Committee Reports > List of Committees > Joint > 1979 > Committee on the Secondary Legislation of the European Communities > Report No. 62 - Customs Declarations

REPORT

Introduction

1. The Joint Committee has considered the proposal made by the Commission for a Council Regulation defining the conditions under which a person may be permitted to make a customs declaration (4372/79). The proposal is based on Article 235 of the EEC Treaty under which the Council, acting unanimously on a proposal from the Commission and after consulting the Parliament, may take appropriate measures “if action by the Community should prove necessary to attain, in the course of the operation of the common market, one of the objectives of the Community and this Treaty has not provided the necessary powers.”

2. A detailed examination of the Commission’s proposal was carried out for the Joint Committee by its Sub-Committee on Economic, Commercial and Financial Affairs under the Chairmanship of Senator Noel Mulcahy. The Joint Committee is indebted to Senator Mulcahy and his Sub-Committee for their work. The Sub-Committee consulted the Revenue Commissioners, the Confederation of Irish Industry and the Institute of Freight Forwarders of Ieland.

3. The rules as to who is entitled to make a customs declaration when goods are to be placed under a customs procedure vary from one Member State to another and in the Commission’s view this situation is not compatible with the proper operation of the customs union. Some Member States allow customs declarations to be made in one’s own name on behalf of another person or in the name or on behalf of another person. In other Member States the right is reserved to declarants approved by the customs authorities. The Commission argues that the latter practice involves the firms concerned in higher extra-administrative costs than those incurred by their competitors in other Member States who may be represented for customs clearance purposes by employees or other agents of their own choice. As these costs affect the price of goods they distort the conditions of competition and the Commission believes that common rules must, therefore, be established to replace the varying national rules.

Commission’s Proposal

4. The proposed Regulation would allow a customs declaration to be made by any natural or legal person able to produce the goods and all the necessary documents to the customs authorities. The declarant would be permitted to act (a) in his own name and on his own behalf or (b) in his own name but on behalf of another or (c) in the name and on behalf of another, subject to the customs authorities being satisfied as to the precise legal capacity in which he is making the declaration. The draft Regulation provides that the declarant must be domiciled in the Community except where he is a person declaring goods on an occasional basis in his own name and on his own behalf. The right to make a declaration on behalf of another could be withdrawn from anyone guilty of serious or repeated offences in this or related fields.

Implications for Ireland

5. The Committee is informed that at present in Ireland the practice is that

(a) a citizen of another State may clear goods being imported here provided he is either domiciled in the State or has a place of business in the State. He may also clear goods being imported if he is both the consignor of the goods and the importer into Ireland, and

(b) any of the following may act as agent for the purpose of making customs entry:—

(i) a person domiciled in Ireland; or

(ii) a private firm having a place of business in Ireland; or

(iii) a company registered in Ireland; or

(iv) a company incorporated outside the State which has a place of business in the State and has filed the required particulars under Section 352 of the Companies Act, 1963.

6. If the proposed Regulation were adopted Ireland would be obliged to permit customs entries to be presented by any person (instead of only the importer or his agent, as at present), who is able to produce the goods and documents to the customs: and such person need only be domiciled in the Community, and not in this country, as at present. The Committee is advised that the adoption of the proposed Regulation would probably require some amendment of existing legislation here to enable its provisions to have full effect.

Views of Bodies Consulted

7. The Confederation of Irish Industry regards the proposed Regulation as being generally in line with our current situation and as calling for no particular comment.

8. The Institute of Freight Forwarders of Ireland which is a member of the European Liaison Committee of Common Market Forwarders does not favour “adoption by the European Community of the ‘free for all’ situation that has existed in these islands over the past 118 years.” It argues that “freedom can beget irresponsible and careless documentation”, a feature that “has been increasingly in evidence with the growth in roll-on/ roll-off traffic’s use of the Border in this country”. It would favour “some form of regulation in operation that would respect the legal and other rights of each Member State in its detention and release arrangements where international movements of merchandise are concerned, and ensure that documentation for customs and other purposes is responsibly completed and accountable by way of Community registration, or licensing, of all making declarations on behalf of third parties.”.

Decision of Court of Justice

9. A recent decision of the European Court of Justice is relevant to the proposal. The case (159/78) concerned an action by the Commission against the Italian Republic for failure to fulfil Treaty obligations. The facts of the case are as follows.

10. Under the Italian customs law the customs declaration in respect of goods which are to be imported or exported and the other customs transactions must be carried out by the owner of the goods. The law, however, authorises the owner to “act through an agent” who must be either a customs agent whose name appears on the professional register or an agent whose name is not entered on the register if he is an employee of the owner. The name of the employee agent is entered on an ad hoc list kept by the competent local committee of the professional customs agents. The status of customs agent is conferred, for both types of agent, by a licence issued by the Minister for Finance on condition in particular that the applicant passes an examination. A customs agent must have his residence in a commune included in the district for which he has been appointed. It is also provided that the licence for a customs agent shall be issued, without prejudice to the other necessary conditions, to Italian citizens or citizens of a foreign country that grants equal treatment in the matter to Italian citizens.

11. The Commission contended that the Italian law infringed Articles 30 and 34 of the EEC Treaty which prohibit measures equivalent to quantitative restrictions on imports and exports and also Article 52 which provides for the abolition of restrictions on the freedom of establishment of nationals of a Member State in the territory of another Member State.

12. The Court rejected the Commission’s action insofar as it concerned failure to observe the obligations imposed by Articles 30 and 34. It ruled that the distinction drawn by a national authority between the rules relating to the liability of persons engaged in an occupation which is regulated and subject to requirements relating to professional qualifications and those applied to persons submitting customs declarations who did not satisfy such conditions cannot be regarded as going beyond what a government may treat as justified in order to ensure the correct application of the obligations relating to customs declarations. Furthermore it held that the Commission had failed to show in what manner that distinction is capable of constituting even a potential barrier to the free movement of goods.

13. However, insofar as the provision for the issue of licences to non-nationals is concerned the Court held that as Italian law did not provide for an exception in respect of nationals of other Member States regarding the condition of reciprocity, the Italian Republic had failed to fulfil its obligations under Article 52 of the EEC Treaty.

Views of the Joint Committee

14. In the Joint Committee’s opinion Ireland could have no valid objection to the adoption of the proposed Regulation since it is broadly in line with current practice in this country. However, the proposal will now presumably have to be re-examined in light of the ruling of the Court. In general the Committee’s view is that customs procedures should be as uncomplicated as protection of the revenue permits and it would favour that approach being followed in any Regulation that may eventually emerge.

Acknowledgements

15. The Joint Committee wishes to thank the Confederation of Irish Industry and the Institute of Freight Forwarders of Ireland for their help in considering this matter.

(Signed) ALEXIS FITZGERALD,

Chairman of the Joint Committee.

19th December, 1979.