Authorised Economic Operator (AEO)

Hot news

Mutual recognition agreement with Japan

On 24 June 2010 the EU Commission signed the mutual recognition agreement with Japan. The two main benefits that will be of interest to businesses are:

taking the AEO status of an operator authorised by the other customs authority into account favourably in its risk assessment to reduce inspections or controls and in other security-related measures
endeavouring to establish a joint business continuity mechanism to respond to disruptions in trade flows due to increases in security alert levels, border closures and/or natural disasters, hazardous emergencies or other major incidents, where priority cargos shipped by AEOs could be facilitated and expedited to the extent possible by the Customs Authorities

Financial solvency criteria

Recent experience has shown that some AEO applicants, to enable them to meet the AEO financial solvency criteria, have referred to a 'letter of comfort' type document.

Unfortunately, examples seen so far are not acceptable to HM Revenue & Customs (HMRC). Legal services have drawn up an example of a form of legal undertaking which is acceptable for the purpose of a parent company covering certain debts of a UK legal entity. This document would need to be presented during the audit process.

AEO Proven Solvency - example of legal undertaking

Timescales update

From 1 January 2010 HMRC will have 120 calendar days from receipt of a full and complete application to issue a decision. There are options to extend this deadline by either the applicant or HMRC.

Applications

AEO application packs consisting of forms C117, C117 (Notes), C118 and C118 (Notes) are now available on the HMRC website. If you wish to email your application you will need to use the Word documents. If your system is not compatible then the PDF versions will need to be downloaded.

Businesses wishing to apply for AEO are also able to access a secure online web application form.

HMRC and Business Link have developed this product to help make the process of applying for AEO easier. It provides an interactive form that offers links to the guidance notes for completing the relevant questions.

To use this service, businesses will need to register with Business Link, which is free of charge.

Notice 117 Authorised Economic Operator is available on the HMRC website.

Postal applications can be sent to:

HMRC AEO Central Site
Fitz Roy House
Castle Meadow Road
Nottingham
NG2 1AB

HMRC strongly suggest that applicants sending documents by post use a recorded/registered service for data security purposes.

Email: AEOapplications

Tel: 0845 001 0089

AEO draft Guidance v6 is now available on request via email.

Who’s authorised?

The European Commission has launched an AEO database which allows anyone to check who holds a certificate, which type, date of issue and country.

Background

The amendment to the Community Customs Code (the Security Amendment), adopted by the European Parliament in April 2005, allows Customs authorities to grant the status of AEO to any business that satisfies EU criteria. Member States successfully voted on the detailed legal provisions to implement the concept on 23 October 2006 and AEO status will become effective from 1 January 2008.

EC Regulation 648/2005 and its Implementing Provisions are available on the Commission’s Europa website.

Once a Member State has granted a trader (economic operator) AEO status, this status will be recognised across all Member States.

AEOs will be able to benefit from facilitations for customs controls or simplifications for customs rules or both, depending on the type of AEO certificate. There are three certificate types:

Customs Simplifications. AEOs will be entitled to benefit from simplifications provided for under the customs rules.
Security and Safety. AEOs will be entitled to benefit from facilitations of customs controls relating to security and safety at the entry of the goods into the customs territory of the Community, or when the goods leave the customs territory of the Community.
Customs Simplifications/Security and Safety. AEOs will be entitled to benefit from both simplifications provided for under the customs rules and from facilitations of customs controls relating to security and safety (a combination of one and two).

Conditions and criteria for granting a certificate

Criteria includes an appropriate record of customs compliance, satisfactory management systems that allow appropriate customs controls and proven solvency. Additionally for Security and Safety, it includes details of the security and safety standards to be met. The applicant will need to hold an EORI number to apply for AEO.

Training

HMRC have now introduced a BTEC qualification which is also available to businesses wishing to gain a more in depth understanding of the AEO Safety & Security criteria.

More details can be obtained by contacting: Senate Training .

Other courses and providers may also be available.

APEO scheme

The Commission has adopted two new regulations (1005/08 and 1010/09) in the fight against illegal, unreported and unregulated fishing. If your business is involved in the importation/exportation of fish, fish products/processing from/to a third country a new scheme will be launched in 2010. To be eligible for the scheme a business must first hold an AEO authorisation - they may then apply for the APEO (Approved Economic Operators) scheme. More details are available on the Defra website.

Businesses involved in the import/export of fish should note that the application form C115 for Approved Economic Operator (APEO) is now available. Further details regarding eligibility are on the Defra website.