The list of dual-use items is updated regularly to ensure compliance with international obligations.

Background

The original EU dual-use regulation had entered into force on September 9, 2021.

Background

The Generalized System of Preferences (GSP) is an instrument of the European Union’s (EU) trade policy. It grants tariff preferences to developing countries when importing goods into the EU. However, GSP Regulation (EU) No. 978/2012 provides for the suspension of granted tariff preferences under certain circumstances. This is the case when the average value of these goods imported into the EU from the GSP beneficiary country exceeds the thresholds listed in Annex VI of the said Regulation for three consecutive years. The thresholds are calculated as a percentage of the total value of imports of the same products into the EU from all GSP beneficiary countries.

Source:
Commission Implementing Regulation (EU) 2022/1039 of 29 June 2022 laying down rules for the application of Regulation (EU) No 978/2012 of the European Parliament and of the Council with regard to the suspension for 2023 of certain tariff preferences granted to certain GSP beneficiary countries; OJ L 173, 30 June 2022, p. 58.

Customs regulations in Germany

As in other EU countries, importers in Germany must present a number of documents before allowing foreign goods into the country. These include the commercial invoice, the packing list, the certificate of origin, the waybill for sea freight or the air waybill for air freight.

In addition, it is necessary to register for an EORI number. Only companies with such a number are authorized to import or export goods within and outside the EU. If you are importing goods from the USA to Germany, you should also consider the following aspects:

• Note any restrictions in relation to certain goods
• Apply for an export license if required
• Take into account the applicable customs regulations: Imported goods from the USA and non-EU countries must be declared. The amount of customs duties is regulated in the Customs Ordinance § 29.
• Know all the important requirements regarding the payment of taxes. The contact for this is the General Customs Service. As long as the customs duties and sales tax due on the imported goods are not paid, Customs will retain the goods.
• Disclose the freight price. If this is not apparent, the value of the imported goods is estimated to determine the customs duties.
• Provide transparent information about the payment of freight costs. The key here is who pays the freight charges. If the shipper from the U.S. pays them, it is important that they are listed as line items on the invoice. Otherwise, the importer may be billed twice for the import duty.

Although there are not many restrictions on importing into Germany, some products are subject to additional regulations. These include pharmaceuticals, chemicals, steel and iron products, clothing and textiles, and vegetables and fruits. More detailed information on these and other products can be found in the TARIC database.

In mid-2021, the EU abolished the threshold at which e-commerce transactions in the EU are subject to EU VAT and a customs declaration. This means that all imports to EU countries – regardless of the value of the goods – are now subject to VAT.

An electronic import one-stop-shop portal has been introduced through which non-EU businesses can register for EU VAT and the correct amount of VAT will be paid to the Member State to which it is due. This simplifies the process by allowing you to collect, declare and account for VAT and pay your invoice directly to the EU tax authorities via a periodic tax return (for goods up to a value of €150).

For your customers, this means more price transparency: when they buy from a non-EU seller registered in the One Stop Shop, the VAT is part of the price they pay to the seller.

However, the best tip is: Find a reliable and competent customs service provider like Gerlach. We will take care of all customs-related matters for you and ensure that everything runs smoothly, while you can concentrate on your core business!

Export to Europe – why?

Over 748 million people call Europe home. The continent’s 47 countries have a wide range of socioeconomic demographics, but there is one commonality that should be of interest to ambitious online entrepreneurs: the rapid growth of e-commerce.

Driven by rising Internet penetration – and the pandemic, of course – 2021 was a milestone year for e-commerce in Europe, as the number of online shoppers passed the 500 million mark for the first time. And now the part that should really interest you: Cross-border e-commerce in Europe has grown to more than 25% of the region’s total online sales, as consumers increasingly look to foreign brands in search of new products and better prices.

In 2016, the Transatlantic Trade and Investment Partnership (TTIP), a proposed comprehensive trade agreement between the European Union (EU) and the United States to promote trade and economic growth, ended without an agreement. Nevertheless, the U.S. and the EU remain solid trading partners, accounting for one-third of global trade.

However, before you rush to draw a big circle around Europe on your map of sales targets, there are a few important things to keep in mind.

