RESULTS OF THE SECOND FOCUS GROUP “MONITORING CHANGES IN THE CUSTOMS SPHERE IN THE CONTEXT OF RUSSIAN AGGRESSION AGAINST UKRAINE”
On May 18, 2023, the Association of Customs Brokers of Ukraine held the second focus group discussion this year on the current conditions for export-import operations, transit cargo clearance, and interaction with representatives of the State Customs Service.
Discussing the trends in foreign trade over the past few months, the participants – customs brokers and customs experts – noted that there have been no significant changes. This applies to both export and import of goods and logistical challenges in their implementation.
Due to Russia’s military aggression in Ukraine, the vast majority of goods are cleared at the Ukraine/EU border at international automobile checkpoints (IACPs). The load on the western border of Ukraine is considerable, and the capacity of international automobile checkpoints remains one of the most pressing problems.
Before Russia’s military aggression in Ukraine, the volume of cargo clearance at automobile checkpoints was three times lower. Starting in May 2023, the throughput capacity deteriorated due to protests from Poland. First, agricultural producers (soybeans, wheat) protested, and now carriers are protesting, as European carriers still have quotas for permits from Ukraine, unlike Ukrainian carriers, for whom European countries have canceled the permit system since February 24 last year.
The situation at the automobile checkpoints has improved somewhat due to the electronic queue, but this does not solve the problem of congestion. For a week now, the electronic queue has been operating in test mode at Rava-Ruska, Krakovets, Porubne, and Uzhhorod checkpoints. Previously, it was only available at Yahodyn. There are parking areas for cars near the border, but they are very small, designed for a maximum of 200 cars. The most problematic checkpoint with the longest queue is Yahodyn, where the estimated time for processing one car is 1 hour. Given the length of the queue, which is currently 35 kilometers, no electronic mechanism can solve a problem of this magnitude.
Currently, the issue of passing through a separate corridor for vehicles heading to other countries and not subject to veterinary and phytosanitary control is being resolved. For them, all non-tariff regulations will be applied at their destination.
Proposals for improving the situation at automobile checkpoints (border with the EU):
– expand the capacity of the checkpoints through infrastructure development;
– to provide the possibility of joint customs and border control, following the example of the checkpoints on the Ukraine-Moldova border (Palanca checkpoint). Here, the total time for processing one car usually does not exceed 30 minutes.
The main problem that, in the opinion of the FGD participants, needs to be addressed immediately is the determination of customs value. Today, this procedure remains as non-transparent as possible and contains a corruption component. Businesses are making efforts to confirm the customs value of their customs clearances, keeping in touch with the State Customs Service and having positive results – one of the group members noted a situation where the customs value was adjusted in favor of the importer.
The group members noted that customs clearance of goods in the import mode is often done “according to the tables”. In other words, customs officials use the available tabular data and make decisions on the customs value of a particular imported product, which, in the opinion of business representatives, primarily serves to fill the budget.
Customs brokers are not satisfied with the functioning of the Automated Risk Analysis and Management System (ARMS). A practical example of its inefficiency: representatives of an international logistics company were working on the clearance of goods under the EU-Ukraine state agreement, the Yelampochka Agreement. They imported 180 cars with light bulbs, and almost 170 of them were cleared for customs. However, customs duties are not paid on such shipments in accordance with the Cabinet of Ministers’ resolution. Letters were sent to the customs, but the risk system continued to work.
Regarding interaction with customs authorities, participants noted that the quality of communication depends on the region of the customs office. There are customs offices where issues are resolved quickly and at a high level, and there are situations where, on the contrary, interaction is rather slow and inefficient (issues that arise: unclear referrals for customs inspection, initiation of customs inspection at the end of the time limit for clearing a vehicle, delays in customs clearance of goods). Businesses also note the high level of quality of communication with representatives of the SCSU central office.
Business representatives see the solution to the problem in the possibility of communicating with the inspector online for each customs clearance, which would allow them to promptly provide additional documents to confirm the customs value, if necessary, as well as provide clarifications at the request of the inspector.
The ACBU plans to hold such focus group discussions on a regular basis in order to monitor changes in the customs sector related to the introduction of martial law in Ukraine.
If you would like to join the discussion, please send us a request by e-mail: info@ambu.org.ua or call: +380953046894
We will be glad to see you among the participants of our next events.
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This publication has been prepared within the framework of the project Support to the Public Initiative “For Fair and Transparent Customs” with the assistance of the European Union), implemented by the Institute for Economic Research and Policy Consulting. The contents of this publication are the sole responsibility of the Ukrainian Association of Customs Brokers and can in no way be taken to reflect the views of the European Union