The EU is the largest trading block in the world, followed by the United States and China, and accounts for over 15% of the world trade. Imports from third countries into the EU reached over EUR 2 trillion in 2019, rising from about EUR 1 trillion in 2004 and EUR 1.5 trillion in 2008. In recent years, a large proportion of these imports comes from e-commerce. In 2019, more than 2 000 EU customs offices, working 24 hours a day and 365 days a year to manage this volume of international trade, handled the import, export or transit of over 868 million items. The departure of the United Kingdom from the EU Customs Union has further increased the workload of EU customs authorities, leading to a significant rise in customs declarations to be processed.
Still, during the COVID-19 pandemic, customs acted swiftly and played a critical role in speeding up the delivery of urgent and vital goods and controlling dangerous goods at any point of the EU external border. They prioritised the delivery of personal protective equipment, medical devices and medicines and the supply of urgent food supplies and livestock when shortage in several EU countries were reported. EU customs also jointed efforts to control export of COVID vaccines.
Despite its successes, our Customs Union is facing multiple growing challenges that call for its modernisation to accelerate the twin green and digital transition. The explosion of e-commerce presents customs with an inflow of small consignments with new financial, counterfeit, compliance, safety and security risks. The EU Green Deal means additional stringent environmental legislations and harmonised and strengthened standards. The mission of customs is expanding and brings Member States control capacities to its limits. On the other hand, there is an increasing demand for greater facilitation and acceleration of legitimate trade to be accommodated without neglecting the protection against financial and non-financial risks of EU citizens as well as against the unfair level playing field between EU companies and their international competitors.
In order to stimulate “thinking outside the box” in the EU debate on the future of the Customs Union, the Commission called on external expertise and established a “Wise Persons Group on Challenges Facing the Customs Union” (WPG). The primary role of the Group was to reflect on the development of innovative ideas and concepts and deliver a report that contributes to a general inter-institutional debate on the future of the Customs Union.
WPG Tasks
The Wise Persons Group was invited to reflect on the following key topics:
- E-commerce
- Risk management
- Effective management of customs’ increasing range of non-financial tasks
- Future governance structure
The Wise Persons Group was also invited to identify other challenges that the Customs Union could face in the future.
Final Report
On 31 March 2022, the Wise Persons Group published their landmark report on how to bring the EU Customs to the next level.
Their conclusion is that EU Customs need an urgent structural change which, building on the reforms of the last decade, take European customs to the next level and prepare them to address modern challenges, such as new trade models and growing trade volumes, technological developments, the green transition, the new geopolitical context and security risks.
The Group recognises important changes to customs legislation and IT in recent years and commends the reform plans set out in the Customs Action Plan adopted by the College in September 2020. However, it advocates for more fundamental and wide-ranging reforms, expressed in 10 recommendations to be implemented by 2030. These include revised and simpler customs legislation, a new framework of responsibility and trust, streamlined procedures and reduced administrative burden, a new approach to data, a more effective governance. Particular emphasis was put on the need for a paradigm shift, to ensure that EU Customs contributes to Europe’s security and defence and act as a Union-wide system, rather than the sum of Member States’ individual efforts. Customs are essential in managing crises at the European borders and protecting citizens, businesses and revenues.
The Wise Persons Group recommendations focus on five main areas which, taken together, would provide for a modern and resilient Custom Union:
- A strong Customs Union with a protective “one external border” is essential to the solidity of the EU’s trade might and single market and thus to Europe’s strategic autonomy and to Europe’s security.
- EU Customs that play their role in promoting the EU way of life, by making sure that sustainability, safety, human rights, health, and security concerns are upheld in all customs transactions with better cooperation between customs, market surveillance authorities and law enforcement bodies.
- EU Customs that strengthens their capacity to ensure proper collection of customs duties and taxes at the border to contribute to much needed public spending capacities. An annual estimate of the Customs Revenue Gap should be introduced.
- Greening of customs so that they play their role in the green transition, starting by making its own operations more sustainable, EU Customs should also make green customs a priority at global level in the World Customs organisation.
- EU Customs must have a new approach to responsibility and trust with simpler procedures for economic operators in exchange for the assumption of greater responsibilities on their side, including for e-commerce platforms; it should be centred on a new vision for data gathering, sharing and use for EU-risk management; and with a reformed authorised economic operator scheme to better facilitate trade with trust.
