Thousands of UK shippers still unprepared for customs system switch

Source: The Loadstar
Date: 23rd June 2022

Up to 220,000 UK traders have yet to register for the government’s new customs declaration system as the 30 September deadline looms.

From October, UK imports will run through the Customs Declaration Service (CDS), as HMRC terminates support for the Customs Handling Imports and Exports Freight platform (CHIEF), but government efforts to migrate traders to the new system appear to be stalling.

One source told The Loadstar: “Importers haven’t realized the importance of the switchover – if they don’t register they cannot use deferment.

The government approach up to now has been very soft – by sending a few emails – but people get so many emails they’re not likely to pay any attention. If it really intends to have everyone over on time, it needs to be reaching out.

This week, HMRC announced it had contacted more than 220,000 businesses and “urged” them to move over to CDS, if they had not already done so.

The department also appeared keen to push some of the legwork onto the industry, noting that larger businesses “must start working” with software developers, service providers, and agents to “begin the migration now”.

Director general for borders and trade at HMRC said: “There are just over three months until CHIEF closes for import declarations and all businesses will need to use CDS.

It takes businesses time to move across onto the CDS, depending on the size and nature of their business, so they must start the process now to ensure they are fully set up ahead of the 30 September deadline.

It is incredibly important that businesses move across to the system as soon as possible. There is plenty of support and guidance available to help.

However, the level and quality of support offered have been repeatedly criticized, with the government’s “very hands-off” approach under particular scrutiny amid the so-called “knowledge gap” faced by new users of CDS, despite it having been running since 2018.

Nonetheless, it appears unlikely that the 30 September switch-off of CHIEF for UK imports will be postponed, with multiple sources certain the date is “set in stone”.

CDS undoubtedly still have some teething troubles, however, the resolution appears to lay with software providers, They need to ensure their responses are in sync with the CDS system expectation and HMRC in a particular manner. Traders generally imagine that, because they have been encouraged to have intermediaries, their commitment is minimal.

However, for continental Europe, it seems the switchover has come at an unfortunate moment, with many new automation programs covering import, export, and entry not due to take effect until next year. A spokesperson for the European Shippers Council told The Loadstar this had made it “very difficult” to raise company awareness.

This has the ultimate consequence that importers will not be able to make declarations and, in the EU, we face the situation that many importers think they can simply leave this either to their software provider or their provider.

But this ignores reality, as it is importers who hold responsibility, so shippers’ organizations are working with customs organizations, trying to make traders aware.

The ESC spokesperson said part of the problem had been the approach taken by customs, noting that sometimes texts published by customs are too friendly and don’t give enough sense of urgency.

This could end up with the impossibility to make declarations – which means a stop to trade.

Despite the number of businesses that have yet to register, it is “eminently possible” to get the job done in the 14 weeks left before the deadline, but said this would require traders using intermediaries.

More positively, it was optimistic about the switchover, judging CDS as a “good system” that will “bring some stability” to proceedings.

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