(1)

The Union and the functioning of the internal market are based upon the customs union. In the interests both of economic operators and of the customs authorities in the Union, Regulation (EU) No 952/2013 of the European Parliament and of the Council (3) assembled in a single act, the Union Customs Code, customs legislation that previously contained in several different legal acts. That Regulation contains the general rules and procedures for ensuring the implementation of the tariff measures and other measures introduced at Union level in connection with trade in goods between the Union and countries or territories outside the customs territory of the Union, and the provisions relating to the collection of import duties. Member States’ customs authorities are responsible for implementing those rules by way of operational tasks such as applying customs procedures, carrying out risk analysis and controls, and applying penalties in the event of infringements of the customs legislation.

(2)

The implementation of Regulation (EU) No 952/2013 has disclosed weaknesses in several areas. Those weaknesses include: insufficient or ineffective action in ensuring the protection of the Union and its citizens against non-financial risks applicable to goods established by Union policies other than customs legislation; the limited capacity of customs authorities to effectively handle the increasing volume of goods imported from third countries via distance sales (e-commerce transactions); the limited capacity of the IT systems architecture created by Regulation (EU) No 952/2013 to digitalise customs processes in order to keep up with the pace of technological progress, and in particular technologies based on the exploitation of data; and the lack of effective governance structures of the customs union, resulting in divergent practices and non-uniform implementation of the customs rules in the Member States. Those weaknesses lead to the emergence of obstacles to the proper functioning of the customs union, and therefore of the internal market, due to the internal and external risks and threats.

(3)

It is appropriate that customs legislation take account of the rapid development of global trade patterns, technology, business models and the needs of stakeholders, including businesses, consumers and residents. Therefore, a great number of amendments need to be made to Regulation (EU) No 952/2013. In the interests of clarity, that Regulation should be repealed and replaced.

(4)

In order to provide for effective means of achieving the objectives of the customs union, a number of rules and procedures regulating how goods are brought into or taken out of the customs territory of the Union should be revised, simplified and harmonised. A modern, integrated set of interoperable electronic services should be provided for collecting, processing and exchanging information relevant for implementing customs legislation, namely the European Union Customs Data Hub (the ‘EU Customs Data Hub’). A European Union Customs Authority (the ‘EU Customs Authority’) should be established as a central, operational body providing capacity for the coordinated governance of the customs union in specific areas.

(5)

Since the adoption of Regulation (EU) No 952/2013, the role of customs authorities has evolved to increasingly cover the application of Union and national law laying down requirements for goods subject to customs supervision, in particular the non-financial requirements for goods that are necessary for such goods to enter into and circulate in the internal market. Such non-financial requirements have increased exponentially over the years in line with the growing expectations of Union businesses and residents regarding safety, security, accessibility for persons with disabilities, sustainability, human, animal and plant health and life, the environment, protection of human rights and intellectual property rights, and Union values. New tools, such as the digital product passport established by Regulation (EU) 2024/1781 of the European Parliament and of the Council (4), are to be introduced to ensure that other legislation applied by the customs authorities, as defined in this Regulation, related to products continues to respond to those expectations. It is therefore necessary to reflect the increasing number and complexity of non-financial risks by including in the mission of customs authorities a specific reference to the protection of the public interests within their competence and, where appropriate, in close cooperation with other competent authorities.

(6)

In light of the evolution of the role of customs authorities and of the business models within which they operate, and in order for customs authorities to ‘act as one’ and to contribute to the smooth functioning of the internal market, it is necessary to describe more precisely the mission that customs authorities have to achieve by indicating more accurately their objectives and tasks. Furthermore, rapid technological evolution, in particular of artificial intelligence, will have a significant impact on the activities of customs authorities, including in the area of real-time risk analysis.

(7)

While striving to achieve their mission, customs authorities should also aim for cost-efficiency by avoiding duplication and by promoting effectiveness in customs processes and an efficient use of related resources at Union and national level. They should gather, analyse and exchange relevant information to support evidence-based decision making. Where the internal market emergency mode has been activated in accordance with Regulation (EU) 2024/2747 of the European Parliament and of the Council (5), customs authorities can contribute to the flow of crisis-relevant goods.

(8)

It is appropriate to maintain in this Regulation a legal framework for the application of certain provisions of the customs legislation to trade in Union goods between parts of the customs territory to which Council Directive 2006/112/EC (6) or (EU) 2020/262 (7) apply and parts of that territory where those Directives do not apply, or to trade in Union goods between parts of that territory where those Directives do not apply. Considering that the traded goods concerned are Union goods and considering the fiscal nature of the measures relevant to that intra-Union trade, it is justified to introduce appropriate simplifications to the customs formalities to be applied to such goods.

(9)

Certain definitions set out in Regulation (EU) No 952/2013 should be adapted to take account of the broader scope of this Regulation, to align them with those set out in other Union legal acts, and to clarify terminology having different meanings in different sectors. New definitions should be included in customs legislation to clarify the roles and responsibilities of certain actors in the customs processes. In the case of the importer and the exporter, new definitions should make those persons responsible towards customs authorities for compliance of the goods with which those persons deal, including for financial and non-financial risks, in accordance with product-specific legislation, in order to strengthen customs supervision. Regarding the new concept of ‘importer for distance sales’, new definitions should ensure that in some cases, in the context of an online sale from outside the Union, an economic operator, as opposed to the consumer, is considered as the importer and is obliged to assume the corresponding responsibilities, and should ensure that the relevant economic operator is obliged to comply with the relevant customs legislation and other legislation applied by the customs authorities when the goods enter or exit the customs territory of the Union and to provide or make available, and keep, appropriate records of such compliance. New definitions should also be introduced in relation to the broader scope of the provisions of customs supervision, risk management and customs controls. It should also be clarified that, where the definitions contained in Union customs legislation refer to customs provisions contained in international agreements, that includes the relevant multilateral environmental agreements to which the Union and the Member States are a party, to the extent that the latter agreements regulate the conformity of goods.

(10)

Beyond their traditional role of collecting customs duties, VAT and excise duty and applying customs legislation, customs authorities also play a critical role in enforcing other Union legal acts and, where applicable, other relevant national legislation. A definition of ‘other legislation applied by the customs authorities’ should be introduced in order to build an effective framework for regulating the application and supervision of the particular requirements on goods laid down in those legal acts. The notion of other legislation applied by the customs authorities should include measures justified on the basis of public morality, public policy or public security, protection of the health and life of humans, animals or plants, protection of the environment, protection of national treasures possessing artistic, historic or archaeological value and protection of industrial or commercial property and other public interests, including controls on drug precursors, goods infringing certain intellectual property rights and cash, as well as commercial policy measures, fishery conservation and management measures, and restrictive measures adopted on the basis of Article 215 of the Treaty on the Functioning of the European Union (TFEU). Divergences in national lists of prohibitions and restrictions create significant difficulties for importing into multiple Member States. In order to facilitate trade and the functioning of customs, it is important that the Union works to gradually harmonise national lists of prohibitions and restrictions. Furthermore, it is important to adopt harmonised definitions of the legal terms used where prohibitions and restrictions are provided for in order to avoid diverging interpretations by Member States.

(11)

In order to increase legal clarity, certain rules regarding customs decisions should be amended. First, it is appropriate to clarify that the competent customs authority for taking a customs decision is the competent customs authority for the place where the applicant is established, because establishment is the main principle according to which certain economic operators, under certain conditions and in a pre-determined time frame, subject to review, can benefit from the simplifications introduced by this Regulation and pay customs duties where they are established. Second, the 30-day time limit by which an applicant is to provide additional information to customs authorities if they consider that the application for a customs decision does not contain all the information required should also be introduced for the sake of completeness and legal clarity.

(12)

The consequence of failure by a customs authority to take a decision on an application within the established time limits should be clarified. The principle that in such cases the application is deemed to be the subject of a negative decision and that the applicant may lodge an appeal, in accordance with the general rules on customs decisions, should also be established.

