Transit Step-by-Step Guide

Implementing Efficient and Compliant Transit Procedures with our Transit Step-by-Step Guide

In the realm of international trade, efficient and compliant transit procedures are essential for businesses seeking to streamline cross-border operations and minimize bureaucratic hurdles. Follow this step-by-step guide to implement transit procedures effectively and ensure compliance with regulatory requirements:

Step 1: Understand the Concept of Transit

Gain a comprehensive understanding of transit procedures and their significance in facilitating the movement of goods across borders while deferring duties and taxes.

Step 2: Determine Relevance to Your Business

Assess whether transit procedures align with your business needs and objectives. Consider factors such as the volume of cross-border trade, the frequency of shipments, and the potential cost savings associated with transit.

Step 3: Explore Common Transit Convention (CTC) and Union Transit

Evaluate the options available for transit procedures, including the Common Transit Convention (CTC) and Union Transit. Understand the legal framework and membership criteria associated with each option to determine the most suitable approach for your business.

Step 4: Familiarize Yourself with Transit Categories

Understand the two categories of common transit procedures: T1 and T2. Familiarize yourself with the distinctions between T1 (external transit) and T2 (internal transit) procedures, based on the customs status of the goods being moved.

• T1 (external transit procedure) – this covers the movement of non-EU goods, suspending the measures normally applicable to them on import. All UK goods are, for example, under T1 procedures. T1 suspends import duties, other charges and trade policy measures until the goods reach their destination.

• T2 (internal transit procedure) – this covers the movement of European Union goods, suspending the measures normally applicable to them on import to a common transit country. The internal Union transit procedure (T2) applies to Union goods moved from one point to another within the customs territory of the Union, which pass through a country or territory outside that territory without any change in their customs status. The T2 procedure also applies to goods moved from the Union to a common transit country, where it follows the export procedure. T2 is not used when the goods are carried entirely by sea or by air.

• The customs status of goods is essentially the factor that determines whether goods in transit move under a T1 or T2 transit declaration.

In certain circumstances, proof of the customs status of Union goods has to be produced.

Step 5: Understand the transit procedures

Familiarize yourself with the legal basis for transit procedures, including relevant conventions, regulations, and directives governing transit operations. Ensure compliance with regulatory requirements to avoid potential penalties or delays in transit movements.

5.1. Commence Goods Movement from Your Premises:

As an Authorised Consignor, you possess the authority to declare goods without their physical presentation at customs. You can print the Transit Accompanying Document (TAD) and extract goods under customs supervision directly from your approved location. Furthermore, you have the option to request the addition of new locations to your existing authorization.

5.2. Conclude Goods Movement at Your Premises:

As an Authorised Consignee, you're empowered to receive goods without the necessity of physically presenting them or the TAD to customs at the Customs Office. You can electronically transmit notification messages to the relevant office and automatically gain permission to unload the goods, provided they are not subject to further customs controls or inspections.

5.3. Transit Accompanying Document (TAD):

ssued by the Office of Departure or an Authorised Consignor at the initiation of the transit movement, the TAD features a barcode and a unique movement reference number corresponding to your transit declaration. It must accompany your goods throughout the transit journey until its conclusion, along with any required licenses.

5.4. Point of Exit:

Ports or carriers may demand evidence of the relevant declarations' completion and the goods' clearance for export. Similarly, evidence of declarations for entry into the subsequent customs territory may be required. Your TAD should serve as supporting documentation for this purpose.

5.5. Import Customs

- Accurate declarations are imperative upon arrival at destinations, with all requirements verified by the relevant customs authorities. These declarations must be inputted into the destination country's systems, necessitating an Economic Operators Registration and Identification (EORI) number.

5.6. Customs Duties and VAT

- Payment of customs duties and Value-Added Tax (VAT) is mandatory before goods can be released in the destination country. To benefit from preferential tariff rates, proof of origin for the goods must be furnished, as specified in the agreement's provisions.

