1.  The UKWA is a major trade association representing a large trader community within the public warehousing sector in the U.K.

  2.  Within the association is an active group involved in providing customers with the facility to store goods under duty suspension.

  3.  As chairman of that group I represent the interests of the UKWA on the Joint Customs Consultative Committee, the Joint Alcohol and Tobacco Consultation Group and their subgroups. I attend the Excise Alliance and represented the association on the Alcohol and Tobacco Fraud Review. I am a member of the association and I am employed as Managing Director of a "bonded warehousing company".

  4.  The association has a process of vetting potential members who apply for membership to ensure that we represent only the most professional and trustworthy members of the warehousing community.

  5.  UKWA is a member association of The European Warehousing and Logistics Confederation (CEEL).

  6.  Compliance is only possible if concise and relevant information is available to traders generally and is given in a timely and comprehensible manner.

  7.  The process of Customs control has shifted to an audit base and traders while being given more scope to run their own companies have more potential to genuine error if such information and guidance is not readily available.

  8.  Many changes have been made in the name of trade facilitation which may in truth have more to do with departmental facilitation in order that internal targets on manpower and cost reductions can be met.

  9.  The decentralisation of responsibility out to the outfield i.e. out to collection level can and does result in differing interpretation of the regulations at a local level. There are therefore inconsistencies throughout the UK and the lack of a "level playing field". This situation is to some degree covered by firstly the right to a departmental review of most decisions followed by appeal to the VAT and Duties Tribunal.

  10.  Greater emphasis needs to be placed on providing training, education and assistance to traders who wish to be compliant and to this end Customs & Excise have created the Importer/Exporter Support Programme Consultative Group to consider the problem and provide this service. This hopefully will address trade concerns about the levels of service from inland advice centres. It will be a step towards joined up government if partnership can be established between various policy owners that are involved in international trade for example Customs & Excise, DTI, MAFF etc.

  11.  Better standards of training for non-VAT C&E staff is required if high quality advice is to be provided to traders by Customs & Excise staff. Differing levels of training within the department gives us great cause for concern.

  12.  UKWA is working with the department within this forum.

  13.  Customs & Excise are undertaking market research to look at their levels of achievement against their Charter standards and it is hoped that this will be fed back into the Support Programme discussions.

  14.  Consultation between Customs & Excise and trade is good and there are numerous areas of common interest where useful work has been done. Other areas fail to reach the levels of consultative success that they deserve.

  15.  I would like to cite as an example the consultation relating to CFSP where in our own case we were led to believe that the warehousing industry would not be involved. In the end it has become an integral part of the system but we only became involved in the consultation process at a very late stage. This problem was exacerbated by the very high turnover of Customs & Excise staff involved in the development of CFSP and the unrepresentative nature of the trade side representation within the sub-group.

  16.  At the other end of the spectrum much useful work has been done between trade and Trade Policy Group (TPG) of Customs & Excise in the area of preference imports and the problems of back duty demands where it was found that origin rules had not been satisfied. While little has been achieved in Brussels in response to Council Decision 96/C 170/01 of 28 May 1996 (the 152 study) in which there was a call to alleviate a situation that "is unfair to Community traders" it does demonstrate that the department can work closely with trade associations.

  17.  The effect of non-compliance on compliant traders is most vividly illustrated in the case of alcohol and tobacco fraud.

  18.  UKWA was a founder member of the Joint Alcohol and Tobacco Consultative Committee (JATCG) and the Excise Alliance.

  19.  The Excise Alliance is a forum where Customs & Excise can inform trade associations of developments within the Excise area and hear trade views. It is however within the JATCG, a smaller group, that much extremely useful joint work has been done.

  20.  There has been a good, longstanding working relationship between this association and Excise Policy Group and much of what was announced as ATFR findings had been under discussion prior to that review.

  21.  As an association we are not happy with a number of recommendations within the ATFR which place considerable burdens on compliant traders while having little or no apparent effect on the non-compliant.

  22.  The Warehousekeepers and Owners of Warehoused Goods regulation 1999 was rushed through without careful consideration even though trade associations warned that it was flawed. It appears that wine will have to be excluded due to technical difficulties and there are delays in the issue of certificates.

  23.  The association is concerned about the additional burdens that are placed on compliant traders and have voiced concern about the levels of sub-delegation provided within the SI. This allows Customs & Excise to effectively change the "law" without any requirement for trade consultaton or scrutiny by government. One compensation for Customs & Excise being allowed themselves (as opposed to the Treasury) to adopt regulations such as WOWR subject only to negative resolution procedure in parliament should be that they should consult on the drafting to a much greater extent and much earlier in the process; otherwise there is no effective check on unworkable or extreme legislation being made.

  24.  The regulation does little to deter non-compliance unlike earlier proposals regarding registration of those moving goods under duty suspension.

  25.  I would again say that we generally enjoy a good working relationship with Excise but feel that they are now rushing through some of the ATFR proposals for purely political ends rather than in a way that will impact upon the problems they are supposed to address.

  26.  On the matter of bootlegging, smuggling and diversion of excise goods most of the problems arose with the completion of the single market. With no border or import controls and as a result of the decision that Customs & Excise should not be involved with the movement in any way the door was open for fradulent movements.

  27.  There is a perceived swing towards inward diversion of goods simply because Customs & Excise do not see any paperwork or involve themselves in the discharge of the movement. Other MS do stamp control copies of documents but it must be admitted that this has not in itself stopped diversion (use of false stamps) however, if there is no customs involvement the fraud is that much easier.

  28.  As part of CEEL the association has been involved in the consultation process with Alcatel regarding the proposed computerisation of the AAD system. Customs & Excise must give their full backing to this initiative, agree to be involved in the process and be provided with adequate funding to allow the project to succeed. With the open borders within the community intelligence is the key to smuggling and computerisation will give customs the information they require far more quickly.

  29.  There must be potential of closer working between government departments and this is being pursued under the Importer/Exporter Support Programme initiative. In the past we have seen a distinct lack of liaison between departments where there are common interests for instance between Customs & Excise and the DTI.

  30.  Joined up government must be an aim in order to provide a high quality service and reduce burdens on traders.

  31.  This association promotes high standards within our industry. We wish to work closely with C&E to achieve compliance without undue burdens on honest traders. We wish to be regarded as partners in the drive to root out non-compliance and illegal traders who are having a damaging effect on our members and those of other trade associations.

October 1999