(13)

As highlighted by the Court of Auditors in its Special Report No 4/2021 entitled ‘Customs controls: insufficient harmonisation hampers EU financial interests’ and in the evaluation of the implementation of Regulation (EU) No 952/2013, it is also desirable to address the lack of uniform monitoring of the fulfilment of the criteria and the compliance with the obligations set out in customs decisions by reinforcing the relevant provisions. On one side, the holders of customs decisions should not only comply with obligations set out in the relevant decision but also monitor on a continuous basis their compliance and provide for an internal organisation through which such self-monitoring activities can prevent, mitigate or remedy any possible errors in their customs processes. On the other side, customs authorities should regularly monitor the implementation of customs decisions by the holders of such decisions, in particular where those holders are established in the customs territory of the Union for less than three years and are therefore potentially more likely to cause risks, in order to ensure that the holder complies with the obligations established by that decision. Where customs authorities become aware that a holder of a customs decision no longer fulfils the criteria or complies with the obligations set out in that decision, they should take appropriate actions without undue delay, in accordance with the applicable rules. This is particularly relevant when those persons benefit from a specific status, such as that of authorised economic operator or Trust and Check trader, and therefore enjoy certain facilitations in customs processes. In addition, in order to strengthen risk management at Union level, customs authorities should notify the EU Customs Authority of all customs decisions taken further to an application and inform it about the monitoring activities, so that that information can be taken into account for risk management purposes.

(14)

In addition to the decisions relating to binding tariff information (‘BTI decisions’) and decisions relating to binding origin information (‘BOI decisions’) adopted by customs authorities upon application and subject to certain conditions, decisions relating to binding valuation information (‘BVI decisions’) have been introduced in customs legislation through Commission Delegated Regulation (EU) 2024/1072 (8). In the interest of the users of customs legislation, it is appropriate to lay down in the same legal act the rules regarding those three types of decisions relating to binding information.

(15)

The rights and obligations of the persons responsible for goods entering into and exiting from the customs territory of the Union should be more clearly defined. Persons having regular customs operations should continue to be registered with the customs authorities responsible for the place where they are established. A single registration should be valid for the whole customs union but should be kept up to date. Economic operators should therefore have the obligation to inform the customs authorities about any change in their registration data. The persons responsible for goods entering into and exiting from the customs territory of the Union should ensure that the goods comply with the applicable law, including rules protecting the safety and security of residents, as well as legislation aimed at preventing risks to human, animal or plant health and life, the environment or consumers, such as Regulation (EU) 2023/988 of the European Parliament and of the Council (9) concerning general product safety, Directive (EU) 2024/2853 of the European Parliament and of the Council (10) concerning product liability and Regulation (EU) 2019/1020 of the European Parliament and of the Council (11) concerning market surveillance and compliance of products. The obligations of the importer should also be laid down, in particular the obligation to be established in the customs territory of the Union and the exceptions to that obligation. Those obligations should follow the existing rules for the declarant to be established in the Union. Similarly, the obligations of the exporter should be laid down.

(16)

Where the person supplying goods in distance sales or facilitating distance sales of goods indicates that he or she is acting as the importer, that person should ensure that the goods comply with the customs legislation and other legislation applied by the customs authorities for placing products on the internal market of the Union.

(17)

Economic operators meeting certain criteria and conditions to be considered compliant and trustworthy traders by customs authorities can be granted the status of authorised economic operator and thereby benefit from facilitations in customs processes. Although it ensures that the traders dealing with most of Union trade are trustworthy, the authorised economic operator scheme suffers from certain weaknesses highlighted in the evaluation of Regulation (EU) No 952/2013 and in the findings of the Court of Auditors. To deal with those concerns, in particular about divergent national practices and about challenges regarding monitoring the compliance of authorised economic operators, the relevant rules should be amended to introduce an obligation on the customs authorities to monitor that compliance at least every three years.

(18)

Changes in the customs processes and in the way customs authorities operate necessitate a new partnership between customs authorities and economic operators, namely the Trust and Check traders scheme. The criteria and conditions for becoming a Trust and Check trader should build on the criteria for the status of authorised economic operator but should also ensure that the trader is considered transparent for the customs authorities. It is therefore appropriate to require Trust and Check traders to grant the customs authorities access to their electronic systems keeping record of their compliance and the movement of their goods, provided that such access is proportionate and strictly necessary. Such transparency should be accompanied by certain benefits, which can include the possibility to release the goods on behalf of customs authorities without the necessity for their active intervention, except where a pre-release approval is required by other legislation applied by the customs authorities, and to defer the payment of the customs debt. The Trust and Check trader status should not be given to persons who committed repeated or serious infringements of other legislation applied by the customs authorities.

(19)

To ensure the integrity of the customs union and consistent application of the Trust and Check trader status by the customs authorities of the Member States, it is necessary to establish a mechanism allowing the EU Customs Authority and the Commission to intervene in cases where there are indications of non-compliance by a trader having Trust and Check trader status. Such a mechanism should enable the EU Customs Authority, in cooperation with the competent customs authorities, to verify compliance with the requirements of Trust and Check trader status, particularly when a Member State other than the one where the trader is established has reasonable doubts about the trader’s compliance. That mechanism is essential to prevent unlawful application of the Trust and Check trader status and prevent backdoor entry into the customs territory of the Union. To prevent disparities in enforcement, where the Member State of establishment fails to act in a timely or appropriate manner, the Commission should be empowered to intervene via implementing act requiring that Member State to suspend or revoke the Trust and Check trader status.

(20)

The option to operate a customs warehouse for distance sales should, in combination with other provisions on distance sales and simplifications, incentivise the use of bulk quantities rather than parcels, making the flow of individual parcels more manageable for customs authorities. A customs warehouse for distance sales should provide for releasing goods for free circulation at the moment of sale and outbound of the warehouse, meaning that at the moment of placing goods in the warehouse the goods need to meet the conditions that would be applicable to them if they were placed on the Union market at that moment. Customs authorities should be able to check whether the goods brought in bulk quantities comply with Union market rules at the moment of entry into the customs warehouse. Such customs warehouse for distance sales should only be available for economic operators that meet the trustworthiness criteria of Trust and Check trader status, to avoid misuse by non-trustworthy economic operators.

(21)

Changes in the customs processes also necessitate clarification of the role of customs representatives. Both direct and indirect representation should continue to be possible, but it should be clarified that the indirect representative of an importer or an exporter assumes all the obligations of that importer or exporter, meaning not only the obligation to pay or guarantee the customs debt but also compliance with other legislation applied by the customs authorities. For that reason, customs representatives need to be resident in the customs territory of the Union, where they represent importers or exporters, to ensure proper accountability for financial and non-financial aspects of the importers’ and exporters’ obligations. The use of an indirect customs representative established in the Union is therefore an available and proportionate alternative for importers and exporters who do not have a commercial presence in the Union. Moreover, customs representatives established in third countries should be able to continue providing their services in the Union where they represent persons who are not required to be established within the customs territory of the Union.

(22)

Micro, small and medium-sized enterprises, as defined in Commission Recommendation 2003/361/EC (12), play a vital role in the Union’s external trade but often face proportionately higher administrative and compliance burdens in fulfilling customs requirements. It is therefore important to take account of their specific situation and support measures that facilitate their compliance, including through simplified procedures, clear guidance and accessible customs representation. Guidelines should be adopted with a view to supporting micro, small and medium-sized enterprises, recognising the unique challenges such enterprises face, while maintaining the integrity and security of external trade processes when applying the status of authorised economic operator and Trust and Check trader. Continuous efforts should be made to simplify and make more accessible the procedures for micro, small and medium-sized enterprises, ensuring their vital role in the Union’s external trade is facilitated and promoted.

(23)

In order to ensure a uniform level of digitalisation and to create a level playing field for economic operators in all Member States as well as contributing to the smooth functioning of the internal market, an EU Customs Data Hub should be established as a set of centralised, secure and cyber-resilient electronic services and systems for customs purposes. The EU Customs Data Hub should allow for the implementation of the customs legislation, such as: customs formalities; customs controls; calculation and notification of the customs debt, Union handling fee, excise duty and VAT; guarantee management; and customs surveillance of goods. The EU Customs Data Hub should also contribute to the implementation of other legislation applied by the customs authorities. It should ensure the quality, integrity, traceability and non-repudiation of data processed therein, so that neither sender nor recipient can later dispute the existence of the exchange of data. Data processing in the EU Customs Data Hub should comply with the relevant rules for cybersecurity and the processing of personal data. The Commission and the EU Customs Authority in cooperation with the Member States should jointly design the EU Customs Data Hub. The Commission should also be given the task of developing, operating and maintaining the EU Customs Data Hub and should be able to entrust that task to the EU Customs Authority.

