Nová legislativa EU v rámci boje s odlesňováním - část sedmá: hranice

New EU legislation to combat deforestation - part seven: borders

There is a saying that repetition is the mother of wisdom. Let us therefore recall an important point at the outset: the EUDR does not distinguish between "EU" and "non-EU" commodities and products - its obligations (which we covered in part three) apply regardless of whether the commodities or products cross EU borders.

Nevertheless, crossing EU borders has its own specifics, which is why we are devoting today's episode of our series to it.

Given that the relevant products are defined in the Regulation by means of Combined Nomenclature codes, it is necessary to know these codes regardless of whether the commodities or products in question actually cross the border. However, if this is the case, the person lodging the customs declaration for the release for free circulation or export of the products is obliged to make the reference number of the relevant due diligence statement available to the customs authorities.

This obligation is also pointed out by the Customs Administration of the Czech Republic HERE; the importer/exporter or their customs representative is to enter the reference number in box 44 of the customs declaration. Each consignment must be accompanied by a unique due diligence statement, but each customs declaration may contain reference numbers relating to more than one due diligence statement. If the above sounds complicated, don't despair - we'll cover filing of due diligence statements and reference numbers in the next episode.

In the context of crossing the border, note the subtle mention of specific customs regimes, i.e., free circulation and export. According to the information published by the European Commission, the obligations under the EUDR only apply in the case of these two customs procedures. Other procedures, such as customs warehousing or inward processing, are not covered by the Regulation. Thus, in some cases, the choice of customs procedure can significantly affect not only the extent to which, but also whether at all the Regulation will apply.

On the other hand, the less favourable information is that re-import is a “standard” placing on the market in the eyes of the Regulation and therefore, irrespective of whether the obligations have already been fulfilled in relation to the product in question (when it is exported) and the due diligence statement has been filed, all steps must be taken again.

The time of acquisition of title is also important. The question of whether a particular entity (e.g. a company) acquires ownership of products while they are still outside the EU or after they have entered the internal market can be quite central to the assessment of what type of entity is involved. The type of entity partly determines the requirements that the Regulation imposes on a given situation.

Thus, although border crossing is not the main focus of the EUDR, it should not be underestimated. The right customs procedure and contractual set-up for the transfer of product rights can make the whole process either much easier, or much more complicated.

For more detailed information, please contact the authors of this article or other members of the EY team with whom you work.

Authors:

Jan Turek

Jakub Kašuba