electronic g) __________ to CHIEF so importers can submit declarations. CSPs can also let them know when their goods are h) __________.

distribute scored sharing track violations single-window warrants consolidates

Computerised Systems used by US Customs and Border Protection

The Automated Targeting System (ATS) is a system that assists customs officers in identifying imports which pose a high risk of containing narcotics or other contraband. The system standardises bill-of- lading, entry, and entry summary data received from the Automated Commercial System (ACS) and creates integrated records called “shipments”. These shipments are then evaluated and a) __________ by ATS. The higher the score, the more the shipment b) __________ attention. The ATS is installed at all major seaports, airports, and land border ports of entry. It can also be expanded to operations to target export cargo for potential terrorist threats, currency smuggling and other export c) __________.

The Automated Commercial System (ACS) is the system used by the US Customs Service to d) __________, control, and process all commercial goods imported into the United States. ACS facilitates merchandise processing, significantly cuts costs, and reduces paperwork requirements for both Customs and the trade community.

CBP is now developing the Automated Commercial Environment (ACE) to replace the Automated Commercial System (ACS) which was developed more than 20 years ago. The goal is to accelerate the modernisation of CBP’s trade process. ACE e) __________ information from the Automated Targeting System, Traveler Enforcement Compliance System/National Crime Information Center, Free and Secure Trade, and the Automated Commercial System. ACE’s f) __________ filing will allow the trade community to submit data required by all federal agencies for the clearance of cargo in one place. ACE’s inter-agency data g) __________ will h) __________ international trade and transportation data to all Federal agencies involved in import, export and transportation-related decision making.

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1f. Pairwork

An exporter is calling AES* to find out about response messages which the AES can send in different filing scenarios. Put his/her phrases in the correct order to make up a conversation. Practise the conversation with your partner.

*Automated Export System (AES) is the system used by US exporters to electronically declare their international exports to Customs and Border Protection.

1.What is a fatal error?

2.I think I got it. Thanks a lot for your help.

3.Hello again! I spoke to you a few minutes ago about how to register for the AESDirect Service and file a shipment. Well, I have another question. I got the Internal Transaction Number in the email, but what do I do with it now?

4.Okay, but what is a verify message and what is a compliance alert?

5.What could cause a fatal error?

6.Well, that doesn't make much sense unless, of course, these are platinum paperclips.

7.Okay, I understand now.

8.What kind of messages are those?

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Unit 4. Customs Procedures in the European Economic Community 1. Customs Unions as a Level of Economic Integration

1a. Reading

Read the text about economic integration and match the levels of economic integration to the paragraphs describing them. Then look at Fig.5 below and see if you were right.

1.Economic union

2.Customs union

3.Political union

4.Common market

5.Free trade

Economic Integration

There are several levels of economic integration:

•a) __________ Tariffs between members are abolished or significantly reduced. Each member keeps its own tariffs in regard of third parties. The general goal is to develop economies of scale and comparative advantages.

•b) __________ Sets common external tariffs among members, implying that the same tariffs are applied to third parties.

•c) __________ Factors of production, such as labour and capital, are free to move within members, expanding scale economies and comparative advantages.

•d) __________ Monetary and fiscal policies between members are harmonised as well as the use of a common currency. It also implies a level of political integration. This type of economic integration does not truly exist but the European Union is the closest example.

•e) __________ Represents the potentially most advanced form of integration with a common government.

Figure 5. Levels of economic integration.

Customs unions

A customs union is an association formed when two or more sovereign states agree to eliminate or reduce trade barriers among themselves and to adopt a common trade policy toward outsiders. Customs unions are designed to lower costs of imported goods and to enlarge markets. They stimulate commerce and industry within the union by allotting to each member a specialised economic structure in which each country may concentrate on those products that are easiest to produce in terms of its resources and, when possible, may import other essential products from the member countries at minimal expense.

Several important customs unions are in operation today, including the European Economic Community. This customs union has established a common external tariff among member nations and eliminated internal tariffs.