(24)

Having regard to the role of the EU Customs Data Hub in ensuring the integrity and security of data treated in the Union for customs purposes, which constitutes a public interest and can be considered a fundamental interest of society, it is necessary to protect the data managed in the EU Customs Data Hub, including personal data and other sensitive data relating to the flow of goods and the implementation of Union and national law, from unauthorised access and any other threat to the integrity and security of such data. It is therefore necessary that the infrastructure and services through which the EU Customs Data Hub operates be made subject to certain conditions to ensure Union sovereignty in that respect. Respect of those conditions should be demonstrated through evidence and, in the case of critical services, it is important that that evidence be complemented by security screening of natural and legal persons, as provided for under Union or national law. Furthermore, the EU Customs Data Hub should be designed as far as possible to avoid vendor lock-in situations.

(25)

In order to ensure the reliability, interoperability and long-term sustainability of the EU Customs Data Hub, it is important that its development and maintenance adhere to internationally recognised standards and best practices in software engineering, system testing, piloting and acceptance procedures. That includes comprehensive functional and non-functional testing, structured pilot phases involving representative stakeholders, and clearly defined acceptance criteria to validate performance, compliance and security. Those measures are meant to ensure that the system can support harmonised customs formalities across the Union and meets the operational requirements of Member States and economic operators alike.

(26)

Activities implementing the EU Customs Data Hub should include measures to ensure its uninterrupted availability and operation, even in the event of a serious crisis. Business continuity measures should include, in particular, redundancy, failover mechanisms and data-recovery protocols, as well as procedures to follow in the event of unavailability or failure of the EU Customs Data Hub. Where the EU Customs Data Hub relies on physical infrastructure, redundant solutions in geographically dispersed sites should be considered to ensure business continuity in the event of failure of one site.

(27)

The EU Customs Data Hub aims to replace the existing electronic systems developed by the Member States and the Commission pursuant to Article 16(1) of Regulation (EU) No 952/2013, some of which are being progressively phased out in the course of the transition. Those existing national electronic systems will not be revived in the event that the EU Customs Data Hub functionalities are not available within the set deadlines. Therefore, a temporary solution should be provided for such a case. In line with recent case-law of the Court of Justice of the European Union (13), it is appropriate to clarify that the automated exchange of information between economic operators, customs authorities and other stakeholders through and by the EU Customs Data Hub does not exclude the responsibility of those authorities or of those economic operators in relation to the customs processes concerned. Even where the involvement of a customs authority in the adoption of a measure is limited to electronic communication via the EU Customs Data Hub, it should be considered that the measure in question is adopted by that authority, as if the EU Customs data Hub acted on its behalf.

(28)

The EU Customs Data Hub should enable the exchange of data with other systems, platforms or environments for the purpose of increasing the quality of data used by customs in fulfilling their tasks, as well as for sharing relevant customs data with other authorities, in order to increase the effectiveness of controls in the internal market. In line with the approach set out in Regulation (EU) 2024/903 of the European Parliament and of the Council (14) and the Commission Communication of 23 March 2017 entitled ‘European Interoperability Framework – Implementation Strategy’, the EU Customs Data Hub should foster cross-border and cross-sector interoperability in Europe. It should exploit the potential of existing sources of risk information available at Union level, such as the rapid alert systems for food and feed (RASFF) and for non-food products (Safety Gate), the Information and Communication System for Market Surveillance (ICSMS) and the IP Enforcement Portal. It should underpin the development of strategic and operational cooperation, including information exchange and interoperability, between customs and other authorities, bodies and services, within their respective competences. Moreover, the EU Customs Data Hub should provide a wide range of advanced data analytics, also including through the use of artificial intelligence. That data analysis should facilitate risk analysis, economic analysis and predictive analysis to anticipate possible risks related to consignments coming into, or moving from, the Union.

(29)

To ensure better supervision of trade flows and a streamlined method of collaboration with competent authorities other than customs authorities, the EU Customs Data Hub should be capable of making use of the framework for collaboration under the EU Single Window Environment for Customs and, where that framework cannot be used, offer those other competent authorities a specific service through which they can obtain the relevant data, provide information to and share information with the customs authorities, and make sure that the sectorial requirements are complied with. That specific service would be necessary where the other competent authorities do not have an electronic system that could be federated with the EU Customs Data Hub.

(30)

In order to test the functionalities of the EU Customs Data Hub before its entry into operation for all economic operators regardless of their status or the customs process concerned, it is appropriate to allow the Commission to decide to establish a pilot phase, on a voluntary basis. Such a pilot exercise would test the implementation of certain processes and functions on a voluntary basis without legal obligation. For the sake of transparency and the provision of information to interested stakeholders, it is important that the Commission make public the planning, organisation and duration of that pilot phase and the functionalities that are to be applied and tested.

(31)

Authorities, businesses, consumers and residents should be able to report goods to be imported into or exported from the Union that are not in compliance with relevant Union legislation applied by the customs authorities. The information reported on those goods should be available in the EU Customs Data Hub and it should be possible to use it for risk management purposes.

(32)

Alongside the EU Customs Data Hub, it should remain possible for Member States to develop their own applications to use data from the EU Customs Data Hub. Member States are to ensure that their applications comply with Directive (EU) 2022/2555 of the European Parliament and of the Council (15), in particular in regard to cybersecurity risk-management measures. To decrease the time to market, Member States should be able to entrust the EU Customs Authority with the finances and the mandate to develop such applications. In such cases, the EU Customs Authority should develop the applications for the benefit of all Member States. That could be done by creating non-vendor lock-in open-source code applications following the Sharing and Reuse Framework for IT Solutions.

(33)

The EU Customs Data Hub should enable the flow of data. Users should be able to transmit and process in the EU Customs Data Hub all relevant data required to fulfil their obligations under the customs legislation. That data should be processed at Union level and be enriched with Union-wide risk analysis. The resulting data should be made available to Member States’ customs authorities, which then process the data to fulfil their obligations. Finally, the outcome of the controls performed following the processing of data from the EU Customs Data Hub should be reported back to that Data Hub. It is important that the EU Customs Data Hub enable processing of the data available therein with minimum delay.

(34)

The data submitted to the EU Customs Data Hub are to a large extent non-personal data submitted by economic operators about the goods they are trading. Nevertheless, those data could also include personal data, in particular the names of individuals acting for an economic operator or an authority. To ensure that personal data and commercial information are equally protected, specific access rules, rules for confidentiality and conditions for the use of the EU Customs Data Hub should be established. In particular, it should be established which entities are able to access or process data available in the EU Customs Data Hub, in addition to the persons concerned, the Commission, the customs authorities and the EU Customs Authority, balancing the needs of those entities with the need to ensure that the personal and confidential data collected for customs purposes are used for additional purposes only to the minimum extent necessary.

(35)

Member States should have the possibility to designate, in consultation with the Commission, specific data the disclosure of which would harm the essential interests of their security, to be technically tagged within the EU Customs Data Hub in such a way that any further processing of such data is limited to the competent authorities of the Member State concerned, unless those authorities expressly authorise further processing. The person who transmits the data to the EU Customs Data Hub should clearly set the processing limitations of such data that can be linked to the specific supply chains or the data categories. In order to use that possibility, the Member State concerned should inform the Commission about the specific essential interests of security that are at stake and explain why it considers that those interests could not be sufficiently protected under the general framework of provisions regarding data processing within the EU Customs Data Hub.

(36)

Subject to compliance with the data protection rules, especially rules on sensitive customs data and commercially sensitive data, aggregate non-confidential, non-personal and non-commercially sensitive customs data could be made available to third parties for specific purposes upon duly justified request.

(37)

To ensure that the European Anti-Fraud Office (OLAF) can exercise its investigation powers in relation to fraudulent activities that are affecting the interests of the Union, it is appropriate that it have access to data from the EU Customs Data Hub that is very similar to the access by the Commission. OLAF should therefore be entitled to process that data in accordance with the conditions relating to data protection set out in the relevant Union legislation, including Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council (16) and Council Regulation (EC) No 515/97 (17).

