Updated 10 January 2011
Members are advised that the webpage of the European Commission has been updated to contain special information about the Regime, including guidelines with many Q & A and scenarios.
Updated 7 December 2010
The INTERTANKO Documentary Committee has developed some charter party guidance along with two model charter party clauses, which address the impending EU Advance Cargo Declaration Regime for inclusion in fixtures. The guidance and the charter party clauses are available to download.
Updated 3 December 2010
BIMCO’s Documentary Committee meeting in London approved two new standard clauses, which address the impending EU Advance Cargo Declaration Regime that is due to come into force on 1 January 2011.
The clauses, one for voyage charter parties and one for time charter parties, are modelled on the previously published BIMCO US AMS clauses. Under the voyage charter party version it is the shipowner who assumes the role of ship operator and thus responsibility for compliance with the Regime. Under the time charter party version the responsibility rests with the charterer.
The clauses are available to download from the BIMCO website free of charge.
Published 19 November 2010
The EU Advance Cargo Declaration Regime (“the Regime”) comes into effect on 1 January 2011. The purpose of the Regime is to ensure the security of EU Member States through the better monitoring of the movement of goods. Any failure to comply with the obligations laid down in the Regime results in individual EU Member States imposing penalties in accordance with their national legislation. It is therefore recommended that members familiarize themselves with the requirements so that they can avoid becoming subject to enforcement actions.
Background
The Regime is closely modelled on the AMS (Automated Manifest System) requirements in the US, although (unlike in the US) there is no need for a bond. It applies to all cargo being imported to or exported from the EU. The Regime applies in addition to existing customs rules laid down in the Community Customs Code. It applies to all shipping sectors (unlike in the US), but there are different provisions according to each of these sectors.
Cargo information to be submitted
The person who declares cargo information in advance to the customs office must obtain an EORI (Economic Operator Registration and Identification) number and submit an electronic ENS (Entry Summary Declaration) for imports to or EXS (Exit Summary Notification) for exports from the EU. The cargo information must be supplied at least four hours before arrival/departure (two hours for short sea shipping and combined transport - 24 hours for deepsea container shipping). In addition, an ARN (Arrival Notification) needs to be submitted to the customs office immediately upon arrival of the vessel at the first EU port of entry. A diversion request will have to be submitted in case of diversion of a ship. If an advance cargo declaration has been done, a confirmation receipt (MRN – Movement Reference Number) will be sent by the customs office to the person who made the declaration.
Risk-assessment by the customs office
Once the customs office has received the cargo information, it will analyse it and identify potential safety and security risks. It may identify three types of risks: (i) Risk type A – DNL (“Do not load”); (ii) Risk type B – where the cargo posing a serious safety and security risk will be handled in the first EU port of entry or the port of departure; and (iii) Risk type C – where the safety and security risk is not serious, the cargo will be handled in the EU port of discharge.
The person liable to declare cargo information
Legal responsibility to declare the cargo information in advance lies with the ship operator, also in cases where the security filing is done by a third party. He must ensure that the declaration has been done, either by declaring the information himself or ensuring that his representative, such as a ship agent, does it on his behalf. A freight forwarder (or NVOCC) can submit an ENS if the ship operator has been advised thereof beforehand and consents (a so-called “third party filing”), but even under these circumstances the ship operator will ultimately remain responsible for the information provided. Operators may though seek indemnities from the forwarder and Members need to ensure that appropriate contractual arrangements are made under these circumstances. There are two exceptions to the ship operator’s responsibility to declare the cargo information, i.e. where there is (i) combined transport (the truck company or driver resumes responsibility); or (ii) a vessel sharing (or slot) agreement (the bill of lading issuing carrier resumes responsibility).
Electronic advance cargo declaration
In order to comply with the requirements laid down in the Regime, a ship operator, which is importing goods to or exporting goods from the EU, or its representative, is obliged to establish a computer system to allow him to interface with the computer system of that customs office, to which they have to submit the required cargo information in advance. Unfortunately, each EU Member State has different specifications and file formats as to how to communicate with them in an electronic manner, but most of the Member States have an appointed IT manager acting as contact person for the shipping companies (the list of IT managers for import and for export). Since the specifications and file formats are not yet harmonized or compatible, the burden lies on the ship operators to develop an in-house solution or purchase a suitable software solution in order to fulfil their requirements laid down in the Regime and it is recommended that Members review their IT solutions to ensure that they interface with the computer system of that customs office, to which they have to submit the required cargo information in advance. The EU envisages that Member States shall accept, at the latest by June 2015, simplified and harmonized reporting formalities that make use of an electronic form to be transmitted via a “single window”.
Comment
We recommend that Members bear the requirements laid down in the Regime in mind when drafting charterparties, vessel sharing (or slot) agreements and bill of lading contracts to ensure that they are followed properly. There is no clear guidance as to whether the owners or charterers are the ship operators for the purpose of advance cargo declarations and BIMCO will shortly be launching two clauses, a time charterparty version where the charterers accept the responsibility as ship operators and a voyage charterparty version where owners take on this role. In practice, the most important point is to make sure that owners and charterers understand which of them is to take on this responsibility for complying with the necessary formalities.
Members are advised that fines for non-compliance with the requirements laid down in the Regime fall outside the scope of their P&I cover.
Further details can be found at the website of the European Community Shipowners' Associations (ECSA) and on the European Commission Customs Portal. The full text of the EU Advance Cargo Declaration Regime can be found in Regulation 648/2005, which was implemented by Regulation 1875/2006 and amended by Regulation 312/2009.