You can read the full report:
Working Methods and Reporting of the WPG
The Group will keep the Member States and the Commission regularly informed about the progress of its work. The information provided to Member States and the Commission should focus in particular on e-commerce and risk management given the urgent need for solutions in these two areas.
The Group may conduct hearings with public and private sector experts.
The Group will be informed about, and should take into account, the work already being carried out by existing project groups and subgroups, and studies such as the outcome of a foresight exercise on “The Future of Customs in the EU 2040” launched by the Commission in 2018.
The Group will finalise a report by Spring 2022 that will be presented to Commissioner Gentiloni in charge of the Customs Union, to the Council, to the European Parliament, to the Customs Policy Group and to the Reflection Group once established.
Membership
The group was composed of 12 members. Members were appointed in a personal capacity, thus acting independently and in the public interest. The Director Generals of Customs were invited to propose names of independent persons for the Wise Persons Group to the TAXUD Director General. The participants in the Wise Persons Group were selected with a view to ensuring where possible an adequate geographic, gender and professional balance. The Members of the Group have experience in either the public or the private sector, and in customs matters, e-commerce, risk management, the international supply chain, IT systems and data analytics internal market legislation and international trade law. Members were appointed for a period of nine months.
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Members of Customs Wise Persons Group |
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Chair: Mrs. Arancha González Laya, former Minister of Foreign Affairs, European Union and Cooperation of Spain. |
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Vice chair: Mrs Mateja Vraničar Erman, Adviser to the Slovenian Minister of Foreign Affairs and former Minister of Finance of Slovenia. |
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Member: Mr Emmanuel Barbe, Préfet at French Ministry of the Interior and former Deputy Secretary General for European Affairs at the French Prime Minister´s office. |
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Member: Mrs Manon van Beek, CEO of TenneT. |
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Member: Mr Kevin Cardiff, non-executive Director at KBC Bank Ireland, former Member of the European Court of Auditors and former Secretary General of the Finance Department of Ireland. |
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Member: Mr Martti Hetemäki, Professor at the Helsinki Graduate School of Economics and former Secretary of State at Ministry of Finance of Finland. |
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Member: Mrs Vendulka Holá, former Deputy Director General of the Czech Customs. |
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Member: Mrs Katarina Kaszasová, Managing Director of the Auditing Oversight Authority of Slovakia and former Director General at the Slovak Ministry of Finance. |
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Member: Mrs Gerda Koszinowski, Head of Directorate at the German Central Customs Authority. |
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Member: Mr Kris Peeters, Vice-President of the European Investment Bank (EIB) and former Deputy Prime Minister of Belgium. |
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Member: Mr Sérgio Vasques, Professor at Universidade de Lisboa and former Secretary of State for Tax Affairs in Portugal. |
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Member: Mr Vincenzo Alfonso Visco, President of Nuova Economia Nuova Società (NENS) and former Minister of Finance of Italy. |
Meetings
Meetings of the Wise Persons Group
1st meeting of the Wise Persons Group 17 September 2021
2nd meeting of the Wise Persons Group 7-8 October 2021
3rd meeting of the Wise Persons Group 10-11 November 2021
4th meeting of the Wise Persons Group 16-17 December 2021
5th meeting of the Wise Persons Group 20-21 January 2022
6th meeting of the Wise Persons Group 17-18 February 2022
7th meeting of the Wise Persons Group 10-11 March 2022
More information about the members of the Group
The members of the Group, as well as invited experts, are subject to the obligation of professional secrecy, which by virtue of the Treaties and the rules implementing them applies to all members of the institutions and their staff, as well as to the Commission's rules on security regarding the protection of Union classified information, laid down in Commission Decisions (EU, Euratom) 2015/443*] and 2015/444**.
*Commission Decision (EU, Euratom) 2015/443 of 13 March 2015 on Security in the Commission (OJ L 72, 17.3.2015, p. 41).
**Commission Decision (EU, Euratom) 2015/444 of 13 March 2015 on the security rules for protecting EU classified information (OJ L 72, 17.3.2015, p. 53).