(38)

Likewise, the European Public Prosecutor’s Office (EPPO) should be able, upon request, to obtain data available in the EU Customs Data Hub in order to ensure that it can conduct its investigations on customs-related matters.

(39)

The European Union Agency for Law Enforcement Cooperation (Europol) should be able, upon request, to obtain data available in the EU Customs Data Hub to perform its tasks as specified in Regulation (EU) 2016/794 of the European Parliament and of the Council (18). The European Border and Coast Guard Agency (Frontex) should be able, upon request, to obtain non-personal data available in the EU Customs Data Hub.

(40)

To preserve the functions that are performed in Member States’ national IT systems, the tax authorities of the Member States should have the possibility to process data directly within the EU Customs Data Hub. As such, the authorities responsible for food safety in accordance with Regulation (EU) 2017/625 of the European Parliament and of the Council (19) and the authorities responsible for market surveillance in accordance with Regulation (EU) 2019/1020 should be provided with the right services and tools in the EU Customs Data Hub so that they can use the relevant customs data to contribute to enforcing the relevant Union legislation and for cooperating with customs authorities to minimise the risk that non-compliant products enter the Union.

(41)

Pursuant to Article 24 of Council Regulation (EU) 2017/1939 (20), the EU Customs Authority and the competent customs authorities are to report to the EPPO without undue delay any criminal conduct in respect of which the EPPO could exercise its competence in accordance with Article 22 and Article 25(2) and (3) of that Regulation. The EU Customs Authority and competent customs authorities should refrain from taking measures which could jeopardise the confidentiality of any criminal investigation into the same facts undertaken by the competent national judicial or law enforcement authority or by the EPPO.

(42)

The rules and provisions regarding access to the EU Customs Data Hub and exchange of information should not affect the Customs Information System (CIS) established by Regulation (EC) No 515/97 and reporting obligations in the context of situational awareness under Regulation (EU) 2019/1896 of the European Parliament and of the Council (21).

(43)

The Commission should establish implementing rules laying down modalities for the access of the authorities concerned to the EU Customs Data Hub, after assessing the existing safeguards that each authority or category of authorities has in place for ensuring the correct treatment of personal and commercially sensitive data.

(44)

It is appropriate that the EU Customs Data Hub store personal data for a maximum period of 10 years. That period is justified in light of the possibility for customs authorities to notify the customs debt up to 10 years after having received the necessary information about a consignment, as well as to ensure that the Commission, the EU Customs Authority, OLAF, the EPPO, customs authorities and other competent authorities can cross-check the information in the EU Customs Data Hub against the information stored in and exchanged with other systems. Moreover, that period should be aligned with the storage period required by other legislation applied by the customs authorities, where such legislation is relevant for customs controls. It is also appropriate that, whenever personal data is required for the purposes of judicial and administrative proceedings, of investigations and during post-clearance controls, the retention period be suspended to avoid personal data being erased and therefore not able to be used for those purposes.

(45)

The protection of personal and other data in the EU Customs Data Hub should also include rules on the restriction of rights of data subjects. It is therefore appropriate that the customs authorities, the Commission or the EU Customs Authority be able to restrict the right of data subjects where necessary to ensure that enforcement activities, risk analysis and customs controls are not jeopardised. Moreover, such restrictions could also be applied where necessary for the purpose of protecting judicial or administrative proceedings following enforcement activities. Such restrictions should be duly justified against the activities and prerogatives of the customs authorities, the Commission or the EU Customs Authority and limited to the time necessary to preserve those prerogatives.

(46)

Any processing of personal data under this Regulation should be carried out in compliance with Regulation (EU) 2016/679 (22) or (EU) 2018/1725 (23) of the European Parliament and of the Council or Directive (EU) 2016/680 of the European Parliament and of the Council (24), within their respective scope of application. Any authority or body other than the customs authorities, the Commission and the EU Customs Authority that processes personal data in the EU Customs Data Hub is to be regarded as a controller in accordance with the applicable rules.

(47)

In order to ensure the interoperability and exchange of data with certain other Union non-customs systems and in respect of the customs formalities referred to in Regulation (EU) 2022/2399 of the European Parliament and of the Council (25), the EU Customs Data Hub should integrate the European Union Customs Single Window Certificates Exchange System (EU CWS-CERTEX) established by that Regulation. Until the EU Customs Data Hub fully integrates the EU CWS-CERTEX, the EU Customs Data Hub should perform the business and technical transformation of data to enable the exchange of data through the EU CWS-CERTEX.

(48)

Data requirements should be defined in order to provide common guidance to economic operators regarding the data they need in order to fulfil their purposes, related in particular to the implementation of the customs legislation. The EU Customs Data Hub will be a unique point of entry for such data, and therefore the rules for formatting and coding such data should be laid down in the technical specifications for the EU Customs Data Hub, which are a more flexible instrument than legal rules. However, a harmonised customs data model with semantic data requirements is necessary.

(49)

A Union-level customs risk management layer is fundamental for ensuring a harmonised application of customs controls in the Member States. There is currently a common risk management framework comprising the possibility of identifying common priority control areas and common risk criteria and standards in the financial risk arena for carrying out customs controls, but it has significant shortcomings. In order to address the lack of harmonised application of customs controls and of harmonised risk management, which harms the financial and non-financial interests of the Union and of the Member States, it is appropriate to revise the rules on risk management to establish a more solid risk management approach addressing both financial and non-financial risks. That includes tackling the structural challenges on the risk management of financial risks identified by the Court of Auditors. In particular, it is appropriate to describe which activities are comprised in customs risk management, in a cyclical approach. It is also important to identify the roles and responsibilities of the Commission, the EU Customs Authority and the customs authorities of the Member States. It is also essential to empower the Commission to establish common priority control areas and common risk criteria and standards, and to identify specific areas in the domain of other legislation applied by the customs authorities that deserve priority for common risk management and controls, without compromising security.

(50)

It is therefore appropriate to introduce Union-level risk management activities and provisions to ensure the collection at Union level of comprehensive data relevant for risk management, including results and evaluation of all controls. Common risk analysis and the issue of corresponding Union control recommendations to customs authorities should be provided for. In line with the principle of ‘comply or explain’, those control recommendations should be followed, or compelling reasons provided for not following them. The possibility to issue an instruction that goods destined for the Union are not to be loaded or transported should also be provided for. The analysis of Union-level risks and threats should be based on continuously updated Union-level data and should identify the measures and controls to be performed at the border crossing points of entry and exit of the Union territory.

(51)

In the context of cooperation with law enforcement and security authorities in particular, Union-level risk management should, where possible, contribute to and benefit from strategic analyses and threat assessments conducted at Union level, including those carried out by Europol and Frontex to contribute to the efficient and effective prevention of, and the fight against, crime. Infringement of customs legislation and other legislation applied by the customs authorities should have an impact on the risk profile of importers, including importers for distance sales, or exporters.

(52)

The process of placing goods in a customs procedure needs to be revisited to reflect the new roles and responsibilities of the persons involved in that procedure. Therefore, responsibility for providing the information to the customs authorities is to be assumed by the person responsible for the goods, namely the importer, the exporter or the holder of the transit procedure, rather than the declarant. The person responsible should provide or make available the data to customs as soon as that data are available and in any case before the release of the goods for a customs procedure, in order to allow the customs authorities to carry out a risk analysis and to take appropriate measures.

(53)

However, in the case of e-commerce, and taking into account the higher volume of transactions by e-commerce, it is appropriate that persons making use of the special scheme laid down in Title XII, Chapter 6, Section 4, of Directive 2006/112/EC (‘Import One-Stop Shop scheme’ or ‘IOSS scheme’) should provide data on their sales of goods to be imported at the latest on the day after the acceptance of the payment.

(54)

In duly justified circumstances, the customs authorities should be able to authorise Trust and Check traders to complete the data on their released goods at a later stage, as those traders continuously share data on their transactions with customs and can be considered reliable. Such circumstances could be linked to the supporting documents or to the impossibility of determining the final customs value of the goods at the moment of release.

