Policy & Compliance
BIFAlink
www.bifa.org
signing party must identify the capacity in which it signs. If it does not hold an authority to act as claimed, HMRC may decide that it is “self- representing” and thus fully liable for any debt. Direct Representatives are not normally liable for payments to HMRC, or fines, unless the goods are excise goods and there has been an irregular importation under the above-mentioned regulations. This is because the duty point is in the UK as goods are bonded and it is the party in the UK handling that importation who is seen as the party with primary liability, though it is shared with the importer. It is that party’s duty to ensure no release of the excise goods within the UK until duty has been paid and liability for wrongful release is joint and several with the importer. Clarification examples It is hoped that the following examples will clarify the situation: • The import agent (declarant) brings an import consignment of 80 cases of wine into the UK, entering the goods for consumption in the UK. At the point of clearance into the UK the
goods are released from bond and the Customs agent and importer become jointly and severally responsible for the debt if it has not been paid, as the release is wrongful. • The same shipment arrives, and the import agent is instructed to enter the imported wine to Customs warehousing. The declarant’s liabilities are discharged once they are accepted at the Customs warehouse, if that is the point of delivery. The warehouse keeper is now responsible to ensure that the 80 cases of wine are not released until all Customs procedures have been completed. Wording in the authorisation agreement to act as Direct Representative can ensure financial protection for the forwarder against all debts, subject to overriding legislation such as The Holding and Movement Duty Point Regulations 2010. Similarly, it is important for Members to have incorporated the current BIFA STC as Clause 20 (A), The Indemnity Clause, would protect Members, so long as they have been following their clients’ instructions.
However, it is important to note that Clause 20 (A) does not afford protection where the Member’s negligence or error or omission is involved in the wrongful entry of excise goods into the UK. For example, if a driver refuses or fails to stop to present Customs documents then liability for unpaid taxes and penalties may become the Member’s responsibility. Know your customer In the final analysis, much rests upon ensuring that Members ‘know their customer’ and the appropriate suppliers and contractors, risk assess each shipment for each potential liability, and give clear instructions, preferably in writing, to parties acting on the Member’s behalf. Every shipment involves some risk; it is important to assess whether the business being done warrants that risk. In particular, for excise shipments, it is important for Members to control as much of the movement as possible, conduct stringent due diligence on their customers, and work with trusted and reliable suppliers in order to minimise risks.
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