Choose the right markets for your business

The largest e-commerce markets in Europe are the United Kingdom, France, and especially Germany. Consumers in these markets are used to shopping online and feel comfortable buying from sellers abroad.

Perhaps you are already receiving inquiries from potential customers abroad. Look at your web analytics – is there traffic from new markets you haven’t tapped into yet?

Research your target country thoroughly. Is the demand for your products high enough to make shipping there a worthwhile investment? If there is already a lot of competition from domestic suppliers, how can you align your business to stand out from the competition?

Look at which European markets your U.S. competitors are selling to – because if they’re shipping to a particular country, there must be a healthy customer base there.

A good strategy for your European expansion is to focus on a few select markets first, like Germany. Then you can focus on the markets with the best visible results and expand there. But please note: Depending on your business model, you also need to consider tax aspects. For example, tax registration may be required in the respective country. It is best to seek comprehensive advice from competent experts with many years of customs experience.

Whatever your business, contact Gerlach Customs today! We help you reach new international markets with minimal effort and maximum profit.

Here we would like to briefly explain three essential aspects regarding the customs clearance of goods.

1) Third country: The USA is a third country for Germany. In terms of customs and foreign trade law, exports from Germany to the USA are therefore equivalent to any other export to a third country.

2) Tariff level: The tariff level is basically low. Exemption from customs duties is provided in the customs tariff for some products from the agricultural sector. In the commercial sector, many goods are also duty-free, for example in the areas of machinery and apparatus and electrical goods.

3) Responsible customs authority in the U.S.: Responsibilities for the regulation and monitoring of international trade in the U.S. are divided among several federal agencies. There may also be different ancillary costs depending on the state.

Conclusion:

Taking into account all the rules and regulations, it is therefore important to submit all the required documents correctly and in detail, as well as to comply with the requirements. To ensure a smooth and time-saving process, it is recommended to hire a good and experienced customs service provider like Gerlach.

Do you have any further questions? We at Gerlach will be happy to support you!

Now, Turkey has indicated that it will use only “Türkiye” as the country name to designate its official country name in international writing with immediate effect, and this name will also be applied with respect to the relevant parts of all preferential and non-preferential certificates of origin and movement certificates when the country name is to be indicated.

The name Türkiye should also be used exclusively when issuing proofs of origin issued in the EU and in the A.TR. movement certificate.

We therefore recommend to initiate the changeover process regarding the name change in one’s own company in order not to affect the movement of goods with Turkey.

According to information from the Turkish authorities, however, the country name “Turkey” used to date will be accepted in documents until further notice during an unspecified transitional phase. Any remaining stocks of forms can therefore still be used up.

The product concerned is aluminum motor vehicle wheels falling within CN headings 8701 to 8705, whether or not fitted with accessories, including tires, originating in Morocco.

The product is currently classifiable within CN codes ex 8708 70 10 and ex 8708 70 50 (TARIC codes: 8708 70 10 15, 8708 70 10 50, 8708 70 50 15 and 8708 70 50 50). A provisional anti-dumping duty of 16.5 percent applies (TARIC additional code C999).

In addition, there is a company-specific duty rate for HANDS 8 S.A.. This rate is 8 percent (TARIC additional code C873). In order to benefit from the company-specific duty rate, a valid commercial invoice must be presented to Member States’ customs authorities. This must contain a declaration dated and signed by a person in charge, identified by name and function, of the invoicing company, which reads as follows:

“I, the undersigned, certify that the [volume] [product concerned] sold for export to the European Union covered by this invoice was manufactured by [company name and address] ([TARIC additional code]) in Morocco and that the information provided in this invoice is complete and correct.”

If no such commercial invoice is presented, the 16.5 percent duty rate applicable to all other companies shall apply.

A security equivalent to the amount of the provisional duty shall be required for release for free circulation.

Incidentally, no anti-dumping duties are due retroactively for the period of the anti-dumping investigation in 2020/2021 because no customs registration was carried out by the customs authorities.

The Supply Chain Act at a glance

The Supply Chain Act obliges companies to observe human rights and certain environmental due diligence obligations in their supply chains in an appropriate manner. The obligations to be fulfilled are graded according to the actual scope of influence, depending on whether the company is dealing with its own business unit, a direct contractual partner or a more indirect supplier.