(55)

To simplify the customs process for the entry of goods into the customs territory of the Union, while ensuring that there is a single person responsible for those goods, different actors in the supply chain should provide their part of the relevant information on the goods concerned and link it to a specific consignment. Goods should enter into the customs territory of the Union only if there is an importer or an indirect representative acting on behalf of the importer established in the Union that takes the responsibility for those goods. The importer or the indirect representative acting on behalf of the importer should provide information on the goods to customs and the customs procedure to which they should be placed, and should do so at the earliest possible stage, if possible before the goods physically arrive. A service provider or customs agent should be able to provide information in the importer’s name and on its behalf, but the importer should remain responsible for ensuring compliance of the goods with the financial and non-financial risks. The carriers effectively bringing the goods should also provide some information on the goods before loading or arrival (‘advance cargo information’) and should link their information to the importer’s information where it has been previously submitted, without necessarily having access to all the data that the importer has provided. In addition, to cater for the more complex supply chains and transport networks, it should be possible to require certain other persons to complete the information on the goods to be brought into the customs territory of the Union. The importer, the carrier or any other person submitting information to customs should be obliged to amend it where they know that the information is no longer correct but before the customs authorities have detected irregularities that they intend to control.

(56)

Non-Union goods that are brought into the customs territory of the Union should be considered to be in temporary storage from the moment the carrier notifies their arrival until their placement under a customs procedure, unless they are already placed in transit. To ensure appropriate customs supervision, that situation should be limited in time and not last more than 90 days, except in exceptional cases.

(57)

It is necessary to maintain the rules that determine whether goods are Union or non-Union goods and whether the status of Union goods can be presumed or needs to be proven, particularly where the goods temporarily leave the customs territory of the Union.

(58)

Once the customs authorities have the information necessary for the relevant procedure, based on risk analysis, they should decide whether to perform further controls on the goods, to release them, to refuse or suspend their release or to let time pass with the result that the goods are considered released. The customs authorities should take such decision in cooperation with other competent authorities, where necessary. Accordingly, the customs authorities should refuse the release of the goods where they have evidence that the goods do not comply with applicable legal requirements. The determination of repeated systematic infringement in relation to distance sales by an economic operator should constitute such evidence for a period of at least six months for all goods notified for arrival for the release for free circulation by that economic operator. Where the customs authorities need to consult other competent authorities to determine whether or not the goods comply with applicable legal requirements, they should suspend the release of those goods at least until that consultation takes place. In such cases, the customs authorities’ subsequent decision on the goods should depend on the other competent authorities’ reply. To avoid blocking both traders and authorities in cases for which reaching a conclusion on compliance requires some time, the customs authorities should have the possibility to release the goods on the condition that the trader continues informing them about the location of the goods.

(59)

In order to provide legal certainty to the traders that have provided the information on time without obliging the customs authorities to react to every consignment, goods that have not been selected for a control after a reasonable period should be considered released. The Commission should be entitled to define that period in delegated acts, adapting it, where necessary, to the type of traffic or type of border crossing point in question.

(60)

As Trust and Check traders are considered reliable and provide customs in as close to real time as technically possible with data on the movement of the goods and on compliance and with full access to their systems, records and operations, such traders should be able to release their goods under the supervision of the customs authorities without waiting for their intervention. Accordingly, Trust and Check traders should be able to release goods on behalf of the customs authorities upon receipt of those goods at the place of business of the importer, owner or consignee or upon dispatch from the place of business of the exporter, owner or consignor. As Trust and Check traders are supposed to operate in a transparent way, each arrival and delivery of goods should be properly recorded in the EU Customs Data Hub. Trust and Check traders should be obliged to inform the customs authorities where a problem arises so that those authorities can take a final decision on the release of the goods. Where the internal control systems of Trust and Check traders are robust enough, the customs authorities should be able, in cooperation with other competent authorities, to authorise those traders to perform certain checks on their own. However, the customs authorities should retain the possibility to control the goods at any time.

(61)

It is appropriate to provide measures to regulate the transition from a system based on customs declarations to a system based on the provision or making available of information to the EU Customs Data Hub. Economic operators should have the possibility to lodge customs declarations to declare their intention to place goods under customs procedure during the transition period. However, as soon as the capabilities of the EU Customs Data Hub are available, economic operators should also be given the possibility to provide or make available information to the customs authorities through the EU Customs Data Hub, and the customs authorities should no longer authorise any economic operator to apply for simplifications in relation to the customs declaration. At the end of the transition period, all authorisations should cease to be valid, as customs declarations will no longer exist. In relation to distance sales of goods, the transition period for lodging customs declarations should be limited until the capabilities of the EU Customs Data Hub to process the relevant data for distance sales are available.

(62)

The precise identification of the person acting as ‘importer’ depends on the stage and the nature of the customs process in question. There should be only one importer at a time.

(63)

In the case of distance sales, it is considered that the person supplying goods in distance sales or facilitating distance sales of goods is the person that determines that goods from a third country are to be brought into the customs territory of the Union because they determine the chain of supply and are responsible for the risk for loss, damage or delay up to the delivery of the goods to the consumer. Therefore, for distance sales, in order for goods to be released for free circulation, the importer will be either the person supplying goods in distance sales or the person facilitating distance sales of goods, depending on the arrangements made, and the importer determined in that way should be indicated as such.

(64)

The person supplying goods in distance sales or facilitating distance sales of goods to be imported from third countries into the customs territory of the Union who is the importer should be responsible for providing the required information on distance sales to the customs authorities before the release of the goods. The person so identified should fulfil the obligations of an importer.

(65)

Where a person supplying goods in distance sales or facilitating distance sales of goods to be imported from third countries into the customs territory of the Union is not established in the customs territory of the Union, it should be possible to place the goods under a customs procedure where an indirect representative having the status of authorised economic operator places the goods in its own name and on behalf of the importer for distance sales and assumes the obligations of the importer for distance sales in that regard.

(66)

The provisions of this Regulation, including those relating to the importer for distance sales, do not amount, either de jure or de facto, to a general monitoring obligation for providers of intermediary services.

(67)

Article 29 TFEU requires that products coming from third countries are to be considered in free circulation if the import formalities have been complied with and customs duties or charges having equivalent effect have been levied. However, the release for free circulation should not be understood as a proof of compliance with customs legislation and other legislation applied by the customs authorities.

(68)

The process of taking goods outside the customs territory of the Union should be streamlined and simplified, in line with the entry process. Therefore, it is appropriate to require that there be a person established in the Union who is responsible for the goods, namely the exporter. The exporter should provide or make available to customs the relevant information prior to taking the goods out of the Union, indicating whether the goods are Union or non-Union goods to be exported, and adapting the information as necessary.

(69)

To ensure that there is proper risk management of goods taken out of the customs territory of the Union, the customs authority responsible for export should be required to carry out a risk analysis of the information on the goods and to take or request the appropriate measures before the goods exit the customs territory of the Union. Those measures should include requesting controls to be carried out by the customs authority responsible for the place of dispatch of the goods and for the place of exit and, if necessary, by other competent authorities, in addition to the measures provided for placing the goods under a customs procedure that are also applicable where the goods are to be exported.

(70)

To ensure that the duty-suspensive procedures are also transparent, it is appropriate to streamline the requirement provisions for authorisations for special procedures. In particular, for the sake of clarity and legal certainty, the conditions for determining whether an opinion at Union level is necessary to assess if granting an authorisation could adversely affect the interests of Union producers, the so-called ‘examination of the economic conditions’, should be codified and regulated in delegated acts. Moreover, as the effect on interests of Union producers might depend on the quantity of goods that are placed under the special procedure, a certain threshold should be set under which it is estimated that there is no negative effect on such interests.

(71)

Article 9 of the Revised Convention for the Navigation of the Rhine refers to an Annex (the ‘Rhine Manifest’) that facilitated the movement of goods on the Rhine river and its associated tributaries by considering them as a customs transit procedure across the national frontiers of four Member States, namely Belgium, Germany, France and the Netherlands, as well as Switzerland. According to information from customs administrations, the Rhine Manifest is no longer used in practice as a customs transit procedure in the Member States bordering the Rhine. Instead, goods on the Rhine and its tributaries are now transported using the Union transit procedure established by Regulation (EU) No 952/2013, through the New Computerised Transit System. It is therefore appropriate to remove the reference to the Rhine Manifest from cases where a movement of goods is considered as external or internal transit.

