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Customs and excise duty (Tax Alert - 3/2013)

Latest changes

Changes in excise duty regulations 2013

Certain amendments to secondary legislation to the Excise Duty Act as well as regulations that change the currently binding regulations have been published in the Journal of Laws lately.  Let us have a look at the upcoming changes.

  • New Regulation of 08 February 2013 on excise duty exemptions and Regulation of 08 February 2013 on the conditions of applying certain excise duty exemptions.  


The changes introduced by  the above Regulations primarily consist in moving the rules on additional conditions of applying certain excise duty exemptions and the situations where the statutory conditions do not need to be met to apply excise duty exemptions from  the Regulation on excise duty exemptions to the new Regulation on the conditions of applying certain excise duty exemptions.          The new Regulation was prepared on the basis of the old Regulation on excise duty exemptions.  The changes are of a technical and legislative nature and they do not affect the application of the provisions contained in chapter 2 of the hitherto binding Regulation of the Minister of Finance dated 23 August 2010 on excise duty exemptions.


Additionally, the new Regulation on exemptions includes provisions defining the competence of tax authorities for foreign staff of the Headquarters of Multinational Corps Northeast and the armed forces of the United States.  


The Regulation on the conditions of applying certain excise duty exemptions covers the provisions above as well as exclusion - for the needs of excise duty exemption – of the obligation to attach the supply document to a single movement of coal products up to 200 kilograms.   
The new rules come into force on 01 March 2013.

  • Regulation of the Minister of Finance of 07 February 2013 amending the Regulation on certain registers of excise goods    


The amendments introduce a more precise definition of closing and summary of the register, as referred to in the Regulation.   According to the new rules the monthly closing and summary of the register ought to be made not later than within three days of the last day of each month.
Furthermore, the entrepreneurs who keep the register electronically  are no longer obliged to transfer the monthly reports of register closing and summary  to the head of the customs office.  As from 01 March 2013 generally such reports should be transferred for annual periods by the end of January of the year following the year covered by the report.    The head of the customs office will be able to call the entity to produce the relevant report.  
The changes above come into force on 05 March 2013.

  • Regulation of the Minister of Finance of 07 February 2013 on the conditions of conducting bonded warehouses and the keeping of registers by entities running bonded warehouses.


The Regulation introduces a more precise definition of closing and summary of the register of the bonded warehouse. According to the new provisions the closing and summary of the register ought to be made not later than within three days of the last day of each month. Furthermore, the entrepreneurs who keep the register electronically are no longer obliged to transfer the closing and summary monthly reports in respect of bonded warehouses. As per the new regulations, generally such reports should be transferred for annual periods, by the end of January of the year following the year covered by the report. The head of the customs office will be entitled to call the entity to produce the relevant report.
In addition, an obligation has been introduced to provide daily reports on information concerning antiknock agents and additions to other lubricating oils.     
The changes above come into force on 05 March 2013.

If you would like to receive detailed information on the new secondary legislation, please contact our specialists.


Free Trade Agreements between EU and Columbia, Peru and Central America will soon become effective.  Talks about a free trade agreement between EU and the US have started.    

On 11 December 2012 The European Parliament supported ratification of two free trade agreements (FTAs) signed by the EU and: 

  • Columbia and Peru, and
  • Central American countries (Costa Rica, Salvador, Guatemala, Honduras, Nicaragua and Panama) – this is the first inter-regional agreement of that kind.  

The negotiations in respect of both agreements above were finalized in 2011 and the texts of the agreements were signed in June 2012.  Then the ratification process commenced and it lasted until now. The consent given by the European Parliament rounds up the EU ratification steps.   Now we are waiting for the ratification processes to end in Latin American countries.
The European Commission expects that the key provisions of both agreements will come into force during the first months of 2013, after the agreements are ratified by Latin American partners.     Potentially, the FTA with Columbia and Peru will become binding in the first quarter of 2013, while the FTA with Central American countries  will take effect in the second quarter this year.  
It should also be stressed that recently, in the joint statement, the President of the US, the President of the European Commission and the European Council President expressed their willingness to engage in negotiations on Transatlantic Trade and Investment Partnership.     The Partnership is aimed at achieving further liberalization of trade between EU and the US, removal of the existing barriers and administrative differences that hamper cooperation between the EU and the US.  

The above FTAs may have a significant impact on commercial exchange with partners form the countries covered by the agreements.     As a rule, such agreements eliminate or reduce the customs duties and other barriers to trading in a wide range of products.   This opens up new opportunities to obtain significant savings in importation and exportation by companies domiciled in the FTA countries, providing they know how to take advantage of the new rules.    To be eligible for the preferential treatment, the company needs to fulfil the criteria set in FTAs, mainly in respect of definition of the customs origin of goods in accordance with the rules introduced in the relevant agreements and adherence to the attendant documentation requirements (especially in respect of confirmation  of the customs origin of goods).  

 
Mutual recognition of C-TPAT and AEO certificates in trading between the US and EU  

The Agreement between the US and EU in respect of mutual recognition of C-TPAT and AEO came into effect at the end of January 2013.
The Agreement is sure to streamline the trade between the US and EU, and contribute to limitation of administrative formalities to be fulfilled by the entrepreneurs involved.  Now there is yet another argument in favour of holding the AEO certificate.   In particular, the Agreement stipulates that an entity with the AEO certificate will obtain the C-TPAT partner status in the American market - hence, an entity obtaining the AEO certificate in Europe will be able to take advantage of all benefits associated C-TPAT partnership.   The goods imported to the US by entities functioning as C-TPAT partners enjoy preferential treatment, e.g. the American customs administration rarely controls them and their goods receive priority treatment over the goods imported by non-C-TPAT partners.    In addition, the C-TPAT partner status is considered prestigious in the American market and considerably strengthens the image of the brand as a trusted and safe business partner.  
It must be noted that the agreement’s focus is primarily on the aspects linked with the safety of international trading and therefore, it covers the entities holding Security and safety AEO status.

    
Customs classification of denatured ethyl alcohol

On January 26th, 2013, the Commission Implementing Regulation (EU) No.70/2013 of 23 January 2013 (Dz. U. L 26) was announced. The Regulation is aimed to ensure uniform application of the Combined Nomenclature to goods being the mixture of ethanol and ETBE (ethyl tertiary butyl ether).   In accordance with the Regulation, a mixture with the following its composition (by weight): 90% of ethyl alcohol and 10% ETBE should be classified as denatured ethyl alcohol (CN 2207 20 00). This classification means that such mixtures can no longer be treated as chemical preparations (CN 3824).  
In consequence, they will be subject to much higher customs duty – i.e. the duty for denatured ethanol – currently  max. 102 EUR/m3.
If you are engaged in importation of denatured alcohol (composed of ethanol and other substances that make it unfit for human consumption) currently classified to CN 3824, the customs authorities are likely to question this classification and impose a much higher customs rate, i.e. the one applicable to CN 2207. Please take into account that the customs authorities are entitled to impose the higher customs rate retroactively, also on the goods already admitted to trading. To mitigate this risk, you may consider reviewing the classification of the imported ethanol mixtures.   Additionally, to confirm correctness of the classification applied and safeguard the importer’s position in case of a dispute with the customs authorities, you may contemplate the option of applying for a binding tariff information (BTI).    


If you would like to get support in determining the appropriate customs classification of the imported goods or you wish to obtain assistance in applying for binding tariff information, please contact Deloitte specialists.

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