United Kingdom Export: Special Provisions
Due to Brexit, the information contained in this article may not be accurate. As more information becomes available, this content will be updated.
Freeports
The United Kingdom has multiple freeports. They include:
- East Midlands Airport
- Felixstowe and Harwich, including the Port of Felixstowe and Harwich International Port
- Humber, including parts of Port of Immingham
- Liverpool City Region, including the Port of Liverpool
- Plymouth and South Devon, including the Port of Plymouth
- Solent, including the ports of Southampton and Portsmouth as well as Portsmouth International Port
- Teesside, including Teesside International Airport, Port of Middlesbrough, and Port of Hartlepool
- Thames, including the ports at London Gateway and Tilbury
Freeports are special areas within the UK’s borders where different economic regulations apply. Freeports in England are centered around one or more air, rail, or seaport, but can extend up to 45 kilometers beyond the port(s).
The UK's model for freeports includes a comprehensive package of measures, comprising tax reliefs, customs, business rates retention, planning, regeneration, innovation, and trade and investment support. Eligible businesses in freeports enjoy a range of tax incentives, such as enhanced capital allowances, relief from stamp duty, and employer national insurance contributions for additional employees. These tax reliefs are designed to encourage the maximum number of businesses to open, expand, and invest in freeports which in turn will boost employment.
Businesses using freeports benefit from a range of customs measures that delay paying tariffs and allow imports to enter the freeport custom sites with simplified customs documentation. This means that businesses operating inside designated areas in and around the port may manufacture goods using these imports, before exporting them again without paying the tariffs and benefit from simplified customs procedures.
Freeports provide a supportive planning environment for the development of tax and customs sites through an extension of permitted development rights and incentivizing use of local development orders. The government also supports freeports with innovation as all businesses within freeports have access to direct engagement with relevant regulators including the Freeport Regulation Engagement Network (FREN).
The government remains committed to establishing at least one freeport in each of Scotland, Wales, and Northern Ireland as soon as possible. Additional information on the UK's freeports is available online at www.gov.uk/guidance/freeports.
Customs Handling of Import and Export Freight (CHIEF)
Customs Handling of Import and Export Freight (CHIEF) is a customs data system that facilitates import and export processing and allows traders direct access to essential information and customs processing. Among the functions traders may access through CHIEF are:
- Direct high-speed communication links to customs offices throughout the UK
- Tracking the movement of goods within ports and airports
- Calculation of duties and recording of payments
- Automatic clearance of consignments
- Currency conversions
- Immediate checking and validation of data submitted for import processing
- Identification of goods subject to examination
As of March 31, 2023, the UK's CHIEF system will be replaced by its Customs Declaration Service (CDS), the government's new electronic system for handling customs declaration processes. HMRC is implementing the system transition from CHIEF to CDS in several stages, with final deadlines for import declarations in September 2022 and export declarations in March 2023. For more information on CHIEF and to apply for access, visit www.gov.uk/guidance/apply-to-access-customs-handling-of-import-and-export-freight-c1800.
Goods Vehicle Movement Service (GVMS)
Effective as of January 1, 2022, Goods Vehicle Movement Service (GVMS) is a web-based platform in place for all imports and exports at Great Britain (GB) port locations that have chosen to use it. Connected to CHIEF and providing electronic notification of shipment status, the GVMS is available at certain ports for faster clearance of goods with pre-lodged declarations.
GVMS links Movement Reference Numbers (MRN) for all pre-lodged declarations in a shipment to a single Goods Movement Reference (GMR) that specifies the truck/trailer license plate. Each GMR contains details for a single crossing by one vehicle and can be used only once. The hauler only needs to present the GMR to the carrier at the frontier to prove that all of their goods have pre-lodged declarations.
GVMS can also be used for digital Offices of Transit. Transit regulations require that goods be presented at the customs Office of Transit at the border when a transit shipment enters a country. GVMS-linked ports provide the Office of Transit function digitally. This means that lorries do not need to pass physically via an Office of Transit.