(72)

In order to increase transparency about the person responsible for complying with the obligations of the Union transit procedure and with the content and risks related to the consignment, it is appropriate to require that the holder of the transit procedure disclose at least information regarding the importer or the exporter initiating the movement of the goods, the means of transport and the identification of the goods placed under that procedure. Such information would enable the customs authorities to supervise more effectively the Union transit procedure concerned and to carry out a risk analysis. The Union transit procedure should be compulsory unless goods are put under another customs regime immediately upon entry into or exit out of the customs territory of the Union. Where the importer or the exporter is not yet known, the holder of the goods should be considered as being the importer or the exporter of the goods and should be liable for the payment of customs duties and other taxes and charges. The Union transit procedure should be replaced by customs supervision if goods are imported or exported by a Trust and Check trader.

(73)

An amendment to Annex 6 to the Customs Convention on the International Transport of Goods under Cover of TIR Carnets (TIR Convention) (26) that entered into force on 1 June 2021 modified Explanatory Note 0.49 in order to grant to economic operators meeting certain requirements the possibility to become an ‘authorised consignor’, mirroring the existing facilitations granted to the economic operators recognised as an ‘authorised consignee’. It is therefore necessary to include that new possibility in this Regulation in order to align Union customs legislation with that international agreement.

(74)

Eliminating the duty relief for the importation of goods with a value not exceeding EUR 150 involves the application of provisions concerning the determination of customs value to levy ad valorem customs duties in relation to imported goods purchased in business-to-customer e-commerce transactions, as defined in Directive 2006/112/EC. Such distance sales should constitute the basis for the declaration of customs value under the transaction value method. That principle applies also in situations in which goods are purchased in distance sales not before they are brought into the customs territory of the Union but while placed under the customs warehousing procedure.

(75)

Transactions in distance sales differ significantly from traditional business-to-business transactions, resulting in increased complexity. Those differences impact how customs authorities effectively apply valuation rules in practice. Particular challenges are the massive scale and speed at which e-commerce transactions are concluded, the vast number of buyers and sellers involved, and the dispersion of sales. Taking into account the specificity of e-commerce, as well as the role of customs authorities in contributing to the smooth functioning of the internal market, if, in customs proceedings aimed at verifying the correctness of the declared transaction value of goods purchased in a distance sale, an importer does not dispel reasonable doubts that the declared transaction value reflects the price actually paid or payable for those goods and, consequently, the initially declared transaction value is rejected, the customs authorities should be able to exercise flexibility in the determination of the appropriate secondary valuation method to redetermine the customs value of those goods.

(76)

Currently, customs debts are collected by the Member State where the customs declaration is lodged. It is the choice of the trader whether to do that in the country of first entry, or to use a customs procedure and pay duties in another Member State. For Trust and Check traders, it is appropriate to use different rules to define the place where the customs debt occurs so that the import duties are paid to the Member State where that trader is established. It is appropriate because that is the place where the customs authority has the most complete knowledge of the records, operations and commercial behaviour of the relevant economic operators. However, the customs debt of economic operators other than Trust and Check traders should be incurred at the place where the goods are physically located, at least until the supervision model is evaluated.

(77)

In the case of e-commerce transactions, the importer for distance sales is the person responsible for the customs debt. When use is made of the IOSS scheme, the customs debt should be incurred at the moment of the acceptance of payment of the online sale. Where no use of that scheme is made, the customs debt should arise when the availability of the goods is notified in the Member States where the goods are to be delivered.

(78)

To cover the increasing costs of handling an enormous number of requests for placing goods sold in distance sales under the release for free circulation procedure, a Union handling fee, commensurate to the approximate cost of the services closely connected to the customs supervision of such goods, should be established as those goods are directly shipped to the consumer, making it impossible for other authorities to check them after customs clearance. While it will be up to the Member States to decide whether to recover from economic operators the costs of exceptional control measures or the costs incurred by authorities other than customs authorities in connection with the verification or destruction of the goods, the Union handling fee should cover, in particular, the cost of checking the data and carrying out a risk analysis, and of the relevant infrastructure and controls, including relevant services rendered by the EU Customs Authority.

(79)

A lower Union handling fee should be provided for where the goods are sold in distance sales from a customs warehouse for distance sales, as it is easier and more effective for the customs authorities to supervise bulk quantities of goods stored in a warehouse than goods packed in individual parcels and directly shipped to the consumer.

(80)

The debtor of the Union handling fee should be the same person as the debtor of the customs debt, which should be the importer for distance sales. Where provisions on importers for distance sales do not yet apply, the debtor should be the declarant. In the case of distance sales, the declarant would typically be the person entitled to use the IOSS scheme, or an indirect customs representative. Consequently, the consumer should not be a debtor of the Union handling fee.

(81)

It is appropriate to provide that the first delegated act setting the amount of the handling fee enter into force rapidly so as to allow the practical application of the Union handling fee introduced by this Regulation to respond to the increasing pressure on customs authorities due to the significant volume of parcels entering the customs territory of the Union.

(82)

As several measures such as duties and fees apply per item, it is appropriate to introduce a definition thereof. An item should be defined as one or more goods in a consignment, sharing certain data elements, including the tariff classification and origin, in accordance with the applicable data requirements. That definition should be applicable both in relation to the customs declarations in the existing national and Union digital tools, including where the tariff classification for the goods concerned in the customs declaration is only at the level of sub-headings of the Harmonised System, and in relation to the appropriate data requirements determined for that purpose once the EU Customs Data Hub becomes available.

(83)

It is appropriate to enhance the mechanism aimed at supervising the consistent and effective implementation of restrictive measures on the flow of goods adopted by the Council in accordance with Article 215 TFEU. Where such measures are adopted, the EU Customs Authority should provide support to the Commission and Member States to ensure that those measures are not circumvented. It should provide guidance for the customs authorities in the form of non-binding recommendations, for example by promoting consistent customs practices, within the responsibilities of the Member States for the implementation of such measures. Customs authorities should ensure that they take all the necessary steps within their competences to comply with those measures and should inform the Commission and the EU Customs Authority accordingly. The EU Customs Authority should identify potential discrepancies in the application of those measures and monitor their implementation, and report accordingly to the Commission.

(84)

A crisis management mechanism should be put in place to address potential crises in the customs union. The lack of such a mechanism at Union level was highlighted in the Commission Communication of 28 September 2020 entitled ‘Taking the Customs Union to the Next Level: a Plan for Action’. A mechanism should therefore be established that involves the EU Customs Authority as a pivotal actor in preparing, coordinating and monitoring the implementation of the practical measures and arrangements that the Commission decides to put in place when a crisis occurs. The EU Customs Authority should maintain crisis response readiness throughout the whole duration of the crisis.

(85)

The existing governance framework of the customs union lacks a clear operational management structure and does not reflect the evolution of customs since its creation in 1968. Under Regulation (EU) No 952/2013, the activities related to the management of risks in trade flows, such as the implementation of, and decisions on, controls on the ground, are the responsibility of national customs authorities. The intensity of external border traffic of goods is not equal across the Union. Despite the cooperation between national customs authorities that has existed since the creation of the customs union and that has led to the exchange of best practices and expertise and the development of common guidelines, it has not resulted in the development of a harmonised approach and operational framework. There is no central risk analysis capacity, no common view on Union risk prioritisation, limited coordinated customs action and controls, and no cooperation frameworks for different authorities serving the single market.

(86)

A central, operational Union structure to pool expertise and resources and to assist Member States and the Commission in taking decisions together should address such weaknesses. It should focus in particular on areas such as data management and risk management, and should prepare the training content for customs officers and customs professionals in the Union to complement and support training provided by Member States. It should also contribute to the creation of a Union system to recognise the excellence of educational institutions that offer training and education in the customs field, building on the Commission’s initiative entitled ‘EU Customs Certificate of Recognition’, and coordinate and support the voluntary creation of specialised centres of excellence by Member States. This aims to make the customs union ‘act as one’, while recognising that divergent practices in Member States could result from objective specificities, for example geographical differences, mode of transport used, type of goods or border type. The creation of a new authority, the EU Customs Authority, is crucial to ensure the efficient and adequate functioning of the customs union, to centrally coordinate customs action and to support the customs authorities’ activities.

