A path towards streamlined customs controls and trade facilitation through enhanced digital cooperation between authorities at EU borders
Each year, the Custom Union facilitates the trade of more than €3.5 trillion worth of goods. Efficient customs clearance and controls are essential to allow trade to flow smoothly while also protecting EU citizens, businesses and the environment.
On 28 October 2020, the European Commission proposed a new initiative that will make it easier for different authorities involved in goods clearance at the border to exchange electronic information submitted by traders. The “EU Single Window Environment for Customs” is designed to provide quicker and more efficient sharing of electronic data between national customs administrations and EU regulatory authorities across policy domains. Once fully rolled out, the Single Window will streamline and simplify processes for traders, allowing them to submit customs and regulatory information required for import, transit or export of goods only once through a single point of entry, thus strongly increasing the gains for trade facilitation. Customs and other authorities will then be able to automatically verify that the goods in question comply with EU requirements and that the necessary formalities have been completed. This is an ambitious project that will entail investment at both EU and Member State level, with gradual implementation over the next decade or so.
Why has the Commission proposed the Single Window?
Currently, the formalities required at the EU’s external borders often involve many different authorities in charge of different policy areas, such as health and safety, the environment, agriculture, fisheries, cultural heritage and market surveillance and product compliance. As a result, businesses have to submit information to several different authorities, each with their own portal and procedures. This is cumbersome and time-consuming for traders and reduces the capacity of authorities to act in a joined-up way in combatting risks.
This proposal is the first step in creating a digital framework for enhanced cooperation between all border authorities, through one Single Window. The Single Window will enable businesses and traders to provide data in one single portal in an individual Member State, thereby reducing duplication, time and costs. Customs and other authorities will then be able to collectively use this data, allowing for a fully coordinated approach to goods clearance and a clearer overview at EU level of the goods that are entering or leaving the EU.
What are the components of the EU Single Window?
The proposal establishes three components of the EU Single Window:
- National single window environments for customs, providing a set of services and systems owned, managed, developed and operated by the Member States. Rather than introducing entirely new IT platforms, this component will be implemented based on interfaces with existing import, export or transit systems at national level. Member States will set up harmonised national single windows, through which traders can upload the information related to the goods they are bringing in or out of the EU. Where possible, the Commission is ready to support the Member States in this work, including through funding from the Recovery and Resilience Facility.
- Union non-customs systems, representing IT systems or databases developed by various Commission departments across policy areas to digitalise documentary requirements and authorisation/licensing schemes regulated at EU level.
- EU Customs Single Window Certificates Exchange (EU CSW-CERTEX), forming the central component of the EU Single Window, developed by the Commission to link the national single window environments for customs to Union systems or databases managing non-customs requirements so that all relevant authorities can access the relevant data and collaborate more easily on border checks.
How was the project conceived?
The 2008 e-Customs Decision was the first piece of EU legislation that called on the Commission and the Member States to endeavour to establish a framework of single window services. To achieve these objectives, the Venice Declaration was endorsed by the Council Conclusions of 17 December 2014, proposing a progressive action plan to implement and regulate these services at EU level.
The EU Customs Single Window-Common Veterinary Entry Document (EU CSW-CVED) pilot and its successor, the EU CSW-CERTEX project have contributed to the operationalisation of this vision. These projects enable the automated verification by customs of several non-customs regulatory formalities submitted with the customs declaration as evidence of compliance. The formalities interconnected with EU CSW-CVED included the common entry document (CED) and the common veterinary entry documents for imports of animals and products of animal origin (CVED-A and CVED-P), stored in DG SANTE’s original version of TRACES system, known as TRACES Classic. EU CSW-CERTEX is connected to the successor of TRACES Classic, TRACES New Technology, to support the automated verification of the new common health entry documents (CHED-A, CHED-P, CHED-PP, CHED-D) that entered into force on 14 December 2019. EU CSW-CERTEX also covers exchanges for a multitude of other non-customs formalities hosted in EU databases and regulated by different legal acts under the responsibility of various Commission Directorates, including the certificate of inspection for imports of organic products (COI), the forest law enforcement, governance and trade licenses for imports of timber (FLEGT), licences to import or export ozone-depleting substances (ODS) and certificates for the import of fluorinated greenhouse gases (F-GAS). Work is currently advancing on expanding the coverage, traffic capacity and functionalities of EU CSW-CERTEX through regular releases to interconnect additional formalities such as export licences for dual-use goods, import licences (ICG-L), importer statements (ICG-S) and general description (ICG-D) for cultural goods, formalities related to non-food product safety and compliance, permits under the Convention on International Trade in Endangered Species (CITES) and export licensing requirements for F-GAS certificates. EU CSW-CERTEX will continue to operate as a pilot project to interconnect these formalities until the latter are regulated by the legal proposal.
