Proving Origin When Exporter Ceases Production

26 November 2012

The European Court of Justice (C438/11) was asked to consider the post clearance recovery of customs duties for goods imported under preference when it was impossible to verify the accuracy of the certificate of origin because the exporter had ceased production.

The ECJ ruled that the burden of proof rested with the importer in these circumstances. If the competent authorities are unable, through subsequent verification, to determine whether the certificate of origin that they issued was based on a correct account of the facts then the importer was liable for the duty.

Businesses benefiting from preference should (a) determine the level of savings they are enjoying and, if material, should (b) take steps to take advantage of the “good faith” provisions that prevent retrospective duty demands where investigations query whether the origin rules are met.

ITS works with clients to determine the benefits they enjoy under preference arrangements and advises on ensuring all claims are made and any risks of subsequent challenge are minimised. Contact us for more information.

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