Duties

Duties

Free Circulation of Goods in the Single European Market

The concept of the Single European Market essentially means that goods, services, persons and capital enjoy the ability to move freely within this market. As a result, imported goods sold in Germany are exempt from customs duties and procedures if:

  • the goods originated in a member state of the European Union or
  • the goods have previously been imported into another member state of the European Union before moving on to Germany.

Conversely, goods originating in or previously imported to Germany are, in essence, exempt from customs in all 28 EU member states as well as within the EU customs union (Andorra, San Marino and Turkey).

In order to quantify the trade volume within the Single European Market, the Intrastat system was established by the European Union.This system collects statistics on the trade in goods between European Union member states. Every vendor or buyer who realizes an annual trade volume of more than 500,000 Euro must report the turnover to the corresponding office for national statistics in his/her home country. In Germany, the Federal Statistical Office (StBA) collects this information and assists vendors in completing the relevant StBA forms. The supply of services is not included inIntrastat.

Goods that are imported into Germany from outside the European Community and the EU customs union must first go through customs procedures and be liable for any applicable customs at their point of entry.

Preferential Trade Agreements

Over the years, the countries of the European Union, including Germany, have signed a large number of preferential trade agreements. As a result, imports from these countries enjoy advantages related to reduced customs formalities and costs for entering the European (and German) markets.

Regions and countries benefiting from preferential agreements with the European Community include:

  • The European Free Trade Area and European Economic Area (Iceland, Norway, Liechtenstein, Switzerland)
  • Three non-EU Countries in the EC Customs Union (Andorra, San Marino, Turkey)
  • ACP countries (48 African, 16 Caribbean and 15 Pacific countries)
  • 20 Overseas Countries and Territories (OCT)
  • Countries  of the Pan-Euro-Mediterranean cumulation (EU, EFTA, Turkey, Faroe Islands and 9 other Mediterranean countries)
  • 27 least developed countries of the Generalized System of Preferences
  • Western Balkan states (Albania, Bosnia and Herzegovina, Macedonia and Serbia and Montenegro)
  • South Africa
  • Mexico and Chile
  • Faroe Islands, Ceuta and Melilla

A complete list of all preferential agreements of the EU with other countries is available on the Trade website of the European Commission. Furthermore, in order to take advantage of preferential trade status, preferential origin for imports from outside the EU must be properly documented for customs purposes. More information on the supporting documents for a customs declaration is available for download.

The Common Customs Tariff

The Common Customs Tariff governs trade between the member states of the EU and other countries. It contains the information on all applicable trade laws as well as both the shared classification of goods (combined nomenclature) and the duties which apply to them in each individual EU country. The online customs tariff database, TARIC, provides all the information included in the Common Customs Tariff for those involved in customs activities.

Customs duties in the EU are calculated ad-valorem, meaning: derived from the value of the imported goods. This customs value is equivalent to the sales price (cif-price), evidenced by a COMMERCIAL INVOICE, and adjusted by adding the costs of transport, insurance and loading in case they are not included in the sales price. A checklist of all the information required in a commercial invoice by German law is available for download.

The EU's TARIC database includes TARIC codes for specific goods as well as information on the applicable customs duties, restrictions and procedures for importing products into the EU and, consequently, into Germany. The ten-digit TARIC codes, which are valid for customs declarations in Germany, are an extension of the 6-digit harmonized codes developed by the World Customs Organization (WCO) and the 8-digit combined nomenclature system.

Customs Procedures

Depending on the reason goods are imported, different customs clearance procedures apply. Goods may be imported to be sold, repaired, temporarily stored or used in the production of other products for re-exportation.

Customs Procedures include: release for free circulation, inward processing, outward processing, customs warehousing, transit, temporary importation, processing under customs surveillance and end-use.