The law will apply from January 1, 2023 to companies with at least 3,000 employees. From January 1, 2024, companies with at least 1,000 employees will be affected.

The due diligence obligations of companies include:

• Establishment of a risk management system and performance of a risk analysis
• Adoption of a policy statement of the corporate human rights strategy
• Anchoring of prevention measures
• Immediately take corrective action when violations are identified.
• Establishment of a complaints procedure
• Documentation and reporting requirements for the fulfillment of due diligence obligations

Basic requirements for risk analysis

Risk analysis is the basis of appropriate and effective risk management. Only after assessing their risk profile are companies in a position to implement rules and procedures to effectively mitigate the identified risks. The LkSG requires companies to gather information about human rights and environmental risks not only within their own organization, but also in the supply chain. Based on the information gathered, companies must prioritize the risks identified and address the most significant risks first. The LkSG grants some discretion in the design and choice of methods for identifying, assessing and prioritizing risks – provided that the approach chosen is appropriate and systematic.

Regular risk analysis and ad hoc risk analysis

The LkSG distinguishes between two forms of risk analysis: a regular risk analysis and a risk analysis on an ad hoc basis. According to the law, the subject of the regular, annual risk analysis is all risks within the company’s own organization and at its direct suppliers. Risks at the level of indirect suppliers, on the other hand, are not to be included in the regular risk analysis.

In addition to the regular, annual risk analysis, the law requires companies to conduct an ad hoc risk analysis with respect to indirect suppliers if they have reasonable knowledge of a violation of a human or environmental obligation. Evidence of such a violation may arise from a variety of sources: Reports to grievance bodies, information in the media or reports from civil society, and discussions among industry representatives. It is worth noting that BAFA recommends going beyond the requirements of the LkSG in this regard. The authority considers it more effective to preventively monitor expected high risks than to have to take far-reaching measures when a human rights violation is imminent or has already occurred. The handout therefore suggests proactively involving the relevant parts of the supply chain in the annual regular risk analysis as soon as a company is aware of certain high risks.

In addition, all risks along the entire supply chain (i.e., own organization, direct and indirect suppliers) are subject to an ad hoc assessment if these risks have changed significantly or have arisen due to new circumstances. Such an ad hoc risk analysis may be triggered by a change in business activity, e.g. entry into a new sourcing country.

How is the risk analysis performed?

According to the BAFA manual, the assessment should be carried out in three steps:

1. First, a company needs to get a general picture of its business activities and the relationships in its supply chain.
2. After collecting the above information, the company must perform an abstract risk analysis.
3. Finally, the risk analysis must be completed by a specific analysis including the evaluation and prioritization of risks.

Companies should strive to gain an overview of their own procurement processes and make their supply chains transparent as a starting point for risk analysis. A suitable method can be risk mapping by business unit, location, product, raw material or country of origin.

To this end, companies should compile information on:

• its corporate structure, including the names, sectors and basic information of all Group companies,
• its procurement structure, including procurement categories, procurement countries, order volume and the number of direct suppliers per category,
• the nature and scope of its business activities.

In a second step, publicly available sources such as indices, rankings, UN or OECD guidelines and NGO reports are taken into account to identify subsidiaries, sites and suppliers with an elevated risk profile.

Based on the results of this abstract risk assessment, companies must identify the specific risks along their supply chains in a third step. They must then decide which risks they want to address first. Relevant criteria for this prioritization are:

• Nature and scope of business activities,
• Probability of occurrence,
• Severity of the violation,
• the ability to influence,
• the causal contribution of the company to the occurrence of a risk.

The risks identified in the specific risk assessment must be systematically documented, for example in a risk inventory.

The legislation recognizes that companies cannot conduct a fully comprehensive risk analysis from the outset. Therefore, the BAFA handout suggests a risk-based approach. Companies can initially rely on an abstract risk analysis and perform the specific risk analysis only for prioritized industries, locations and supplier relationships. If a company is already aware of high-risk subsidiaries or suppliers, it should initially focus its data collection on the corporate and sourcing structures of these entities. However, companies are required to gradually improve the transparency of their supply chains and thus extend the specific risk analysis process to all subsidiaries, sites and direct suppliers.

