Customs agencies

As at 1 July 2017

Representation


Under the conditions referred to in Article 170 of the Union Customs Code (UCC), a customs declaration may be lodged by a person concerned or, according to Article 18 of UCC, any person may appoint a customs representative for performing customs operations and formalities provided for by the customs legislation. Such representation may be direct or indirect.

In the case of direct representation, the customs representative acts in the name of and on behalf of another person (the person represented) which means that the person represented, i.e. a consignee at import and a consignor at export, is always a declarant. Therefore, when completing a customs declaration, for example in the case of import, the data of a consignee or declarant (i.e. the person represented) are given in Box 8, and code “2“ and the details of a customs representative are indicated in Box 14.

In the case of indirect representation, customs representatives act in their name but on behalf of another person (the person represented) which means that unlike direct representation, the customs representative is always a declarant. When completing a customs declaration, for example in the case of import, the data of a consignee (i.e. the person represented) are given in Box 8, and code “3“ and the details of a customs representative, i.e. a declarant, are written in Box 14.

When selecting the type of representation, it is necessary to keep in mind that a declarant shall be responsible for the fulfilment of the obligations related to the placement of the goods under the customs procedure concerned and for the payment of customs duties if a customs debt is incurred on import (UCC Articles 15 and 77 (3)). Since in the event of indirect representation the customs representative is a declarant, the customs representative is responsible for the fulfilment of the obligations related to the placement of the goods under the customs procedure concerned, as well as the payment of customs duties. However, in the event of indirect representation, the person on whose behalf the customs declaration is made, i.e. the consignee, shall also be a debtor (UCC Article 77 (3)), and therefore the customs representative and the consignee are jointly and severally liable for the payment of the amount of customs debt (UCC Article 84).

Furthermore, regardless of the type of representation, a customs representative is always responsible for (UCC Article 15 (2)):

  • the accuracy and completeness of the information given in the declaration

  • the authenticity, accuracy and validity of any document supporting the declaration

According to the Customs Act (CA), a customs representative (both direct and indirect representation) has to hold an activity licence of a customs agency that operates through competent customs agents (CA § 17 (1) and § 19 (1)). As an exception, the activity licence is not required in the following cases (CA § 17 (2)):

  • when a customs declaration is lodged by a natural person acting as the customs representative of another natural person, unless representation is his or her economic activity;

  • a customs representative is not obliged to be established within the customs territory of the Union.

As a general rule, the customs representative holding the customs agency activity licence can operate only through customs agents who have passed the customs agent examination. Still, a natural person of the customs agency that holds the licence of an authorised economic operator for customs simplifications is considered to be competent without passing the customs agent examination. Since the customs data processing system checks the competence of customs agents indicated in Box 54G of the customs declaration, customs agencies inform the customs authority in advance of the customs agents working for them.
 

Empowerment of customs representative


As a general rule, a consignee/consignor (a board member indicated on B-card) empowers a customs representative to lodge customs declarations on his or her behalf electronically in the e-Tax/e-Customs. In the event of the authorisation to lodge customs declarations as well as to use a prepayment account or a guarantee for deferred payments, a legal representative of the consignee has to empower a customs representative in the e-Tax/e-Customs or at a service bureau of the Estonian Tax and Customs Board in writing.

Further information

If powers to act as a customs representative is not electronically registered in the e-Tax/e-Customs, the customs authorities may require the persons stating that they are acting as a customs representative to provide evidence of their empowerment (UCC Article 19). The evidence may be included either in a power of attorney or a contract concluded with the client. It is important that customs representatives should be able to prove their right to act on behalf of another person.

Customs representatives have to indicate in Box 14 of the customs declaration whether they are engaged in direct or indirect representation. If it turns out later that a customs representative has no powers to represent, the customs representative will bear sole responsibility for the tax liabilities incurred from the customs declaration.

There are three types of powers a consignee/consignor (person represented) can grant:

  1. authorisation to lodge customs declarations – a customs representative is empowered to lodge customs declarations on behalf of a consignee/consignor. The Estonian Tax and Customs Board presumes that in the case of indirect representation at importation, customs representatives are aware of their (joint and several) liability for financial responsibility.

    If a consignee does not grant the customs representative any supplementary powers for the use of the consignee’s financial resources (through a prepayment account, a guarantee), the method of payment entered in Box 48 in the event of direct representation can only be “2 – Paid by representative”, while on indirect representation it can be “2 – Paid by representative” or “0 – Guaranteed by representative”.
     

    In the case of direct representation, the payment method “0 – Guaranteed by representative“ cannot be entered in Box 48 of the customs declaration because in the event of non-payment of customs debt the customs has no grounds to recover the duties which have not been paid from a guarantor, since in the event of direct representation only a declarant, i.e. consignee, is responsible for the payment of the amount of customs debt (UCC Article 77 (3)).

  2. authorisation to use a prepayment account – empowers a customs representative to pay the amount of duty determined in the customs declaration from the prepayment account of the consignee, provided that the consignee wishes to pay import duties before the release of the goods (the payment method indicated in Box 48 of the customs declaration is “3 – Paid by consignee or consignor”).
     

    Such right can be exercised only if a customs representative holds a valid authorisation for lodging customs declarations.

  3. authorisation to use a guarantee for customs operations – empowers a customs representative to defer the payment of the amount of duty determined in the customs declaration using the consignee’s guarantee, provided that the consignee wishes to defer the payment of the amount of duty (the payment method indicated in Box 48 of the customs declaration is “1 – Guaranteed by consignee or consignor”).
     

    Such right can be exercised only if a customs representative holds a valid authorisation for lodging customs declarations.


Useful information
 

  1. In the case of direct representation, the customs accepts the payment method “2 – Paid by representative“, provided that the amount required for the payment of duties and taxes is available on the prepayment account at the time of the release of the goods. Using this payment method, the customs representative is not responsible for the payment of customs debt incurred upon subsequent entry in the accounts and, likewise, the representative does not have the right for the recovery of the amount of customs duties paid and released after subsequent entry. In the event of direct representation, the customs representative has no right to apply for the amendment or invalidation of a customs declaration after the release of the goods. Only the declarant, i.e. a consignee in this case, is entitled to make such an application.
     
  2. Should the need arise to amend the customs declaration after the release of the goods in the case of direct representation where the payment method is “2 – Paid by representative“, it is always necessary to change the payment method in the application as follows: “3 – Paid by consignee or consignor”. In such a case the amount of duties reduced by subsequent entry in the accounts will be made available on the prepayment account of the declarant/consignee, or the additionally imposed amount of duties will be paid from the prepayment account of the declarant/consignee who is entitled to apply for the amendment of customs declaration. If customs representatives themselves wish to receive the amount of duties paid by them, they have to contact their declarants/consignees directly.

  3. If the customs find inaccurate information in the customs declaration in the course of post-release control, a notice of assessment is issued imposing additional amounts payable and the declarant and, in case of indirect representation also a consignee are responsible for the payment of such additional amounts. In the event of direct representation, the customs representative is jointly and severally responsible for the payment of additionally imposed amounts only if the customs authority has established that the customs representative knew or ought to have known that the information in the customs declaration was inaccurate.
     
  4. Entries in the accounts are made in the name of the person who is indicated as a payer in Box 48 of the customs declaration. In the case of direct representation and the payment method “2 – Paid by representative“, the IT system automatically makes entries in the accounts in the name of the customs representative.


For further assistance

  • If you need general information on customs agencies, please call (+372) 880 0814.

  • Information about the service areas of customs agencies can be asked from the contact persons of customs agencies.

 

16.10.2018