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The European Economic Community

The European Economic Community is based upon a customs union. In the interests both of economic operators and of the customs authorities in the Community current customs legislation has been assembled in a Community Customs Code. Customs legislation reflects the new economic reality and the new role and mission of customs authorities.

The completion of the internal market, the reduction of barriers to international trade and investment, and the reinforced need to ensure security and safety at the external borders of the Community have transformed the role of customs authorities. They now play a leading role within the supply chain and in monitoring and management of international trade.

The customs territory of the Community (as of 2009) comprises the territory of: the Kingdom of Belgium, the Republic of Bulgaria, the Czech Republic, the Kingdom of Denmark, except the Faeroe Islands and Greenland, the Federal Republic of Germany, the Republic of Estonia, Ireland, the Hellenic Republic, the Kingdom of Spain, the French Republic, the Italian Republic, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Grand Duchy of Luxembourg, the Republic of Hungary, Malta, the Kingdom of the Netherlands, the Republic of Austria, the Republic of Poland, the Portuguese Republic, Romania, the Republic of Slovenia, the Slovak Republic, the Republic of Finland, the Kingdom of Sweden, the United Kingdom of Great Britain and Northern Ireland.

1b. Vocabulary

Find English equivalents of the following in the text:

отменять; экономия (эффект) от масштаба (снижение средних затрат по мере увеличения объема выпуска); сравнительные преимущества; предполагать, подразумевать; устранять; наделение, распределение; Европейское экономическое сообщество (ЕЭС); Таможенный

кодекс Европейского Сообщества; усилившийся, возросший.

1c. Comprehension

Name the key features of a customs union. Give examples of other customs unions.

2. Customs Procedures in the European Economic Community

2a. Reading

Read the text about some customs procedures defined in the Community Customs Code.

The Community Customs Code contains the general rules and procedures which ensure the implementation of the tariff and other common policy measures introduced at Community level in connection with trade in goods between the Community and countries or territories outside the customs territory of the Community, taking into account the requirements of those

common policies, laying down the general rules and procedures applicable to goods brought into or out of

the customs territory of the Community.

Presentation of goods to Customs

Goods brought into the customs territory of the Community shall be presented to Customs immediately upon their arrival at the designated customs office or any other place designated or approved by the customs authorities. All goods intended to be placed under a customs procedure, except for the free-zone

procedure, shall be covered by a customs declaration appropriate for the particular procedure.

Types of customs declarations

•The customs declaration shall be lodged using an electronic data-processing technique. The customs authorities may allow the customs declaration to take the form of an entry in the declarant’s records, provided that the customs authorities have access to those data in the declarant’s electronic system and that the requirements for any necessary exchange of such data between customs offices are met.

•Where this is provided for in the customs legislation, the customs authorities may accept a paperbased customs declaration, or a customs declaration made orally or by any other act whereby goods can be

placed under a customs procedure.

Obligation to place non-Community goods under a customs procedure

All non-Community goods presented to Customs shall be placed under a customs procedure. The term “customs procedure” means any of the following procedures under which goods may be placed in accordance with the Code:

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a)release for free circulation;

b)special procedures;

c)export.

The declarant is free to choose the customs procedure under which he wishes to place the goods, under the conditions for that procedure, irrespective of their nature or quantity, or their country of origin,

consignment, or destination.

Release for free circulation

Non-Community goods intended to be put on the Community market or intended for private use or consumption within the Community shall be placed under release for free circulation.

Release for free circulation shall entail the following:

•the collection of any import duties due;

•the collection, as appropriate, of other charges, as provided for under relevant provisions in force relating to the collection of those charges;

•the application of commercial policy measures and prohibitions and restrictions insofar as they do not have to be applied at an earlier stage;

•completion of the other formalities laid down in respect of the importation of the goods.

Release for free circulation shall confer on non-Community goods the customs status of Community

goods.

Special procedures

Goods may be placed under any of the following categories of special procedures:

a)transit, which comprises external and internal transit;

b)storage, which comprises temporary storage, customs warehousing and free zones;

c)specific use, which comprises temporary admission and end-use;

d)processing, which comprises inward and outward processing.