Get a Guarantee

Exporters embarking on transit movements are required to furnish a guarantee to safeguard any customs duty, import VAT, and excise duty that are suspended during the transit journey. Enterprises engaging in transit operations more than three times annually should seek authorization to utilize a Customs Comprehensive Guarantee (CCG) and secure a guarantee from a financial institution or bank. Application for a transit guarantee can be initiated through your Government Gateway account, where customs will dispatch the necessary form for completion by your guarantor.

Step 6: Implement Transit Procedures

Initiate transit procedures by submitting transit declarations through the New Computerised Transit System (NCTS). Familiarize yourself with key messages and documents exchanged within the NCTS, including transit declarations, master reference numbers (MRNs), transit accompanying documents (TADs), and notification messages.

These are

6.1. Lodge a Customs Export Declaration:

- Before initiating a movement, submit a GB customs export declaration. Utilize the National Export System for combined declarations fulfilling fiscal and Safety and Security (S&S) requirements.

6.2. Fulfill Safety and Security (S&S) Requirements:

- Ensure compliance with S&S requirements upon entering and exiting borders or territories. Determine necessary exit and entry requirements for countries transited through.

- Create Transit and Safety and Security declarations (TSADs) via the New Computerised Transit System (NCTS) to combine transit and S&S requirements. Note that TSADs cannot be used to fulfill GB or NI S&S requirements. Complete relevant Exit Summary (EXS) declarations separately for GB exports.

6.3. Lodge a Transit Declaration:

- Submit a transit declaration through the New Computerised Transit System (NCTS). Obtain a Customs Comprehensive Guarantee (CCG) from a financial institution to secure any suspended customs duty, import VAT, and excise duty.

6.4. Take the Goods to an Office of Departure / Authorised Consignor:

- Transport goods to an Office of Departure or an Authorised Consignor's premises to produce a Transit Accompanying Document (TAD) and initiate the transit movement.

6.5. Complete the Office of Transit:

- Fulfill the Office of Transit process upon entering a different customs territory. Present the TAD either at a paper-based office or digitally, depending on the customs office's operations.

6.6. Take the Goods to an Office of Destination / Authorised Consignee:

- Deliver goods to an Office of Destination or an Authorised Consignee's premises to complete a TAD and conclude the transit movement. Ensure compliance with customs procedures for importing or discharging goods into another customs procedure.

6.7. Ensure Compliance to Release CCG:

- Adhere to the specified process to release the Customs Comprehensive Guarantee (CCG). Failure to follow the outlined steps may hinder the initiation of another transit movement.

Step 7: Ensure Smooth Transit Operations

Monitor transit movements and facilitate smooth operations by adhering to procedural requirements and timelines. Coordinate with customs authorities and relevant stakeholders to address any issues or discrepancies that may arise during transit.

Step 8: Utilize Simplified Transit Procedures

Explore opportunities to streamline transit procedures through simplified processes, such as authorized consignor and consignee arrangements. Leverage electronic systems and information-sharing mechanisms to enhance efficiency and reduce administrative burdens.

Step 9: Maintain Compliance and Accountability

Maintain accurate records of transit transactions and ensure compliance with customs regulations and procedures. Fulfill obligations related to guarantees and liabilities associated with transit movements to mitigate risks and maintain accountability.

Step 10: Seek Expert Assistance

Consider seeking expert assistance to navigate the complexities of transit procedures effectively. Consult with customs brokers, legal advisors, or industry experts to optimize transit operations and address any challenges encountered along the way.

Conclusion

Implementing efficient and compliant transit procedures is essential for businesses seeking to optimize cross-border trade and gain a competitive edge in the global marketplace. By following these steps and leveraging the benefits of transit procedures, businesses can streamline logistics operations, reduce costs, and capitalize on new opportunities for growth and expansion.

How We Can Help

Contact us to explore how our expertise and services can assist you in setting up and implementing transit procedures for your company. We offer tailored solutions to ensure efficient transit operations and compliance with regulatory requirements, empowering your business to thrive in the international trade landscape.