wca ecommerce cross border compliance

Cross Border Compliance

WCA eCommerce NetworkWebinar 28 NOV 16

Cross Border ComplianceEU & UK

Host: Alex Allen, Managing Director WCA eCommerce

Guest: Mr Klaas Gijzen – IAA Group – Netherlands

Guest: Mr Neo Xiaoning Kong – CCL – UK

Welcome & Webinar FormatTopic: Alex will lead discussion with Guests Speakers through a series of questions relating to the challenges with EU & UK Cross Border Compliance for Shippers and Logistics Providers.

Questions: Webinar Participants are invited to send through any questions via the Chat function, which may be addressed at the end of the session if time allows.

Duration: 60 minutes

Copy of Presentation will be available to download www.wcaecommerce.com shortly.

EU: eCommerce

Customs Definition: e-Commerce

All transactions created electronically

through a computer network (eg.the

Internet) that result in a movement of

physical goods and are subject to

customs formalities and regulatory

compliance.

2.5bn

78.9 bn

1.5 bn

5.8bn

28.7bn

69.5 bn

14.5 bn

111.1 bn

2.4bn

9.8 bn

17.5 bn

6.9bn

2019

LogisticseCommerceMarket SizeEuro 348.9 billionTi – Transport Intelligence 2016

China + India + SE Asia = 50% of Global Market Share

eCom: Hotspots

Online Economy

50% - 80% purchased online in

past month

CHANGED BUYING BEHAVIOURS

- 2015 B2C 477billion € growth of 12.5%

- B2C sector has created 2.5 million jobs

in Europe (2015)

- UK eCommerce B2C growing at 14.7% ,

127billion € 2013/14

- Ecommerce sales in Europe increased

18.4% in 2015

- Predicting European eGDP to reach 6%

in 2020

EU: eCommerce

EU: eCommerceCustoms Declarations e-Commerce EU (from 01 May 2016): Standard Declaration in regular system AGSDeclaration in advance in regular system AGSDeclaration via separate automated tool : Venue Already used by express carriers and Post.nl, also possible for other companies.

Note: For each eCommerce Customer/ Invoice must be made a Customs Declaration.1. Custom clearance can be done when goods arrived at EU bonded warehouse. 2. Custom clearance can be done in advance. 3. Possibility of doing Venue declaration will end 2019.

EU: CustomsCustoms Declarations

Customs Declaration for each eCommerce Invoice - Manual declaration is not an option - IT solution / data transfer

Issues: - Hs codes - Value - Duties - Vat/ Value Added Taxes - Incoterms DDP - EU Customs Regulations, Dangerous Goods etc. Custom Clearance in Advance:

Advantage : Possibility for AEO status holders of selection of physical inspection customs before actual arrival of the goods in EU (Pilot phase will be starting approximately april 2017)

Disadvantage: Missing cargo & non-manifested cargo

EU: CustomsEU’s 8 digit HS number, plus 2 additional digits for Integrated Tariff Code (TARIC)

- eCommerce Vendor standards for must be the same as EU standards - Mapping must be done according EU Customs regulations.

Value: The value of the goods must be the actually charged or paid price of goods.

Customs value:The value of the goods added with the cost of transportation to the EU.

Below is a simplified Version of Duties / VAT calculations

0,- until 22,- € duty no /Vat no 22,- until 150,- € duty no / Vat yes 150,- > € duty yes/ Vat yes

Penalties for under-declared value & incomplete documentation. Transport Insurance a must.

EU: VATPayments

Destination NL: pay VAT in NLDestination other EU member state: distance selling Amounts of VAT are not the same in the other member EU StatesDistance selling has to be done by a Importer in NL/EU

Incoterms DDPProhibited for Custom clearing eCommerce low value goods. Not for VAT payments other EU member states.