Storage in customs warehouses

1.Under the customs warehousing procedure, non-Community goods may be stored in premises or any other location authorised for that procedure by the customs authorities and under customs supervision.

2.Customs warehouses may be available for use by any person for the warehousing of goods (public customs warehouse), or for the storage of goods by the holder of an authorisation for customs warehousing (private customs warehouse).

3.Goods placed under the customs warehousing procedure may be temporarily removed from the customs warehouse. Such removal must, except in case of force majeure, be authorised in advance by the customs authorities.

2b. Vocabulary

Find English equivalents of the following in the text:

гарантировать применение; устанавливающий правила; применимый к; назначенный; быть помещенным под таможенную процедуру; процедура «свободная таможенная зона; (на товары) оформляется таможенная декларация; запись в базе данных; при условии

что; быть предусмотренным таможенным законодательством; в соответствии с чем/которым; выпуск для внутреннего потребления (свободного обращения); специальные таможенные процедуры; повлечь за собой; действующие правила, существующие положения; в той мере; установленные в отношении; присваивать; включать в себя; процедура «временное хранение»; процедура «временный ввоз»; завершающая таможенная процедура; процедура «переработка на таможенной территории»; «переработка вне таможенной территории»; процедура «таможенный склад»; таможенный склад открытого типа; таможенный склад закрытого типа; форс-мажор (обстоятельства непреодолимой силы); быть предварительно санкционированным.

2c. Discussion

1.What are the similarities and differences between customs procedures in the EEC and the Russian Federation?

2.What are the latest changes in the Russian customs rules and regulations?

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2d. Vocabulary

Complete the text about сustoms transit procedures with the ideas from the box.

Customs transit is defined in the Revised Kyoto Convention, 1999 (RKC) managed by the World Customs Organisation (WCO) as a “customs procedure under which goods are transported under __________ from one customs office to another”. The WCO definition of customs transit

procedures covers __________ (from a customs office of entry to an inland customs office),

________________(from the inland customs office to the customs office of exit), and __________ (from one inland customs office to another in the same country).

A distinction has to be made between national and international customs transit procedures. A national customs transit procedure covers only transit in one customs territory with the __________in the same customs territory. Multilateral transit procedures (bilateral, regional, or international) on the other hand cover transit across several customs territories, e.g., either through a fully integrated procedure such as the EU community transit system, or through a harmonisation of certain aspects of transit operations such as the TIR system so that a __________ and/ or guarantee can be used for the entire transit operation across several countries.

Customs transit procedures normally also contain provisions regarding the sealing of __________

and other __________, standardised required documentation, and mutual recognition of authorised traders. It is general practice that, with a view to securing the duties and taxes of goods in transit, thereby

reducing the risk of the goods being diverted for __________ without duty and tax payment, a __________

is required by customs authorities when permitting a transit operation to be carried out.

2f. Translate the text from English into Russian using a dictionary.

Export and Re-export Procedures

Community goods

Community goods destined to leave the customs territory of the Community shall be placed under the export procedure. This regulation shall not apply to the following goods:

•goods placed under the end-use or outward-processing procedure;

•goods placed under the internal transit procedure or leaving the customs territory of the Community

temporarily.

Non-Community goods

Non-Community goods destined to leave the customs territory of the Community shall be subject to a re-export notification which is lodged at the competent customs office and to the exit formalities.

This regulation shall not apply to the following goods:

•goods placed under the external transit procedure which only pass through the customs territory of the Community;

•goods trans-shipped within, or directly re-exported from, a free zone;

•goods under the temporary storage procedure which are directly re-exported from an authorised temporary storage facility.

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2g. Reading

Match the names of the UK customs procedures given in the box to the explanations below.

Import procedures

1.Customs duty and import VAT is paid and goods are removed from customs control; some goods may be subject to import licences and policy measures.

2.It enables goods to be stored without payment of import duty or VAT until released for free circulation or placed under another customs procedure.

3.It enables goods to be stored and processed without payment of import duty or VAT.