In order to move goods through GVMS ports, the person or business responsible for moving the goods must first register for the GVMS with HMRC. This will require a Government Gateway User ID and GB EORI number. To register, visit www.gov.uk/guidance/register-for-the-goods-vehicle-movement-service.
Obtaining a Goods Movement Reference (GMR)
Traders must obtain a Goods Movement Reference (GMR) for each shipment. The GMR is a unique identifier issued by HMRC to identify the record. Depending on whether a movement is import, export, or transit, there are different requirements to get a GMR. For more information and to obtain a GMR, visit www.gov.uk/guidance/get-a-goods-movement-reference.
The GMR specifies:
- The direction of the crossing
- The registration number of the vehicle making the crossing (unless the movement will be unaccompanied)
- The trailer numbers of all trailers attached to the vehicle
- Details of the planned crossing, if available, including the departure and arrival port, carrier, and departure time
- Whether the vehicle arriving at check-in will accompany the movement on the crossing
- MRN for all goods within the vehicle and its trailers that require them
- Safety and security declaration references for all goods within the vehicle and its trailers that require them
- Transit declaration references for all goods within the vehicle and its trailers that require them
- EIDR, ATA, and TIR declaration references
How GVMS Works
Upon check-in at the port, the carrier will use GVMS to verify the GMR presented to them and cross-check the details on the GMR with the vehicle. Vehicles will be turned away at check-in if a valid GMR cannot be presented or if their registration number(s) do not match those on the GMR.
GVMS allows for automatic arrival in CHIEF as soon as goods board at the EU side so that UK import declarations can be processed by HMRC en route to the UK. Once the vehicle and/or trailers have embarked on the crossing, the status in GVMS will be updated to EMBARK. The platform sends an electronic notification through CHIEF when inbound goods are successfully cleared before they arrive in the UK, allowing them to quickly pass through customs.
If the GVMS determines that the movement requires inspection, a notification will be sent within 30 minutes after embarkation. Those vehicles must report to a customs inspection center upon arrival, where customs officials will update GVMS once the property has been cleared.
For transit shipments, the transit declaration will be automatically updated in NCTS on the basis of the TAD data entered in GVMS prior to departure in the EU. In order for this to work, the hauler/transport companies must receive the TAD/MRN from the trader and input the data in GVMS along with the license plate number of truck/trailer. Transit movements do not require a Community Systems Provider (CSP) or CHIEF badge, however an NCTS UK badge is required to end the transit movement.
A list of ports using GVMS is available online at www.gov.uk/guidance/list-of-ports-using-the-goods-vehicle-movement-service.
International Road Transport (Transports Internationaux Routiers) or TIR Convention
Administered by the United Nations Economic Commission for Europe (UNECE), the International Road Transport (Transports Internationaux Routiers) or TIR Convention is a multilateral treaty created on November 14, 1975, to simplify and harmonize the administrative formalities of international road transport. The 1975 convention replaced the TIR Convention of 1959, which itself replaced the 1949 TIR Agreement. With more than 50 countries using the procedure, the TIR system is the international customs transit system with the widest geographical coverage. A handbook on using TIR Carnets is available from the UNECE at www.unece.org/DAM/tir/handbook/english/newtirhand/TIR-6Rev11e.pdf.
As with other customs transit procedures, the TIR system enables goods to move under customs control across international borders without the payment of the duties and taxes that would normally be due at importation (or exportation). A condition of the TIR procedure is that the movement of the goods must include transport by road.
Goods move from a customs office of departure in one country to a customs office of destination in another country under cover of an internationally accepted customs transit document, the TIR Carnet, which also provides a financial guarantee for the payment of the suspended duties and taxes. The guarantee system is managed by the International Road Transport Union or IRU (www.iru.org).
The IRU's TIR-EPD (https://tirepd.iru.org) is an electronic application that enables TIR Carnet holders to submit electronic pre-declarations (EPD) to customs authorities in different countries. With TIR-EPD, customs authorities are able to confirm that the pre-declaration was submitted by an authorized TIR Carnet holder and that the TIR Carnet is valid. This exchange of advance information facilitates pre-arrival risk analysis and makes border crossings simpler, safer, and faster. A TIR-EPD user guide is available at www.iru.org/system/files/TIR-EPD%20User%20Guide%20ENG.pdf.