When developing preventive measures, companies can build on and refer to the results of regular and ad hoc risk analyses.

Background

The GSP scheme is a trade policy instrument of the European Union (EU). It grants tariff preferences to developing countries when importing goods into the EU.

The GSP system consists of a

– general arrangement

– special arrangement in favor of least developed countries [so-called Everything but Arms (EBA) initiative] and

– Special incentive arrangement for sustainable development and good governance [GSP+].

The list of GSP beneficiary countries is reviewed annually. GSP Regulation (EU) No. 978/2012 also contains provisions on the removal of tariff preferences for groups of products (so-called graduation) and safeguard measures in case of excessive imports into the EU. This is the case when the average value of these products imported into the EU from the GSP beneficiary country exceeds the thresholds listed in Annex VI of the said Regulation for three consecutive years. The thresholds are calculated as a percentage of the total value of imports of the same products into the Union from all GSP beneficiary countries.

Not least due to many new EU member states and the shifting of third country borders, it is necessary to transport goods quickly and flexibly to their final destination, even without many formalities of import customs clearance.

With the transit system, a procedure has been created which enables the final customs clearance to be carried out at a specific destination and not directly at the point of entry into the EU (port/airport/EU border).

The goods are transported from the customs office of departure to the customs office of destination under the so-called customs supervision, and within the procedure the goods always have the status of customs goods as non-Union goods T1, and in case of transport of Union goods to EFTA countries the status T2.

All EU member states, EFTA countries (Iceland, Norway, Liechtenstein and Switzerland), Turkey, the Republic of Northern Macedonia, Serbia and the United Kingdom are connected to the common transit procedure.

With an experienced and reliable customs service provider like Gerlach, customs clearance is as easy as can be. We will show you how in this article.

T1/T2 Customs clearance electronically via NCTS

The T-transit procedure is opened by customs at the point of departure. For the required electronic declaration in NCTS, data and information on the route, means of transport, identification, consignor and consignee, number of packages, total weight and the customs tariff number are required. The customs office of departure sets a presentation period within which the goods must arrive at the customs office of destination in order for the T procedure to be considered duly completed. Likewise, at the customs office of departure and also at the customs office of destination, an identity check of the goods is carried out; this is done by means of customs seals (seals/package seals) or identification features such as description noted in the transit declaration and physically attached to the means of transport/packages. In order to open a transit procedure, a security deposit must be lodged with customs in the country of opening to cover the duties likely to be incurred during customs clearance. The security can be cash, securities or a guarantee.

At the customs clearance at the place of receipt, the transit procedure is closed. After the goods have been presented and checked for identity, the conforming or possibly non-conforming completion of the transit document takes place, the security is released again and the goods are assigned to a new customs-approved destination. (Customs clearance, storage in bonded warehouse, new transit procedure, temporary storage, etc.).

Your advantages with Gerlach Customs Services and the “authorized consignor” permit

For most companies, both the creation in NCTS, the provision of security at customs and the presentation of the goods is a problem, which you can easily solve with Gerlach Zolldienste.

Gerlach Customs Services provides you with the necessary customs system NCTS as well as the best customs know-how to quickly and easily assist in the preparation of shipping documents.

A great advantage is also that Gerlach has the customs authorization “authorized consignor”, which allows to open the transit documents in many locations without the involvement of customs authorities. This makes the whole process much easier for you.

Gerlach offers:

• Issuing of transit declarations in the NCTS electronic procedure with and without authorization
• No communication with customs authorities in opening of transit declaration as “Authorized Consignor”.
• Using the Gerlach customs permit “Authorized Consignor” you can transport the goods without any action by the customs office, so in many places it is not necessary to present the goods at the customs office.
• This enables you to save costs and flexibility in the transport chain, also in case of multimodal transports, and you save waiting times at border or inland customs offices.
• Gerlach has sufficient guarantees and securities for the opening of transit procedures, which makes it possible to carry out the procedure even in the case of very high values of goods or sensitive goods.

Contact us today to speed up your customs clearance processes.

Whether in transit or any other customs service, Gerlach is always ready to assist you with advice and support. Feel free to contact us!