AUTHORISED ECONOMIC OPERATORS

1 EUROPEAN COMMISSION DIRECTORATE-GENERAL TAXATION AND CUSTOMS UNION security , safety, Trade Facilitation, Rules of origin & International cooperation Risk Management and security Brussels, 11 March 2016 TAXUD/B2/047/2011 AUTHORISED ECONOMIC OPERATORS GUIDELINES Approved by the CCC-GEN (AEO subsection) on 11 March 2016 2 It must be stressed that this document does not constitute a legally binding act and is of an explanatory nature. Legal provisions of customs legislation take precedence over the contents of this document and should always be consulted. The authentic texts of the EU legal instruments are those published in the Official Journal of the European Union. There may also exist national instructions or explanatory notes in addition to this document." 3 Table of Contents ABBREVIATIONS.

2 6 PART 1, GENERAL INFORMATION .. 8 Section I - Introduction .. 9 AEO-Customs Simplifications (AEOC): .. 10 AEO- security and Safety (AEOS):.. 11 AEO-Customs Simplifications/ security and Safety (AEOC/AEOS): .. 11 Preparation before submitting an application: .. 12 Section II - Who can become an AEO? .. 15 Who is an ECONOMIC operator ? .. 15 Who is an ECONOMIC operator established in the Union ? .. 15 Who is an ECONOMIC operator involved in customs related activities ? .. 16 Stakeholders in an international supply chain .. 17 Section III - AEO Benefits .. 19 Easier admittance to customs simplifications .. 20 Prior 21 Fewer physical and document-based controls .. 22 Priority treatment of consignments if selected for control .. 25 Choice of the place of controls .. 25 Indirect benefits .. 26 Section IV Cooperation between customs and other government authorities.

3 28 Section V - Mutual recognition .. 29 Section VI The AEO Logo .. 30 PART 2, AEO CRITERIA .. 31 Section I - Compliance with customs legislation and taxation rules, including no records of serious criminal offences relating to the ECONOMIC activity of the applicant .. 31 General .. 31 Infringements of minor importance .. 32 Repeated 33 Serious infringements .. 34 Section II - Satisfactory system of managing commercial and, where appropriate, transport records, which allows appropriate customs 35 General .. 35 Condition of satisfactory system of managing commercial and transport records .. 36 Section III - Proven financial solvency .. 40 4 General .. 40 Sources of information .. 41 Finance from a loan from another person or a financial institution .. 44 Letters of comfort and guarantees from parent (or other group) companies.

4 45 Applicants established in the EU for less than three years .. 45 Section IV - Practical standards of competence or professional qualifications directly related to the activity carried out .. 46 General .. 46 Practical Standards .. 47 Professional qualifications .. 51 Section V - Appropriate security and safety standards .. 52 General .. 52 Building security .. 54 Appropriate access controls .. 55 Cargo security .. 56 Business Partner security .. 57 Personnel security .. 60 External service providers .. 62 security awareness programmes .. 63 Appointed contact person .. 64 PART 3, APPLICATION AND AUTHORISATION PROCESS .. 65 Section I - Determination of the competent Member State for submitting an AEO application .. 66 General: .. 66 Accessibility of customs related documentation .. 66 Multinational companies and large businesses.

5 67 Section II - Receipt and acceptance of the application .. 69 Section III - Risk analysis and Auditing process .. 70 Collect and analyse information .. 70 Small and medium-sized enterprises .. 71 Specific ECONOMIC activities .. 72 Factors facilitating the authorisation process .. 77 Parent/subsidiary companies with common system/procedures .. 83 Risk and risk analysis .. 84 Auditing and risk based audit .. 87 Section IV - Decision about granting of the status .. 90 Factors to be considered before taking the decision .. 90 Taking the decision .. 91 Informing the applicant .. 91 Appeals .. 92 Time-limits .. 93 5 PART 4, EXCHANGE OF INFORMATION BETWEEN MEMBER STATES AND WITH OTHER GOVERNMENT AUTHORITIES .. 94 Section 1 - Exchange of information between Member States .. 94 Information 94 Consultation procedure.