(87)

The EU Customs Authority should be governed and operated taking into account the principles of the Joint Statement and common approach of the European Parliament, the Council and the Commission on decentralised agencies of 19 July 2012.

(88)

When selecting the seat of the EU Customs Authority, the European Parliament and the Council are to ensure that, given the nature of that authority, its location enables it to fully execute its tasks and powers, to recruit highly qualified and specialised staff and to offer adequate training opportunities. In addition, the European Parliament and the Council are to take into account the following criteria for the selection of the seat of the EU Customs Authority: the availability of appropriate office premises and the ability to accommodate the relevant staff before the EU Customs Authority becomes operational; the accessibility of the location and the existence of adequate education facilities for the children of staff members; appropriate access to the labour market, social security and medical care for both children and spouses of staff members; and geographical balance. Considering those criteria, the EU Customs Authority should be located in Lille, France.

(89)

Member States should ensure that customs authorities are properly resourced, trained and equipped to have the capacity to fulfil their mission.

(90)

It is important that customs invest in a sufficient number of properly trained staff in order to guarantee the functioning of the Union’s customs systems, which are facing an exponential increase in demand. Without the necessary investments into staff, digital solutions cannot achieve their full potential. Therefore, investments into digital systems should guarantee sufficient funding for staff and for their training, in order to ensure the necessary skills for using state-of-the-art equipment and technology for big data analytics, detection and controls, and thus guarantee that customs controls are conducted uniformly across the Union.

(91)

The Member States and the Commission should be represented on a Management Board, in order to ensure the effective functioning of the EU Customs Authority. The composition of the Management Board, including the selection of its Chairperson and Deputy Chairperson, should respect the principle of gender balance and take into account relevant experience and qualifications. Given the Union’s exclusive competence on the customs union, and the close link between customs and other policy fields, either the Chairperson or the Deputy Chairperson should be elected from the members of the Management Board designated by the Commission. In view of the effective and efficient functioning of the EU Customs Authority, the Management Board should, in particular, adopt a single programming document including annual and multiannual programming, carry out its functions relating to the EU Customs Authority’s budget, adopt and publish a consolidated annual activity report on the activities of the EU Customs Authority ensuring that no sensitive information is disclosed, adopt the financial rules applicable to the EU Customs Authority, appoint an Executive Director, and establish procedures for the taking of decisions by the Executive Director relating to the operational tasks of the EU Customs Authority. The Management Board should be assisted by an Executive Board.

(92)

The EU Customs Authority should establish the Customs Advisory Board, whose task will be to provide the EU Customs Authority with advice on the implementation of technical actions and decisions, on implementation and standardisation issues, including harmonisation activities, on the operational aspects of other legislation applied by the customs authorities, and on any other activities of the EU Customs Authority. The Customs Advisory Board should endeavour to ensure a balanced stakeholder representation between commercial and non-commercial interests and, within the category of commercial interests, with regard to micro, small and medium-sized enterprises and other undertakings. The Customs Advisory Board should be consulted regularly and should be able to provide advice to the EU Customs Authority on its own initiative.

(93)

To guarantee its effective functioning, the EU Customs Authority should be granted an autonomous budget, with revenue coming from the general budget of the Union and any voluntary financial contribution from the Member States. In exceptional and duly justified circumstances, the EU Customs Authority should be able to receive additional revenue through contribution agreements or grants and through charges for publications and other services it provides.

(94)

The EU Customs Authority should make use of the information at its disposal regarding challenges on customs legislation and other legislation applied by the customs authorities to periodically carry out a threat assessment. On the basis of such a threat assessment, the EU Customs Authority should prepare recommendations and transmit them to the Commission. Based on those recommendations, the Commission should identify areas that warrant priority treatment. It is important that the Council have a political, strategic discussion on those areas that warrant priority treatment and that the EU Customs Authority provide appropriate follow-up, including when preparing its annual and multiannual work programme and preparing the annual report of its activities.

(95)

To fulfil their mission, the EU Customs Authority and the customs authorities should cooperate closely and regularly with market surveillance authorities, sanitary and phytosanitary authorities, law enforcement bodies and authorities, border management authorities, environmental protection bodies, statistical authorities and tax authorities, experts on cultural goods, and many other authorities in charge of sectoral policies. Considering the evolution of the single market and the evolving role of customs, the increase in prohibitions and restrictions and the increase in e-commerce, it is necessary to structure and reinforce that cooperation at Union, international and national level. Instead of a cooperation focused on individual consignments or specific events along the supply chain, a framework to support cooperation between customs authorities and other authorities responsible for relevant policy areas should be developed and regularly updated by the EU Customs Authority. Such cooperation should include: the development of legislation and of policy needs in specific areas; the exchange and analysis of information; the building of an overall cooperation strategy in the form of joint supervision strategies; cooperation on operational implementation, monitoring and controls; the exchange of relevant skills and best practices; and innovation and research activities in areas relevant for customs.

(96)

The Commission should also facilitate the application of part of the other legislation applied by the customs authorities by drawing up and regularly updating a list of Union legislation imposing requirements on goods subject to customs controls aimed at protecting public interests such as human, animal or plant health and life, consumers and the environment.

(97)

To strengthen cooperation between customs authorities, joint operational efforts should be enhanced to support effective customs controls at the borders of the Union. The EU Customs Authority should coordinate and support the operational coordination in customs cooperation, including in the area of risk management. The EU Customs Authority, in cooperation with the Member States, should plan, organise and coordinate joint controls carried out by customs authorities within the Union and with third countries. In the context of cooperation between customs authorities within the Union, this Regulation is without prejudice to the Convention drawn up on the basis of Article K.3 of the Treaty on European Union, on mutual assistance and cooperation between customs administrations (27) (Naples II). The EU Customs Authority should maintain the necessary collaboration with relevant Union and national authorities conducting relevant investigations and anti-fraud activities, including OLAF and the EPPO. It is important that the EU Customs Authority also cooperate with the EU Innovation Hub for Internal Security where relevant to the EU Customs Authority’s activities.

(98)

Furthermore, in order to exchange best practices and enhance operational effectiveness, Member States should be able, upon request, to make customs officers temporarily available to work in the customs authorities of another Member State. The terms and conditions of such temporary assignments should be determined by the Member States concerned. The EU Customs Authority should, upon request, provide support or coordination. Where appropriate, it can develop guidance or model arrangements to facilitate this form of cooperation.

(99)

The EU Customs Authority and Europol should be able to exchange strategic and other non-operational information such as risk indicators where required for preventing and combatting serious crime affecting two or more Member States, terrorism and forms of crime which affect a common interest covered by a Union policy. Such information could be used by the EU Customs Authority for risk analysis purposes.

(100)

In order to increase clarity and make the cooperation framework between customs authorities and other partner authorities more efficient, a list of services offered by customs authorities should define clearly the possible role of customs authorities in the application of other relevant policies at the borders of the Union. In addition, the application of that cooperation framework should be monitored by the EU Customs Authority. The EU Customs Authority should work closely and cooperate with the Commission, OLAF, other relevant Union bodies, offices and agencies, such as Europol, the EPPO and Frontex, as well as with specialised agencies and networks in policy fields relevant for the EU Customs Authority’s activities, such as the EU Product Compliance Network.

(101)

In an increasingly connected world, customs diplomacy and international cooperation are important aspects in the work of customs authorities around the world. It should be possible for international cooperation to include the possibility of exchange of customs data on the basis of international agreements or autonomous Union legislation and through appropriate, secure and strictly supervised means of communication, such as the EU Customs Data Hub, subject to the respect of confidential information and the protection of personal data.