Carnet de Passage en Douane (CPD)
A Carnet de Passage en Douane (CPD) allows a UK-registered vehicle to be taken into certain countries temporarily. A CPD covers the following vehicles:
- Road motor vehicles
- Motorcycles
- Trailers
- Registered motor sport vehicles transported by trailer
More information on the CPD is available online at www.gov.uk/guidance/apply-for-a-cpd-carnet.
New Computerized Transit System (NCTS)
The New Computerized Transit System (NCTS) is a computerized transit system based on an exchange of electronic messages. The first fully computerized customs system, the NCTS is available to all EU and European Free Trade Association (EFTA) countries as well as the UK, Turkey, and North Macedonia. It replaces the various paper documents and certain formalities now required by customs offices, and will apply to both internal (EU) transit and external transit, regardless of the mode of transit (with the exception of simplified transit procedures where a commercial document serves as the transit declaration).
The NCTS tracks goods at certain points along their route:
- Customs office of departure
- Customs office of destination
- Customs office of transit (the customs office at the point of entry or exit to or from the customs territory of the UK)
It is also noted when a change in the customs office of transit or destination is made.
UK Export Finance (UKEF)
For UK exporters of certain goods and services to overseas markets, UK Export Finance (UKEF)—also known as the Export Credits Guarantee Department (ECGD)—provides export credit insurance. UKEF is the country's official export credit agency. Coverage protects exporters from political risks and non-payment by purchasers.
Authorized Economic Operator (AEO)
Authorized Economic Operator (AEO) programs, implemented by an increasing number of customs administrations throughout the world, are based on the customs-to-business partnership introduced by the World Customs Organization or WCO (www.wcoomd.org). The voluntary AEO scheme creates customs-to-business partnerships aimed at securing the supply chain and facilitating legitimate low-risk trade. AEO are examined at the border significantly less than regular cross-border traders.
AEO status can be granted by participating countries to any established economic operator that meets criteria in the following categories: customs compliance, appropriate record-keeping, financial solvency, and where relevant, security and safety standards. AEO status granted by one European Union (EU) member state is recognized by other members.
The application for AEO status is submitted through participating customs agencies. Economic operators can apply for AEO status to have easier access to customs simplifications and make it easier to comply with new security requirements.
Additional information on the UK's AEO program is available online at www.gov.uk/guidance/authorised-economic-operator-certification?step-by-step-nav=849f71d1-f290-4a8e-9458-add936efefc5. For detailed information on the implementation of AEO programs worldwide, consult the WCO's AEO compendium at www.wcoomd.org/-/media/wco/public/global/pdf/topics/facilitation/instruments- and-tools / tools / safe-package / aeo-compendium.pdf.
Mutual Recognition of AEO
Mutual recognition of AEO is a key element of the WCO's Standards to Secure and Facilitate Global Trade (SAFE Framework). The 2021 version of the SAFE Framework strengthens cooperation between customs and other government agencies; promotes smart security devices to optimize customs control and effectively monitor the movement of goods in a real-time basis; and includes baseline provisions on the development of AEO programs and implementation of mutual recognition.
By mutual recognition of AEO, two customs administrations agree to:
- Recognize the AEO authorization issued under the other program
- Provide reciprocal benefits to AEO of the other program
The EU has mutual recognition of AEO programs with Norway, Switzerland, Japan, Andorra, the United States, and China. In addition, the EU and WCO are helping prepare a number of other countries to implement AEO programs.
Note: The above information is subject to change. Exporters are advised to obtain the most current information from a customs broker, freight forwarder, or the local customs authorities.
Sources: Her Majesty’s Revenue and Customs or HMRC (www.gov.uk/government/organisations/hm-revenue-customs/services-information); US Department of State (www.state.gov); United Nations Treaty Collection (https://treaties.un.org)
Article written for World Trade Press by Brielle Burt, Jennifer Goheen, and Nina Bellucci.
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