Proposal: from 2021 also for e-Commerce goods (VAT experts are working together on this proposal). - No exemption for VAT anymore - No distance selling anymore. New rules.- VAT collection by non-EU vendor - VAT declaration and payment in one member state - This member state distributes VAT over the msEC, business, Customs.

EU: IORImporter of Record When a Customs Broker is the Importer of Record, they are essentially clearing the Import Shipment in their own name instead of that of the Consignee. The Broker is liable for all of the Customs regulations as they are legally the Importer, this could include additional duties, liquidated damages, or penalties.

Some Agency bodies, such as the Food & Drug Administration, or the Consumer Protection Safety Commission, still hold the Consignee liable, regardless of who might be the Importer of Record.

For Trademark violations, Customs regulations has provisions for Customs to enforce this for Imports. So if the Broker is IOR, Customs will hold the Broker accountable.

Becoming IOR for other Companies and/or third parties should be reviewed very carefully and cautiously, they need to be fully aware of the risks, responsbilities and actions that may be taken against them if found to be at fault as the IOR.

Note: even when the consignee is shown as the importer of record, some Agencies may pursue the Broker for the Consignee’s violations.

EU: EORIEconomic Operator Number

The Economic Operator Registration and Identification (EORI) number is a unique identifier, assigned by a Customs authority in an EU country to all economic operators (both companies and individuals) persons engaging in activities covered by EU Customs Legislation.

Importers established outside the EU will be assigned an EORI the first time they lodge:- a customs declaration- an entry summary declaration (ENS)- an exit summary declaration (EXS)

Operators use this number in all communications with any EU customs authorities where an EU-based identifier is required, for example in customs declarations.

Assignment of EORI NumberThe EORI number is assigned by the member state where the economic operator is established. An EORI number that has been issued in one of the member states is valid in all member states. EORI numbers will only be assigned to legal entities. Branches must use the EORI number of the head office.

UK: ImporterCompany Registration Process as an Importer As an importer to the UK, you need to register as a UK company with Companies House.

Once registered, you also need to obtain an EORI (Economic Operator Registration and Identification) number from HMRC (HM Revenue & Customs).

The forms you need to complete will vary according to the nature of your business, but they are all available on the www.gov.uk website.

You may also need to get a VAT registration too, if you ship in higher volumes.

UK: IOR & EORI

Importer of Record Responsibilities and Liabilities You are responsible for adhering to health and safety standards and fair trading policies across the EU. You can find all the details for this on the HMRC website via www.gov.uk.

EORI (Economic Operator Registration and Identification)

Requirements for the EU vary by country but paperwork will usually include a copy of the shipping documents, a copy of the commercial invoice, and packing list or manifest.

If you’re shipping B2C, you need to declare the final sales price, and if shipping B2B, the wholesale price of the shipped goods.

UK: D&TDuty Rates

Typical ecommerce shipments, low value items are zero rated – the threshold is currently £15 (in the EU it is €22), below which no tax is due.

If your stock is held in the UK you can still sell into other EU countries without having to VAT register in each until you reach the limit set by the EU Distance Selling Rules.

The UK E-Commerce Regulations require that all commercial web sites make the following information directly and permanently available to consumers via the website:•the company's name, postal address (and registered physical office address in the UK if this is different) and email address;•the company's registration number;•any Trade or Professional Association memberships;•the company's VAT number.www.Gov.uk

WCA eCommerce NetworkWorld’s first and largest, dedicated eCommerce Logistics Network

WCA is leading at the forefront of the Industry changes that are being driven by the online-digital transformation of eCommerce, Shipping, Logistics and Last Mile Deliveries.

WCA eCommerce Logistics Network connects market-leading Logistics Service Providers and eRetailers. We offer three levels of Membership: eMember, eVendor & eTailer.

This dedicated eCommerce Network is open to all Companies that wish to learn, grow and excel within this dynamic industry.

Contact your Regional WCA Managers or Contact Us to find out more.

ecommerce@wcaworld.com www.wcaecommerce.com