Glossary

Customs Freight Simplified Procedures (CFSP) is an electronic declaration method that can be used when importing goods from third countries (including EU member states as from January 1, 2021) to the UK. There are two CFSP procedures, Simplified Declaration Procedure (SDP) and Entry in the Declarant’s records, which can be combined. Submitting import declarations with either CFSP procedure consists of two stages starting with a message to customs which provides a minimum amount of data to release the goods. After this simplified declaration, the full fiscal and statistical data must be submitted in a supplementary declaration by a specified deadline. Find out more about CFSP and apply here.

When businesses declare goods for import, they must state the customs value of the goods in the customs declaration. The customs value is also needed to calculate customs duties. Determining the customs value can be challenging. For this reason, the WTO’s agreement on customs valuation, which is applicable to all WTO member states, defines rules for a fair, uniform, and neutral valuation of imported goods. For example, it sets out that the primary basis to determining the customs value is to be “the transaction value, that is the price actually paid or payable for the goods when sold for export to the country of importation“ (Article 1). Further criteria must be taken into account. This agreement will continue to apply to goods imported into the UK after January 1, 2021.

The seller is deemed to have delivered when the goods are placed at the disposal of the buyer on the arriving means of transport and ready for unloading at the named place of destination. Under DAP terms, the seller needs to manage all risks involved in bringing the goods in.

The seller is responsible for delivering the goods to the named place in the country of the buyer and pays all costs in bringing the goods to the destination including import duties and taxes. The seller is not responsible for unloading.

This Incoterm requires that the seller delivers the goods, unloaded, at the named place. The seller covers all the costs of transport (export fees, carriage, unloading from main carrier at destination port and destination port charges) and assumes all risk until arrival at the destination place.

Dual-use items are goods, software and technology that can be used for both civilian and military applications. The term “dual-use goods” is often incorrectly used in the common use of everyday language when actually “dual-use items” are meant. While the term “goods” typically refers to commodities in this context, the term “item” encompasses goods as well as software and technology.

Different export control regimes across the globe control the export, transit, brokering, and technical assistance of dual-use items as part of their mission to contribute to international peace and security and prevent the proliferation of Weapons of Mass Destruction (WMD). 

For this purpose, national and international lists of dual-use goods, software, and technology are issued by governing export control bodies, and companies are required to check such lists carefully in order to comply with any related trade prohibitions and restrictions as well as licensing requirements. 

Non-listed goods, software, and technology may also be subject to controls, prohibitions, and licensing requirements due to possible impact on public security or human rights considerations. In this context, the end-use of such items at the end-user as well as involved countries in the associated trade transaction play a vital role.  

Learn more about legal certainty for shipping dual-use items

Learn more about observing all embargoes with automated embargo checks

Learn more about securely checking critical end-use of your goods

Traders importing goods into the UK must normally pay their full customs duties and import VAT for each consignment at the time of import. In particular for traders importing goods on a regular basis, applying for a duty determent account (DDA) instead may be beneficial. This will allow them to defer paying their charges to the 15th of the next month, which they can then do using a Direct Debit system. Find details about how to apply for a duty deferment account here.

If you are moving goods into or out of the UK and make a customs declaration, you need an EORI number (Economic Operators Registration and Identification number). From January 1, 2021, only EORI numbers starting with GB will be accepted when trading goods between the UK and non-EU as well as EU countries. A GB EORI number looks like this, for example: GB123456789000. You can validate your existing EORI number here. If you do not have an EORI number or your number isn't a GB EORI, find more information and apply for it here.

The Export Accompanying Document (EAD) is a document based on the data specified in the export declaration. It is required for third-country exports and accompanies the goods to the office of exit where information is received that the goods have left the UK. From the EAD, the Movement Reference Number (MRN) is generated.

In the context of US export controls, the abbreviation US EAR refers to the US Export Administration Regulations. The US EAR are a set of regulations that can be found in the US Code of Federal Regulations (CFR) – namely within Title 15 CFR § 730-774. These Export Administration Regulations are administered by the US Commerce Department’s Bureau of Industry and Security (BIS). 

The US EAR govern the export, reexport, and transfer (in-country) of dual-use items (commodities, software, and technology). §734.3(b) of the EAR defines which items or activities do not fall under the jurisdiction of the Export Administration Regulations. 

US EAR-regulated items are either listed on the Commerce Control List and have an ECCN due to their technical characteristics or they can be classified as EAR99. 

