Amendments to the EU Excise Directive has been saved
Amendments to the EU Excise Directive
On 27 February 2020, the Council of the European Union (“EU”) officially published the recast version of Council Directive 2008/118/EC concerning the general arrangements for excise duty (“Recast Excise Directive”). Formally adopted as Council Directive (EU) 2020/262, it introduces changes to the current excise rules and will formally replace Council Directive 2008/118/EC as of 13 February 2023.
The main changes introduced by the Recast Excise Directive can be categorised in three areas:
- Streamlining the interaction between excise and customs procedures;
- External transit procedure for Union excise goods destined for export;
- Computerisation of duty paid B2B movements of excise goods.
Streamlining the interaction between excise and customs procedures
The Recast Excise Directive seeks to streamline the interaction between excise and customs procedures. It includes new obligations for declarants when excise goods are imported into and exported from the EU.
In case excise goods are imported into the EU and subsequently transported under excise duty suspension, the declarant will have to include the relevant (excise) authorisation number of the consignor and consignee in the customs declaration which allows them to carry out this transport. In addition, the declarant may be required to submit evidence that the imported excise goods are intended to be dispatched from the EU Member State of importation to another EU Member State. Based on the text of the Recast Excise Directive, compliance with this latter obligation will depend on the national legislation of the EU Member State of importation.
In case of export, the declarant will be obliged to include in the export declaration the Administrative Reference Code (“ARC”) listed on the electronic administrative document (“e-AD”) accompanying the (export) movement of excise goods under excise duty suspension. While it is currently already possible to include the ARC in the export declaration of excise goods, the Recast Excise Directive ensures that it will be the standard procedure across the EU.
Lastly, where a standard confirmation of exit of excise goods from the EU is not available, the Recast Excise Directive establishes a common list of documents that may be used as alternative proof that the excise goods have physically left the EU. This improvement results in a more secure process and easier release of the excise guarantee when there is no official confirmation of exit from the customs authorities that the excise goods have left the EU.
External transit procedure for Union excise goods destined for export
The Recast Excise Directive builds on the earlier changes in the EU customs legislation that provided the possibility for Union excise goods that are being exported to be placed under the external transit procedure (“ET”). This could trigger a confirmation of exit for the goods prior to them physically leaving the EU.
Following the adopted amendments, Union excise goods placed under the ET procedure, will move within the EU under the cover of two guarantees. The first stage of the movement, while the goods are placed under the export procedure, will be covered by an excise duty guarantee. Once the goods are placed under the ET procedure, their movement until their physical exit from the EU will be covered by a customs guarantee, which will also cover a potential excise duty debt.
Computerisation of duty paid B2B movements of excise goods
Currently, the movement of excise goods released for consumption in one EU Member State and transported to another EU Member State for commercial purposes (duty paid B2B movement) is based on the use of a hard copy Simplified Administrative Accompanying Document (“SAAD”). Under the Recast Excise Directive, duty paid B2B movement of excise goods will no longer be supported by the SAAD, and will instead go through the electronic Excise Movement and Control System (“EMCS”).
One of the practical consequences of this change is the creation of new roles for the economic operators that wish to make use of duty paid B2B movement of excise goods. In order to be able to dispatch such goods in EMCS, an economic operator will need to be registered as a “certified consignor”. To receive such goods, an economic operator will need to be registered as a “certified consignee”.
When will the amendments start applying?
Article 55 of the Recast Excise Directive requires EU Member States to implement the amendments into their national laws, and apply them as of 13 February 2023. Until that date, national laws based on the text of Council Directive 2008/118/EC will continue to apply.
Impact on business
The Recast Excise Directive may impact your business in any of the following ways:
- you and your business partners will need to comply with new obligations when excise goods are imported into or exported from the EU;
- you need to take into account additional guarantee requirements when using the external transit procedure for Union excise goods destined for export;
- you may need to register as a certified consignor and/or consignee in order to use duty paid B2B movement of excise goods.
Businesses should keep in mind that EU Member States are generally allowed some leeway when implementing EU directives. There may thus be differences between the national laws of individual EU Member States implementing the Recast Excise Directive.
Deloitte professionals have proven expertise in excise matters. We can help you in assessing the impact of the Recast Excise Directive on your supply chain and determining the best course of action for your business. For more information, please contact: