Many of the key benefits of the new Customs Code will only be available to AEO businesses or on demonstrating AEO type conditions. Although AEO has been around since 2008, only 1034 authorisations have been granted in the UK (compared to 12,000 in Germany). The small uptake of AEO in the UK is largely down to the difficulty in justifying the business case for implementation. The new Customs Code is likely to provide a clear tipping point for a large number of businesses to adopt AEO and we expect a huge surge in the number of applications.
AEO implementation typically takes 120 plus man days. HMRC has limited resources to process these applications and these are likely to become further stretched as they have to reauthorize over 9000 existing customs approvals because of the new Customs Code.
Businesses are going to have to invest in this soon to have any chance of obtaining AEO by 1 May 2016.
We recommend businesses carry out a cost/benefit review for implementing AEO as a matter of urgency and if this results in a clear advantage in implementing AEO then start the application now.