CFSP14400 - Processing the application: traders' records

In order to gain authorisation for CFSP, traders must hold and maintain a full set of commercial records that will allow HMRC officers to perform satisfactory post-clearance verification checks or system audits.

Article 77(2) of the Community Customs Code allows traders to retain supporting documents instead of presenting them at the frontier. However, officers must be assured before granting the authorisation that all supporting documents (ie licences, preference certificates, etc) relating to the release of goods to free circulation or other customs procedures will be held by the trader or made available to Customs on request, prior to the release of the goods.

These records must enable officers to verify that the particulars included on any CFSP declarations are complete, accurate and timely. The trader’s records should enable HMRC officers to be satisfied that:

• the trader has complied with the terms of their authorisation
• all goods released from the frontier using CFSP have been accurately declared on a SD
• the trader has complied with any import prohibitions or restrictions
• the trader has complied with all provisions relating to the release of goods to free circulation or other customs procedure and
• any relevant border admissibility controls have been properly adhered to.

The data held within these records must therefore be fully auditable. The trader’s system must provide a cross-reference (via the DUCR) from the supporting documentation (ie invoices, licences, etc) to the SFDs and SDs.

These records must be kept in accordance with the provisions laid out in the Customs Traders (Accounts and Records) Regulations 1995, SI 1995/1203 as supported by Article 264 (1) of the Commission Regulation 2454/93 and/ or The Revenue Traders (Accounts and Records) Regulations 1992, SI 1992/3150. The commercial records should be held at the trader’s registered premises, as specified in their authorisation. If the trader wishes to maintain these records at an alternative location, details must be provided on their application. The records must be presented/ made available to Customs on request.

These records should include:

Pre-authorisation checks on the trader’s records

Authorising officers must discuss and agree methods for maintaining their supporting records prior to issuing the CFSP authorisation. The officer must document within the trader’s folder which records will be maintained, for how long, where they will be kept and by whom. It is especially important to agree the maintenance of supporting records with the trader when a DR is being employed. The officer must ensure that answers are obtained and documented within the authorisation/ traders folder to the following questions prior to authorising the trader:

Documents

• What records, supporting documentation will the trader be required to maintain?
• How will these records/ documents, entries be cross-referenced?
• Where will the copy entries, CUSRES’, supporting documents and records be maintained/ made available to Customs (This should be an easily accessible place for audit purposes)?
• How much notice the officer will need to give the trader to get access to these records?
• How much time will the trader be allowed for presenting any necessary supporting documents, copy entries or ‘CUSRES’ to:

These may need to be agreed on an individual basis with the air/ports concerned or for the type of document.

• Auditability eg what access will the officer need and how easy is it to search within their system?
• When, how and where they will surrender any documents etc?

Maintenance

• Who will be responsible for maintaining these records (For storage, completion, cross- referencing, etc)?
• How they will control the records for accuracy, completeness, timeliness, auditability and data integrity (ie cannot be later amended/ deleted)?
• What management checks will be carried out by the company?
• Auditability, eg what access will the officer have and how easy is it to search within their system.
• How they will write-off any documents connected to the declarations (eg annotating preference documents with DUCR)
• In what format will data be retained:

• How will the trader provide systems assurance that no data has been deleted, amended or ‘lost’?
• How long will the trader be required to maintain supporting documents/ records/ declarations?

Transfer of information

• How they will transfer/ transmit their information to Customs eg via DTI, email etc?
• How is accuracy of the information assured? (eg automatic download from stock system, management checks, etc)?
• How is information cross-referenced, linked within the trader’s system, via DUCR, automatic systems link or manual records?
• If information is submitted via a third party DR:

1. how is the information provided to the third party
   
   
2. how does the authorised trader ensure the information is passed on:
   
   

3. what information will be provided to the third party to allow the completion of the records/ declarations
   
   
4. how will the third party return information to the authorised trader
   
   
5. what information will be returned to the authorised trader
   
   
6. how will any errors be dealt with:
   
   

Accuracy

• How will the trader ensure that all declarations are finalised by the required deadlines?
• How will the trader ensure that all records are completed on time (For example, prior notification of removals, request to release, entry in local clearance records, licences, etc)?
• How will they assure the accuracy of standing data. What procedures do they have in place for checking/ updating anti-dumping duties, commodity codes, etc?
• How will records, supporting documentation, declarations be cross-referenced?
• Will their cross-referencing allow full auditability?
• Will the cross referencing allow officers to perform completeness checks (ie all frontier releases accounted for on SDs):

1. how will they assure the completeness of SFDs or entry in records to:
   
   

2. how will they ensure the completeness of SDs to:
   
   

• What are the traders procedures for monitoring/correcting any discrepancies?
• What management controls will be implemented, how frequently, by whom?
• How will they complete control checks on their own staff or any representatives?
• How have they provided systems (computerised or manual) assurance that data cannot be altered once SD finalised?
• What assurance checks will be made by the trader on cancellation/ amendments of entries eg what records will be kept of any cancellations/ amendments and who will monitor to ensure they were legitimate? Who will ensure that replacement declarations were sent where necessary?
• What systems checks can be made by IT staff on:

If authorising officers fail to agree and document these points, problems may arise at a later date.