4.It allows conditional relief from duty on imported materials and components for use in manufacture of products for export; under IPR suspension duty is suspended while under IPR drawback duty is paid and later reclaimed.

5.It allows specific dutiable components and materials to be imported without payment of duty, processed into finished products and released for free circulation at the duty rate of the finished good

–this rate may be lower than the rate of the components and materials used in the production process.

6.It gives relief from duty for goods imported for a given period of time – maximum 24 months – and re-exported in the same state.

7.It allows relief on re-importation of goods previously exported.

8.Reduced/zero duty rates for goods intended for specified end use.

9.Goods are re-exported, destroyed or otherwise disposed of without payment of duty.

Export procedures

1.Goods leaving the EC may be subject to licensing requirements, export duties, and commercial policy measures.

2.It allows relief from duty on EC goods re-imported after repair or process abroad.

3.An EC customs procedure which controls and facilitates the movement of certain goods from one part of the EC to another , delaying duty and VAT payment.

4.It may be used to simplify customs clearance of temporarily exported goods; the carnet replaces normal customs documents both at export and re-import.

5.Subject to certain conditions, it allows goods to travel across national frontiers with the minimum of customs formalities, duty and VAT free.

Unit 5. The Harmonised Commodity Description and Coding System

1.The International Product Nomenclature

1a. Discussion

1.What international organisation was the Harmonised System (HS) developed by?

2.What is it used for?

3.Is it the same in all countries?

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1b. Reading

Read the text about the HS and see if your ideas were correct.

What is the Harmonised System?

The Harmonised Commodity Description and Coding System generally referred to as “Harmonised System” or simply “HS” is a multipurpose international product nomenclature developed by the World Customs Organisation (WCO).

It comprises about 5,000 commodity groups, each identified by a six digit code, arranged in a legal and logical structure and supported by well-defined rules to achieve uniform classification. The system is used by more than 200 countries and economies as a basis for their customs tariffs and for the collection of international trade statistics. Over 98 % of the merchandise in international trade is classified in terms of the HS.

The HS contributes to the harmonisation of customs and trade procedures, and the non-documentary trade data interchange in connection with such procedures, thus reducing the costs related to international trade.

It is also extensively used by governments, international organisations, and the private sector for many other purposes such as internal taxes, trade policies, monitoring of controlled goods, rules of origin, freight tariffs, transport statistics, price monitoring, quota controls, compilation of national accounts, and economic research and analysis. The HS is thus a universal economic language and code for goods, and an indispensable tool for international trade.

The Harmonised System is governed by the International Convention on the Harmonised Commodity Description and Coding System. The official interpretation of the HS is given in the Explanatory Notes (5 volumes in English and French) published by the WCO.

The maintenance of the HS is a WCO priority. This activity includes measures to secure uniform interpretation of the HS and its periodic updating in light of developments in technology and changes in trade patterns. The WCO manages this process through the Harmonised System Committee (representing the Contracting Parties to the HS Convention), which examines policy matters, takes decisions on classification questions, settles disputes, and prepares amendments to the Explanatory Notes. The HS Committee also prepares amendments updating the HS every 5–6 years.

Decisions concerning the interpretation and application of the Harmonised System, such as classification decisions and amendments to the Explanatory Notes or to the Compendium of Classification Opinions, become effective two months after the approval by the HS Committee. These are reflected in the amending supplements of the relevant WCO Publications.

1c. Vocabulary

Find English equivalents of the following in the text:

гармонизированная система описания и кодирования товаров; товарная номенклатура; шестизначный цифровой код; сбор статистических данных в масштабе страны; важный, необходимый инструмент; примечания, пояснения; поддержание, сохранение в силе; периодическое обновление; схемы, применяемые в торговле; поправка; сборник, справочник;

приложение с поправками.

1d. Comprehension

Answer the questions on the text:

1.What principle of classifying goods has been used in developing the Harmonised System?

2.In what areas is it applied?

3.What agreement governs the HS?

4.How is the Harmonised System kept up-to-date?

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