(102)

Effective cooperation between neighbouring countries is essential to ensure the smooth functioning of customs operations, the facilitation of legitimate trade, and the protection of the financial interests and policies of the Union. Such cooperation is of particular importance at shared customs border crossing points, where coordinated customs controls enhance efficiency and legal certainty. Member States should therefore retain the capacity to conclude or maintain bilateral agreements with neighbouring third countries concerning customs cooperation at shared border-crossing points, if such agreements are compatible with Union law. That capacity includes agreements relating to shared border-crossing points, situated either in the territory of a Member State or in the territory of a neighbouring third country, at which the customs authorities of that Member State and of that neighbouring third country apply their respective customs legislation pursuant to a bilateral agreement.

(103)

A common framework establishing a minimum list of infringements of customs legislation subject to penalties and certain rules for non-criminal penalties should be laid down in this Regulation, to be implemented by Member States. It is up to the Member States to choose the appropriate type of measure to address those infringements. It is also appropriate to establish a minimum list of circumstances to which Member States should give due regard, in accordance with national law, when deciding whether to impose a penalty and when deciding on the type or severity thereof. The Commission should monitor the correct implementation of those provisions, as appropriate. Penalties for infringements of customs legislation should be effective, proportionate and dissuasive.

(104)

This Regulation does not harmonise national procedural rules concerning administrative penalties, nor does it regulate which authorities impose penalties, as long as the principle that penalties are effective, proportionate and dissuasive is maintained. For example, the rules on penalties can be applied in such a manner that the penalty is imposed directly by competent authorities, or by a competent national court upon an application brought by a competent administrative authority, or by the competent customs authorities through a settlement procedure, while having equivalent effect.

(105)

Given the central role of importers for distance sales in organising large volumes of low-value imports, including via online platforms and websites, there is a need to establish a coherent, proportionate and dissuasive framework of penalties to apply where importers for distance sales fail to comply with their obligations. In particular for continued and systematic non-compliance with customs legislation in the case of distance sales, penalties should be dissuasive and effective. The scale, cross-border reach and wide-spread impact of systematic non-compliance justifies that severe minimum and maximum levels of pecuniary penalties, based on the total value of the goods imported to the Union by the non-compliant economic operator, be set in this Regulation, while preserving the possibility for Member States to provide for additional penalties in their national legislation. The harmonisation of penalties for systematic non-compliance across the Union aims to prevent ‘border-shopping’ by economic operators engaging in distance sales. Economic operators that engage in systematic non-compliance should be classified as high-risk economic operators and should lose any trusted trade status and facilitation measures.

(106)

Where systematic non-compliance persists despite the imposition of progressively severe pecuniary charges, further penalties should be imposed. This is necessary on account of continued disregard for obligations under this Regulation, which undermines the integrity of the customs union and the internal market, creates unfair competitive advantages for non-compliant economic operators, and possibly harms consumers. Accordingly, and in view of fulfilling the mission of the customs authorities, a further layer of strict penalties is to be put in place to discourage any occurrence of such multi-systematic non-compliance. In response to such behaviour, the customs authorities should be able to suspend the release for free circulation of all goods imported by an economic operator in distance sales. In addition, where relevant and where justified by the nature of such further systematic infringement, relevant competent authorities should be able to temporarily suspend access to the online interface of the infringing economic operator. To that end, the timely transmission of information about the infringement to the relevant authorities should enable them to obtain the full picture regarding the situation and to ensure a coordinated response.

(107)

To enable effective monitoring and an appropriate degree of transparency, records of all non-criminal penalties imposed by Member States’ customs authorities should be made available in the EU Customs Data Hub. Those records should indicate the nature of the infringement and the amount of the pecuniary charge imposed or the identification of any other non-criminal penalty applied. Such centralised system should provide the necessary data for assessing enforcement practices and identifying potential market distortions or ‘border-shopping’ practices by economic operators.

(108)

The Commission should review the provisions of this Regulation on infringements and penalties in order to ensure proper functioning and application thereof and to prevent possible internal market fragmentation or jurisdictional avoidance by economic operators. Such review should take place following an assessment of the data on penalties recorded in the EU Customs Data Hub, particularly where risks of disparities or distortions in the internal market are identified. It is important to ensure a level playing field and to address any regulatory gaps or inconsistencies in the application of penalties.

(109)

Where an infringement of customs legislation is committed that falls within the jurisdiction of more than one Member State, cooperation between those Member States is necessary. In such cases, competent authorities of the Member States concerned by the same infringement of customs legislation should cooperate in accordance with applicable law. The EU Customs Authority should have the possibility to support and facilitate that cooperation.

(110)

The performance of the customs union should be evaluated at least on an annual basis to allow the Commission, with the help of the Member States, to take the appropriate policy orientations. The Commission can publish a non-confidential version of the evaluation report. The collection of information from customs authorities should be formalised and deepened, as more comprehensive reporting would improve benchmarking and could help to homogenise practices and to assess the impact of customs policy decisions. It is therefore appropriate to introduce a legal framework for the evaluation of the performance of the customs union. To allow sufficient granularity of analysis, the performance measurement of customs activities should be done not only at national level but also at local level.

(111)

The EU Customs Authority should support the Commission in the evaluation process by gathering and analysing the data in the EU Customs Data Hub and identifying how customs activities and operations support the achievement of the strategic objectives and priorities of the customs union and contribute to the mission of customs authorities. In particular, the EU Customs Authority should identify key trends, strengths, weaknesses, gaps and potential risks, and provide recommendations for improvement to the Commission. In the context of cooperation with law enforcement authorities in particular, the EU Customs Authority should also participate, from an operational perspective, in strategic analyses and threat assessments conducted at Union level, including those carried out by Europol and Frontex.

(112)

Trust and Check traders should be supervised by their Member State of establishment. By derogation and subject to review, economic operators that are not Trust and Check traders should remain under the supervision of the customs authority of the Member State where the goods are physically located. By 31 December 2031, the Commission should evaluate those two supervision models, including as regards their effectiveness for detecting and preventing fraud. That evaluation should also consider indirect taxation aspects. Based on that evaluation, the Commission should be entitled to decide by delegated act whether the two supervision models should continue or whether, in all cases, the customs authority responsible for the place of establishment of the Trust and Check trader should release the goods. The place of incurrence of customs debt should also be regulated in accordance with the determination of the customs authority responsible.

(113)

In order to ensure that Union customs rules remain adapted to economic, social, political and technological developments and to the needs of economic operators and of customs administration, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of the following:

(114)

It is of particular importance that the Commission carry out appropriate consultations during the preparatory work for the adoption of delegated acts, including at expert level including the Trade Contact Group, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making (28).

(115)

In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission in order to:

Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (29).

(116)

The advisory procedure should be used for the adoption of:

(117)

In duly justified cases, where imperative grounds of urgency so require, the Commission should adopt immediately applicable implementing acts relating to:

(118)

In accordance with the principle of proportionality, it is necessary and appropriate, for the achievement of the basic objectives of enabling the customs union to function effectively and implementing the common commercial policy, to lay down the rules and procedures applicable to goods brought into or taken out of the customs territory of the Union. This Regulation does not go beyond what is necessary to achieve the objectives pursued, in accordance with Article 5(4) of the Treaty on European Union.

(119)

From 1 March 2031, economic operators should be able to start using, on a voluntary basis, the capabilities of the EU Customs Data Hub. By 1 March 2034, the EU Customs Data Hub should be fully developed, and all economic operators should use it.

(120)

This Regulation should be applied within an ambitious timeline, but applied gradually. Accordingly, the provisions of this Regulation conferring implementing and delegated powers to the Commission should apply as soon as this Regulation enters into force, to allow the Commission the possibility to revise the existing delegated and implementing acts and, where appropriate, to adopt new delegated and implementing acts based on the new delegations of powers and empowerments as soon as this Regulation enters into force. By contrast, to enable the Member States and the economic operators to adapt to the new rules, the vast majority of the provisions of this Regulation should apply from 12 months after its entry into force. That includes the repeal of the current Union Customs Code, which should only be effective after that 12-month adaptation period. Finally, the provisions referring to distance sales and the EU Customs Authority, except those governing the EU Customs Authority’s legal status and the start of its activities, should apply from 1 July 2028.

(121)

The Commission should make every effort to ensure that the delegated and implementing acts provided for in this Regulation enter into force sufficiently in advance of the application date of the relevant provisions in this Regulation to allow for their timely implementation by Member States.

(122)

The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/1725 and delivered an opinion on 11 July 2023,