6 95 Means of communication .. 96 Section II Exchange of information between customs and other government authorities .. 97 PART 5, MANAGEMENT OF THE AUTHORISATION .. 99 Section I - Monitoring .. 99 General .. 99 AEO authorisation covering several PBEs .. 103 Section II Re-assessment .. 104 Re-assessment following changes to the EU legislation .. 104 Re-assessment following the result of a monitoring carried out or due to information provided by the holder of the decision or by other authorities .. 104 Section III Amendment of the decision .. 105 Section IV - Suspension .. 106 Section V - Revocation .. 108 PART 6, MUTUAL RECOGNITION .. 109 Section I - Mutual Recognition Agreements concluded by the EU .. 109 Section II - Process steps towards Mutual Recognition .. 109 Section III - Implementation and follow-up after the signature of an 109 Section IV - MRA Benefits proposed by the EU for members of partner AEO programmes (and reciprocal).

7 110 Section V - Implementation of MRAs How to benefit from MRAs? .. 111 Section VI - Unilateral Suspension of Benefits .. 111 Section VII - Recommendations for conducting an AEO audit or monitoring visit in an EU Member State .. 112 PART 7, ANNEXES .. 114 6 Abbreviations AEO AUTHORISED ECONOMIC Operator AEOC AEO Customs Simplifications AEOS AEO - security and Safety AC Account Consignor CCC Community Customs Code1 CCIP Customs Code Implementing Provisions2 EC European Community EORI ECONOMIC Operator Registration and Identification EOS ECONOMIC Operator System ERP Enterprise resource planning EU European Union ICA Issuing Customs Authority ICAO International Civil Aviation Organisation ISO International Standard Organisation ISO/PAS International Standard Organisation, Public Available Specification IMO International Maritime Organisation KC Known Consignor LSE Large Scale Enterprise MRA Mutual Recognition Agreement MS Member State(s)

8 Of the EU OJ Official Journal OTIF Intergovernmental Organisation for International Carriage by Rail PBE Permanent Business Establishment RA Regulated Agent RBA Risk-based audit SME Small and Medium sized Enterprise SAQ Self-assessment questionnaire TAPA Transported Asset Protection Association TAXUD General Directorate 'Taxation and Customs Union' UNECE United Nations ECONOMIC Commission for Europe UPU Universal Postal Union UCC Union Customs Code3 UCC DA Union Customs Code Delegated Act4 UCC IA Union Customs Code Implementing Act5 1 Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code 2 Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code 3 Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code 4 Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015 supplementing Regulation (EU)

9 No 952/2013 of the European Parliament and of the Council with regard to detailed rules of specifying some of the provisions of the Union Customs Code 7 WCO World Customs Organisation WCO SAFE World Customs Organisations Safe Framework of Standards to Secure and Facilitate Global Trade 5 Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015 laying down detailed rules for implementing certain provisions of Regulation (EU) No 952/2013 of the European Parliament and of the Council laying down the Union Customs Code 8 PART 1, General information The AEO concept is based on the Customs-to-Business partnership introduced by the World Customs Organisation (WCO).

10 Traders who voluntarily meet a wide range of criteria work in close cooperation with customs authorities to assure the common objective of supply chain security . The concept is strongly based on the partnership of customs with the ECONOMIC operator. This implies that the relationship between customs and AEO should be always based on the principles of mutual transparency, correctness, fairness and responsibility. Customs expects the AEO to act in line with customs legislation and to inform customs about any difficulties to comply with the legislation. Customs should provide support to achieve this. The EU established its AEO concept based on the internationally recognised standards, creating a legal basis for it in 2008 through the ' security amendments' to the "Community Customs Code" (CCC) and its implementing provisions.