Treatment of ship supply under European Customs legislation
European ship supply is greatly affected by European Customs legislation. This is because of the specialized nature of the ship supply operations. In this section we outline the rationale for treating shipsupply as an export operation and cite key European legislation.
Fundamental principle of ship supply
Goods delivered onboard a vessel are being used and consumed exclusively within that vessel during the entire voyage of that vessel. These goods are not destined to be imported into another country nor transported by other means of transport through it. In other words, once onboard, they never leave the vessel again.
Shipsupply = Export
Goods designated as ship supply have left the EU once they have been loaded onboard of a vessel which is bound for another country. The vessel is considered to be similar to a “third country” regardless its origin or destination. As a consequence, ship supply is an export operation. This concept is recognised by COMMISSION REGULATION (EU) No 430/2010 of 20 May 2010 amending Regulation (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code. In this regulation, the EU clarifies that the export formalities are to be used with regard to ship supplies so that persons delivering such supplies can receive a proof of exit from the customs territory of the Community needed for the purposes of tax exemption under the new EMCS system. Without this, the computerisation of the excise duties system could have had serious consequences for ship suppliers in some Member States. The European Commission clarified that the same rules apply where non-Community goods are to be re-exported under cover of a re-export declaration. This is spelled out in Article 786.
Meeting at the European Parliament
On November 5th 2009, OCEAN presented its views to the Members of the European Parliament and the Director of Customs Policy of the European Commission.
SPEECH: What is OCEAN? by OCEAN President Stefan Ericson
SPEECH: EU Policy Requirements for Ship Suppliers by ISSA President Jens Olsen
Implementing Provisions of the Modernised Customs Code
OCEAN advocates transposing current EU legislation (including the latest amendement of the CCCIPs) into the Implementing Provisions of the Modernised Customs Code by 2013.
Ship supply & security
The safety and security related deadlines for export declarations do not apply for ship supplies, it should be possible for the customs authorities to authorise reliable economic operators to enter the goods exported in their records and to report their export operations on a periodic basis after the goods have left the customs territory of the Community.Given the nature of our operation, ship suppliers are exempted to lodge a pre-departure declaration.
Entry into records
Regulation 430/2010 states that it should be possible for the customs authorities to authorise reliable ships suppliers to enter the goods exported in their records and to report their export operations on a periodic basis after the goods have left the customs territory of the Community. The word "reliable" is NOT defined as meaning to meet the requirements of being an "AEO". - which is a voluntary system. In the case of entry of the goods in the records, the act of entering goods into records shall be deemed to be release for export and exit. This is an important simplification for ship suppliers and might also resolve problems related to the insufficient opening hours of customs offices in Europe. OCEAN urges all customs authorities to allow for this simplification without delay and minimising administrative burden.
There is Regulation (EEC) No 2913/92 establishing the Community Customs Code. European Regulations become immediately enforceable as law in all member states simultaneously. Regulation (EEC) No 2454/93 provides the provisions for the implementation of this regulation. Most recently, European ship supply has been mentioned in the so-called ”Security Amendment” of the Customs Code (Regulation (EC) No 648/2005) of which the Implementing provisions are spelled out in Regulation (EC) No 1875/2006. These have been further amended by Regulation (EC) No 312/2009, and Regulation (EC) No 414/2009. Moreover, until 1st January 2011, a transitional period is in place Commission derogating from certain provisions of the implementing provisions. This is Regulation (EC) No 273/2009 of 2 April 2009. Provisions for ship supply can also be found in guidelines and explanatory notes issued by the European Commission.
An brief overview of the key articles is given below:
Not only exports - Imports and transit traffic also matters!
The relevance of the export procedure for ship supply has already been pointed out and it’s unique status in terms of special trade conditions and legal interpretation.
Less understood is the fact that imports are also relevant for ship supply even though transit traffic is the most common form of trade for ship supply. This is because a Ship Supplier removes goods no longer used on board, faulty goods for repair or spare parts for storage. For instance, inflatable lifeboats on vessels have to be regularly inspected. Ship Suppliers therefore have to land them, bring them back to their company for inspection and deliver them back on board during the short time period that the vessel is in port. This can also take the form of an import operation.
Nevertheless, and more than ever, transit traffic is the basic condition for international trade in general and especially for ship supplying. Ship supply is a world-wide international business and it is normal for foreign ships to require technical stores and food stuffs from their homeland to be delivered in transit. Frequently, goods from one country are delivered by Ship Suppliers from a second country to ships in a third country. If necessary such goods can be temporarily stored in a Bonded Warehouse for delivery at the right time to ship. Customs and other authorities should control transit traffic only to the extent of ensuring such traffic is not used for purposes other than intended. However, the non-interference with transit and transit traffic deliveries on sea going ships is a basic condition for smooth ship supplying.
Freeports and Bonded Warehouses
Ship Suppliers use public and private bonded warehouses. In principle free ports and bonded warehouses have the same function, although Free Ports have advantages because customs control is mainly at Entry or Exit of the Free Port, and ships can be supplied in the free Port without further systematic customs control. Supervision of private bonded warehouses is exercised by Customs officials checking every input and delivery from the warehouse. Regulations for bonded warehouses are laid down by custom authorities. In a number of cases, deliveries from private Bonded warehouses are only permitted for supplies to ships. Regulations for bonded warehouses and Free Ports differ in many countries and even in different port areas of the same country. Sometimes only limited categories of goods may be put into bonded warehouses.
Documents for Download:
COMMISSION REGULATION (EC) No 1875/2006 of 18 December 2006
amending Regulation (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code
COMMISSION REGULATION (EC) No 312/2009 of 16 April 2009 amending Regulation (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code
Guidelines on export and exit in the context of Regulation (EC) No 648/2005 (Rev 3)
For more information, we recommend visiting the relevant webpage of DG TAXUD at http://ec.europa.eu/taxation_customs/customs/security_amendment...
Power Point Presentation: The European Commission and EU Member States visit Ship Supply companies in Genoa, Italy (orgnised by ANPAN & OCEAN)