How was the proposal prepared and who was consulted?
The proposal was preceded by the preparation of an impact assessment, carried out under the leadership of DG TAXUD. An interservice steering group, chaired by the Secretariat General, supported the steering of the initiative.
A project group was launched in December 2016 to collect data for the purposes of the impact assessment. Its activities continued until June 2019, combining the expertise of customs and IT delegates from 19 Member States administrations and representatives of six trade associations.
A public consultation ran from 9 October 2018 to 17 January 2019. In total, 371 valid responses were received, most of which were from businesses. A detailed analysis of the results of the public consultation can be found here. Additional targeted consultation activities were carried out to collect stakeholders’ views. Annex 2 to the Commission’s Staff Working Document on the impact assessment report provides an overall synopsis of the outcome of the different consultation activities and how this input has been taken into account.
What does this legislation propose?
The proposal will create the appropriate conditions for enhanced digital collaboration between customs and partner competent authorities to properly implement the external aspects of many internal market policies and reduce the administrative burden on trade.
The development of the EU Single Window Environment for Customs rests on two pillars of digital administrative cooperation among customs, partner competent authorities and traders.
Government-to-Government (G2G) digital cooperation
The first pillar, government-to-government (G2G) digital cooperation, will enhance exchanges between government authorities to support the automated verification by customs of the non-customs formalities required for goods clearance, allowing partner competent authorities to properly monitor and control the quantities of authorised goods imported or exported at EU level. The G2G mechanism and data flows are illustrated in the figure below.
Business-to-Government (B2G) digital cooperation
The second pillar, business-to-government (B2G) digital cooperation, will serve as a further enabler to streamline clearance processes for traders when dealing with certain EU non-customs regulatory requirements by allowing them to provide data in one single portal in an individual Member State. The implementation of this mechanism requires an enabling G2G framework for a given non-customs formality and the modification of EU sectorial legislation to allow for changes in the way traders interact with the respective partner competent authorities, provided that a number of specific eligibility criteria are met. This means that traders can decide whether to file the necessary information with the Union non-customs systems or national single windows depending on their suitability. The relevant data requirements for the non-customs formalities selected for inclusion in the B2G scheme will be identified through tertiary legislation governed by the proposal. The figure below depicts an overview of the B2G processes for goods clearance.
To support these pillars of digital cooperation, the proposal calls for additional facilitation measures to extend the use of the Economic Operator Registration and Identification System (EORI) to partner competent authorities and appoint national coordinators in each Member State to coordinate all activities associated with the effective functioning of the Single Window.
What are the expected benefits?
The intergovernmental component of the Single Window will save significant time in the customs clearance through the automated verification of non-customs formalities and less reliance on customs manual documentary checks, thus saving human resource efforts and ultimately expanding the control capacities of customs administrations. The direct automated exchange between authorities will particularly benefit traders who will not need to present supporting documents physically for the customs clearance. Given the 24/7 availability of the automated supporting documents verification service, the clearance of standard cases may happen even outside the working hours. Likewise, the B2G aspect of the proposal will streamline and simplify the fulfilment of regulatory formalities for traders, thus allowing them to skip the need for using non-customs systems, and reducing duplication, time and costs. The simplification of regulatory formalities, the decrease of clearance time and the resources needed to deal with them, may ultimately benefit citizens, as lower costs may be transferred to them in the form of lower prices.
Apart from rendering the customs clearance more efficient, the proposal will bring significant improvements on the compliance and enforcement of non-customs regulatory requirements. The automated quantity management at EU level will enable the automated verification of ‘write-offs’ throughout the Union, providing a control tool to avoid fraudulent use of supporting documents over the authorised quantities. A better compliance and enforcement of the non-customs regulatory formalities under scope will have positive impacts on protecting public health and safety, enhancing security, preserving cultural heritage and protecting animal welfare and the environment.