EAR99, CCL, CCC, ECCN: Expert tips and checklists for export controls under US EAR

Covering all jurisdictions efficiently with Export Controls software from AEB

In the context of US export controls, ECCN is the abbreviation for Export Control Classification Number. The ECCN is an alphanumeric designation used in the US list of dual-use items (Commerce Control List or CCL) to classify dual-use items.

An ECCN categorizes items based on their nature and technical parameters. The US Export Control Classification Number serves as important criteria in US export controls to check license requirements for exports and reexports.

The contents listed in the ECCNs are mostly identical to descriptions of items in Annex I of the EU Dual-Use Regulation. The dual-use item control list both in the EU and the US are based on decisions taken by international export control regimes (e.g. Wassenaar Arrangement, etc.).

EAR99, CCL, CCC, ECCN: Expert tips and checklists for export controls under US EAR

Help for compliantly shipping items with ECCN numbers: AEB’s software Export Controls

An export declaration is an official document in which you specify details about the goods you export. If you are a company based in the UK and export goods on a permanent basis to customers outside the UK, you must complete and submit an electronic export declaration via the National Export System (NES). As from January 1, 2021, this will also apply to goods exported to EU countries.

An export licence is a document issued by the UK government which allows businesses to export certain goods to certain destinations. Businesses need to have a licence or certificate if they want to export the following types of goods from the UK:

• Animals, plants, food, and agricultural products
• Chemicals and waste
• Controlled goods
• Diamonds
• Sanctioned goods

“Ex Works” means that the seller delivers when it places the goods at the disposal of the buyer at the seller’s premises or at another named place (i.e., works, factory, warehouse, etc.). The seller does not need to load the goods on any collecting vehicle, nor does it need to clear the goods for export, where such clearance is applicable.

Tip: EXW is rather suitable for domestic trades where there is no intention to export. It imposes the least set of obligations to the seller. The buyer should use it with care.

The seller delivers when the goods are placed alongside the vessel (e.g., on a quay or a barge) nominated by the buyer at the named port of shipment. The risk of loss of or damage to the goods passes when the goods are alongside the ship, and the buyer takes on responsibility for all costs from that moment onwards.

“Free Carrier” means that the seller delivers the goods to the carrier in one of two ways with varying levels of risk and cost for the buyer and seller. Either it is used when the seller delivers the goods, cleared for export, at a named place which is their own premises., or FCA is used when the seller delivers the goods, cleared for export, at a named place which is not their premises. 

In both instances, the goods can be delivered to a carrier nominated by the buyer, or to another party nominated by the buyer. 

FCA requires the seller to declare for export. However, the seller has no obligation to clear the goods for import or transit.

The seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel, and the buyer takes on responsibility for all costs from that moment onwards.

Foreign trade law comprises all legal provisions of a country that affect foreign trade. This relates both to the movement of goods and to the movement of services, capital, and payments. Foreign trade laws in the various jurisdictions across the globe typically consider their own security, foreign, economic and trade policy concerns on a national level. 

The area of foreign trade is generally highly dynamic. As a result, constant changes in the global political landscape are leading to adjustments in foreign trade policy and in return also to frequent changes in the foreign trade law of a respective state. Restrictions governed by foreign trade laws are usually reflected in prohibitions and license requirements. 

In the member states of the European Union (EU), foreign trade restrictions are based on both national and EU law. Export control laws restrict the fundamental freedom of foreign trade that applies in the EU with the aim of preventing the proliferation and development of conventional arms and weapons of mass destruction and to protect human rights. 

The EU Dual-Use Regulation, which applies in all member states of the EU, provides the legal framework for dealing with civilian goods, so-called dual-use items. Trading military equipment is regulated at national level of the EU member states.

Efficiently observing foreign trade laws, prohibitions, and license requirements with the AEB software Export Controls

HMRC is the UK’s tax, payments, and customs authority. Among other responsibilities, HMRC facilitates legitimate international trade, protects the UK’s fiscal, economic, social, and physical security before and at the border, and collects UK trade statistics. CHIEF is the computer system used by HMRC to manage customs and related processes.

An import declaration is an official document in which you specify details about the goods you import. If you are a company based in the UK and want to bring goods into the UK, you must complete and submit an electronic import declaration. This needs to be done via HMRC's Customs Declaration Service (CDS).