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Experience of the Eurasian Economic Union reflected in the most important WCO documents

Experience of the Eurasian Economic Union reflected in the most important WCO documents

The developments of the Eurasian Economic Union (EAEU) are included for the first time in the new edition of the Framework Standards for Security and Facilitation of International Trade, and some of the documents included in them are published by the World Customs Organization (WCO). Framework standards are the most important international document in the field of customs, a generally recognized reference point for the world customs administrations.

In particular, the updated edition of the Framework Standards reflects new simplifications that have become available to companies operating as an authorized economic operator (AEO) upon the entry into force of the Union’s new customs legislation.

Let us recall that with the launch of the EAEU Customs Code, a new AEO program was launched within the Union on January 01, 2018 providing additional opportunities for economic operators, including mutual recognition of AEO’s legal status within the EAEU, the possibility of such recognition in other countries and integration associations.

Owing to the EAEU Customs Code, the number of simplifications for AEO increased more than four-fold, also providing an opportunity for entrepreneurs, based on the requirements and benefits stipulated, to choose one out of three available types of AEO certificate. So, in particular, the business got an opportunity to save money by completing the transit and storing at its warehouse foreign products not yet released into circulation, to dispose of the goods before completing a declaration for them, to enjoy a delay in payment of customs duties, to annually reduce the amount of financial security for activities and a number of other privileges.

"Authorized economic operators occupy a central place in the Framework Standards being the most developed modern form of partnership between customs authorities and businesses. In the EAEU, we consider it as the backbone of the customs authorities, a business in regard to which a customs authority can minimize customs control, thereby saving resources and redirecting them to problem areas", - reported Dmitry Nekrasov, Director of the Department of Customs Legislation and Law Enforcement Practice of the Eurasian Economic Commission. – In our view, the AEO have great perspectives. Following this logic, in the new Customs Code we offered to the EAEU’s businesses operating under the AEO status numerous opportunities for resource optimization".

Another innovation in the EAEU relating to authorized economic operators is the AEO financial stability indicator, which formed the basis for the Customs AEO Validator Guide.

While working on the Framework Standards, the EEC shared with foreign colleagues its developments in the field of financial guarantees for the fulfillment of obligations for AEO, explained Dmitry Nekrasov. The new customs legislation of the EAEU reduces the financial burden on the business. Instead of presenting collaterals, it was proposed to provide evidence of its financial stability. "This is a completely new tool for us. In the old Customs Code, the concept of "financial stability" did not exist, - specified Dmitry Nekrasov. - "Our experts have developed the procedure for determining the financial stability of a legal entity that claims to be included in the registry of authorized economic operators along with values that characterize financial stability and are necessary for the inclusion in this registry".

Essentially, these formulas make it possible to objectively mathematically evaluate the financial stability of legal entities claiming to acquire the AEO status. This procedure made it possible to start applying a fundamentally new principle of covering financial risks and, for the first time, to avoid the need to provide collaterals in the form of a bank guarantee, a bid bond, etc., while including a person in the AEO registry. The innovation was highly appreciated by foreign colleagues. As a result, the mechanism is reflected in the international AEO assessment guide for the WCO Member States.
Framework standards of security and facilitation of international trade are the most important international document in the field of customs. Their main message is the need to ensure for participants of foreign economic activities a high degree of security and control over the goods in circulation in order to provide them maximum assistance from customs authorities and simplify customs operations.
Representatives of the EEC Customs Unit joined the work of WCO bodies on a permanent basis after the Memorandum of Understanding was signed between the EEC and the WCO in 2016. The current incorporation of EAEU’s standards and experience in the international WCO documents became the first official recognition of EAEU’s experience in the world customs community.