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Will the ‘mission-critical’ Smart Freight System for exports be ready on 1 January 2021?

The UK’s logistics industry has urged the government to accelerate the development of its technical solution for avoiding lorry queues in Kent from the start of next year.

The Smart Freight System (SFS) – unveiled as part of the UK’s Border Operating Model for post-transition trade – is being designed to ensure that no trucks arrive at the UK border unless they are carrying the correct export documentation.

Hauliers will be required to carry correct export declarations to successfully cross UK and EU borders from 1 January 2021, when the UK has left the EU’s single market and customs union.

Using SFS, drivers will be required to file in advance that they have completed the required paperwork before they travel to UK ports and could even face fines if they fail to do this.

Speaking to the BBC’s ‘Today’ programme on 17 September, Logistics UK’s head of public policy Alex Veitch said that the industry “fully supports and endorses” the policy as a concept.

The issue the industry has, according to Veitch, is that the delivery timetable is not moving quickly enough to give drivers time to prepare for using it.

Currently, less than a third of freight forwarders have any familiarity with the system, according to a survey published by the British International Freight Association (BIFA).

The system will be ready for beta testing next month, Veitch said, and will continue to be tested through December into the spring next year.

However, the industry will need time to learn how to use the system and may not be able to start doing so until the Christmas period under the current timetable.

[Institute of Export and International Trade]

European Court of Justice rules value of free of charge supplied software should be added to customs value

On 10 September 2020, the European Court of Justice (ECJ) published its decision in the BMW Bayerische Motorenwerke AG v Hauptzollamt München-case. The ECJ ruled that the value of free of charge supplied software should be added to the customs value of imported goods irrespective of the fact that the software was developed in the European Union (EU).

The ECJ explicitly states that the value of software should be added to the customs value as an assist provided the conditions of article 71(1)(b) UCC are fulfilled. Assists as referred to in article 71(1)(b)(iv) should only be added if undertaken elsewhere than in the EU whereas this exception does not apply to article 71(1)(b)(i) UCC. In other words, assists referred to in article 71(1)(b)(i) UCC should also be added if developed inside the EU. It is therefore, in cases where the buyer of imported goods provides in the EU developed software free of charge or at reduced cost, of the utmost importance that evidence is available showing whether the software is an integral part of the imported product or is necessary for the production of the imported good.

As in the instant case, the facts seems to indicate that the software is integrated, but also used and necessary in the production process, it can even be important to split the costs of the provided software to prevent that the full value of free of charge supplied software should be added to the transaction value of imported goods. Furthermore, companies should especially review their provision of software to non-EU manufacturers and also train their people to in detail identify and correctly assess situations involving the provision of software.

[Ernst & Young]

Dutch Customs publishes FAQ on the implementation of the new exporter definition

In light of the upcoming implementation of the new exporter definition per 1 October 2020, Dutch Customs published a FAQ on the website answering the most important questions. The FAQ explains – amongst others – the reasons for the implementation of the new definition and confirms that the new definition of exporter is not applicable for re-export. You can consult the FAQ via the following link.



Middle East

Over 500 cameras in constant watch at Kuwait’s air, sea and land ports

Kuwait ports (sea, land and air) are under the supervision of the General Customs Administration, round the clock, through the “Main Control and Surveillance Room” established at Kuwait Ports Corporation in Shuwaikh where the custom areas are monitored through 530 cameras, reports Al-Rai daily. The General Administration of Customs started managing and operating the chamber “virtually”, coinciding with the use of risk management system tools of the automated customs system, report added.

The daily visited the control room recently to look at the mechanism of work, accompanied by Director of the Department of Research and Investigation Rashid Al-Baraka who confirmed that 26 customs officials work in the room for monitoring the land, air and sea ports through 530 cameras distributed in all ports for controlling, connecting, monitoring and surveillance of work there. Al-Baraka pointed out that among the objectives of Control and Surveillance, which actually began operation last month, is pre-targeting the quality of import, export and transit operations at all customs ports, and the safety and security of their customs procedures.


Industrial investments to drive Saudi Arabia’s dry logistics market

Saudi Arabia dry logistics and warehousing market has shown a volatile growth trajectory during 2015 to 2019, according to a new report released by Ken Research.

However, the kingdom’s plans to pump investment into economic cities and other industrial projects will drive market revenue in the kingdom’s logistics and transportation sector, the research firm said in a latest market outlook of the dry logistics and warehousing sector.

“The KSA government is highly promoting the integration of multi-modal hubs across the country. FDI within the logistics infrastructure development, constructing regional & international logistics service centres and improving the efficiency of trade routes can collectively help the country in becoming a logistics hub over long term,” noted the report titled “Saudi Arabia Dry Logistics and Warehousing Market Outlook to 2025 – Warehousing Automation and Investment within Transport Infrastructure to Drive Market Revenue)”.

[Trade Arabia]