In early 2021, the European Parliament (EP) and the Council, represented by members of the Committee on the Internal Market and Consumer Protection (IMCO) and the Working Party on Customs Union, commenced the first reading of the proposal in line with the ordinary legislative procedure. DG TAXUD supported this process by facilitating technical meetings with the co-legislators to clarify key concerns and address any other issues raised in preparation for the EP’s amendments and the Council’s compromise text. The suggested formulations on the revised legal text were regularly discussed with the Council’s Working Party chaired by the Portuguese and Slovenian Presidencies. DG TAXUD also engaged in a series of bilateral exchanges with many Member States that sought further guidance or expressed reservations on certain aspects of the proposal.
In October and December 2021, the EP and the Council issued mandates for their respective negotiating positions in anticipation of the start of interinstitutional negotiations on the Regulation. Between February and mid-May 2022, 11 technical trilogues were held with the negotiating teams of the EP and the Council under the French Presidency. Discussions during these trilogue negotiations were mainly focused on the need to find mutually acceptable solutions on the key amendments tabled by the co-legislators.
In parallel with the legislative activities, a Single Window B2G project group was launched in mid-April 2021 and continues to meet regularly. This project group brings together the contributions of experts from customs and regulatory bodies representing 14 Member States with the objective of mapping out the current B2G processes, determining the requirements affecting customs and non-customs formalities and building the foundation for future B2G implementation.
The political trilogue took place on 19/05/2022 between high representatives from DG TAXUD, the EP and the Presidency of the Council and achieved a successful outcome to the negotiations. The co-legislators endorsed the parts of the text preliminarily agreed at the technical level and reached political agreement on several additional themes that emerged from their proposed amendments to the Commission’s original proposal.
System connection and operational management
- The scope of the proposal is broadened to include additional non-customs formalities for which the use of a Union non-customs system is voluntary, proposed by the EP as Part B of the Annex.
- The monitoring of all other regulatory requirements and formalities proposed by the EP as Part C of the Annex will be replaced by yearly progress reports prepared by the Commission as a way of embedding cross-sectorial horizon scanning into ongoing and future developments pertaining to the digitalisation of Union non-customs formalities. Every third year, these yearly reports will also cover monitoring and evaluation activities on the Regulation.
Implementation timelines for the single window services
- The connection dates for the implementation of the government-to-government scheme are postponed to 2025 for both the mandatory and voluntary Union non-customs systems. The Commission accepted this amendment in the spirit of compromise but during the legislative negotiations consistently advocated sticking to the initially proposed date of 2023 for two reasons. Delegated Regulation (EU) 2019/1602 imposes the obligation on customs to perform quantity management at EU level for the Common Health Entry Document (CHED) as of 1 March 2023. The interconnection with EU CSW-CERTEX is the only way to automate this process to reach a resolution by the deadline set by sectorial legislation. At the same time, several non-customs formalities covered by the intergovernmental scheme have emerged as a political imperative in achieving the climate protection goals under the Green Deal and need to be addressed as a matter of high priority.
- The timeframe for the implementation of the business-to-government scheme is agreed to nine years after the entry into force of the Regulation.
Committee procedures for implementing acts
- All implementing acts will be adopted under the examination procedure given that their implementation carries significant budgetary implications for the Member States.
- The role of the national coordinator is slightly enhanced to “promote and support” the cooperation between customs and national competent authorities at the national level, echoing a policy choice that is consistent with the Commission’s original proposal.
What are the next steps?
Formal adoption and publication of the Regulation establishing the EU Single Window Environment for Customs are expected in Q4 2022. Soon thereafter, DG TAXUD will start working on preparing the implementing and delegated acts governed by this Regulation. The proposed draft text of these acts will be discussed with the Member States at a new section of the Customs Code Committee, named “Single Window Environment” (CCC-SWE).
The intergovernmental component of the Single Window is anticipated to come into effect by 2025, whereas the business-to-government scheme will be accessible at a later stage.
Background information and related links
Press release: political agreement More detailed information about the milestones and deadlines of the EU Single Window environment for customs initiative can be found in fiche 1.13 of Annex II of the MASP-C