As part of the safety and security amendment to the EC Customs Code,[1] carriers will be required to provide pre-arrival information in a specified format for all cargo entering the EU regardless of the eventual destination of the cargo. This system is known as the Import Control System (ICS).

Why has this been introduced?

The ICS is one of three inter-related concepts introduced by the safety and security amendment to the European Customs Code:

• Common computerised risk-management
• Mandatory prior notification (ICS)
• Authorised Economic Operator (AEO)

These concepts have been introduced in an attempt to manage the increasing risks posed by international terrorism and a vulnerable international supply chain. The main difference between ICS and AEO is that whereas AEO is a certification programme whose aim is to differentiate between "safe" and "risky" traders, ICS is a transactional program that will enable customs authorities to evaluate shipments prior to their arrival in the EU.

When will this come into force in the UK?

ICS Testing will be implemented on 2 November 2010 in anticipation of the EU-wide "go-live" date of 1 January 2011.

Who is required to make the Declaration?

The legislation provides that the operator of the active means of transport on or in which the goods are brought into the EC (the "carrier") is responsible for ensuring that an entry declaration is filed. In the case of maritime or air traffic where a vessel sharing or contracting arrangement is in place, the obligation lies with the person who issues the bill of lading or air waybill for the actual carriage of the goods on the vessel or aircraft. Please note that although it is a carrier's responsibility and liability, actually filing of the Declaration can be conducted via a third party (such as a freight forwarder or importer/exporter). However, for this to take place the carrier must be informed in advance and must consent for this to take place. It is wholly a carrier's decision to allow clients or freight forwarders to submit declarations on their behalf.

What information will the carrier need to supply?

Carriers will need to submit an Entry Summary Declaration that to the Office of First Entry (OFE) in the EU.

The Declaration will include:

• Cargo identification details (Unique consignment reference (UCR), container numbers, seal numbers, goods description, shipping marks and customs commodity codes)
• Traders involved in the movement (consignor, consignee, carrier, person filing or lodging the declaration)
• Identification of consignee and AEO status
• Specific route into, across and out of the EU (depending on the transaction)

The declaration is required for ALL shipments, including those en route via the EU to a destination outside of the EU. Please note that there are provisions for third-parties

What are the time-limits?

There are different time limits for submitting the declaration depending on the mode of transport used. They are as follows:

What will the Customs Authorities do with the data?

EU Customs Authorities will conduct a risk-analysis of all incoming cargo before it reaches the EU. The authorities will then have to decide whether to approve the incoming movement or to intervene. If it is the latter then different types of "intervention" could include:

• Transmission of messages to Customs administrations in other Member States about any "risky shipments" that have been identified at the first port of entry to the EU
• Interception of goods on arrival in the EU
• The issuing of a "Do Not Load" message to the ocean loading carrier that will stop the loading of the goods and therefore shipment.

Any intervention is likely to cause delays and may result in examination of the cargo when it reaches port. Please be aware that any intervention could take place not only as a direct result of your shipment but due to another shipment travelling with the same container.

How will this affect the importer if it is the carrier that is supposed to make the declaration?

Supply-chain movements are spread across a number of actors: exporters, carriers, freight forwarders, importers and customs. The data required on an Entry Summary Declaration is likely be spread out amongst the aforementioned actors and a process will need to be put into place to gather this information and instruct (and monitor) the carrier in order for them to submit the declaration correctly and on time. It is likely that the agents will have to obtain the commodity code information from the importers. You will need a process for not only supplying them with the commodity codes at an earlier point in the supply chain (export from supply country rather than at time of import) but also a process for determining the correct codes and reconciling the codes used in the ICS message and import declaration.

What this is likely to mean is an additional cost element that importers will have to factor into their transactions as carriers will need to collect and transmit data which will require, systems, processes and potentially additional manpower. We recommend that importers review their arrangements with their carriers so as to ensure that the carrier is aware of any specific terms that may exist between exporter and importer and thus clarify who will be liable for any "processing charges" that the carrier may levy on this service.

What are the consequences of non-compliance?

This question actually throws up more questions than answers. What is clear is that carriers will face fines for failure to submit declarations on time (or if the data is incomplete) although the exact levels are yet to be determined and that businesses will face supply-chain delays if their goods are held up by Customs. What is not clear however, are the following:

• What are the consequences for filing inaccurate data?
• If inaccurate data is filed will this impact upon the importers customs status/authorisations (such as AEO)?
• If a carrier receives a "Do Not Load" instruction for a shipment that is already loaded on the vessel does that mean that the entire cargo is suspect?
• If only part of the cargo is deemed suspect, who will be held to account for any delays/financial penalties?

ITS Conclusions

It is anticipated that the introduction of the Import Control System will cause businesses and carriers alike a number of headaches, especially in the early "phasing-in" days. We recommend that businesses start thinking about putting procedures in place for the following:

• Who will be making the Electronic Declaration?
• Who will bear the addition costs of the ICS system?
• Who will be responsible for ensuring that the declarant has received all the required information?
• Who will be responsible for ensuring that data sent to the declarant is correct and complete?

International Trade Solutions is one of the industry leaders in customs planning and have worked on numerous projects with high-profile clients where we have designed specifically-tailored planning systems and monitoring procedures. Our industry expertise means that we know which questions are pertinent to your business and we pride ourselves on our ability to provide systems that are individual and specific to your needs and our client satisfaction rates are enviable. If you would like to discuss the Import Control System and how it may affect you or if you have any other customs-related query then contact us on (01905) 619229 or email us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

[1] As set out in European Parliament and European Council Regulation No. 648/2005 and Commission Regulation No. 1875/2006