Procedure Description (German name)
Release for Free Circulation  The most commonly used customs clearance procedure: the imported goods, which are meant to be used/sold in Germany, are subject to the applicable customs duties and taxes. The importer pays the duties and is free to dispose of the goods. (Überführung in den freien Verkehr)
Customs Warehousing  Imported goods are exempted from customs duties within the EU, whenever they are temporarily stored in bonded warehouses in the EU customs area waiting to be re-exported. (Zolllagerverfahren)
Inward Processing  This procedure applies when imported goods are intended to be used in the production of other products within the EU which are then exported outside the EU. Any customs duties paid on the pre-product(s) are then reimbursed. (Aktive Veredelung)
Outward Processing  If community goods are exported temporarily for processing, repairing, or working abroad, the newly created and re-imported goods are subject to import duties. These duties are based on the value added outside the EU customs territory. (Passive Veredelung)
Processing under Customs Surveillance  This procedure applies when imported goods are intended to be used in the production of other products within the EU which are then released for free circulation. In this case, only the final products are liable for customs duties. (Umwandlungsverfahren)
Transit  A transit procedure, with the appropriate supporting documentation, facilitates the customs-free transfer of imported goods to an interior customs post for customs processing. (Versandverfahren)
Temporary Importation Items that are only temporarily brought into the European Union and are intended to be re-exported without modification, e.g. exhibits for trade fairs, can be partially or even fully exempted from customs duties. (vorübergehende Verwendung)
Generally, a deposit equal to the import duties is required for customs processing. Deposits are then refunded upon re-exporting. In place of this deposit, however, various internationally recognized Carnets (ATA, CPD or TIR) can be presented for both transit and temporary importation purposes.

Customs Declaration

Goods that are imported into Germany from outside the European Community and the EU customs union must first go through customs procedures and be liable for any applicable duties at their point of entry. Imported goods must be accompanied by a customs declaration submitted in writing as well as an invoice in duplicate. In order to clear customs in Germany, all declarations must be filed electronically by the German importer and/or an Authorized Economic Operator (AEO) using the German Customs Administration's ATLAS System.

Acquiring the title of an 'Authorized Economic Operator' can be of great value to companies either based in or with a subsidiary in the European Union that perform a large quantity of customs transactions. After successfully completing the application process, AEOs are entitled to simplified customs processing. The three types of certifications include AEO-Customs, AEO-Security and AEO-Full (for simplified customs and security procedures). Additionally, this status never expires and is valid in all 27 member states.

In order to complete customs procedures, the importer and/or AEO will need to know at least the following information:

  • the importer's customs or EORI number as applicable
  • the tariff code for the imported goods
  • the value of the goods as evidenced by a commercial invoice

The CUSTOMS NUMBER is required for businesses which perform customs procedures only in Germany.

The EORI NUMBER is required for businesses and individuals who

  • file customs, entry summary, or exit summary declarations anywhere in the EU
  • and are based either in Germany or outside the European Union
  • as well as all those who apply for AEO status.

This number applies to customs activities within the European Union as well as import licensing procedures in Germany. The EORI number is usually the same as the customs number with the prefix 'DE.'

Whenever companies perform customs procedures in several different EU countries they have the possibility of simplifying their administrative procedures by obtaining a single authorization. Under single authorization, businesses only file their customs declarations for activities in the European Community with a single customs administration. This customs authority is the one responsible for either the country where the company is based or the country where temporarily imported goods first enter the EU.

Both customs and EORI numbers as well as the AEO status and the single authorization can be applied for free of charge by filing the appropriate form(s) with the German Customs Administration.

ATLAS System for Electronic Customs Clearance

In order to clear customs in Germany, all declarations must be filed electronically using the German Customs Administration's ATLAS System (Automatic Rate and Local Customs Clearance System). ATLAS simplifies customs procedures and makes it easier to check the entered information before submission and to forward it on to all the parties involved. Companies may choose to submit electronic declarations either by utilizing a customs agent, the custom administration's internet customs declaration service, online customs software or certified ATLAS software available on the market.

If you choose to use either an online or an installed ATLAS software, make sure it is certified by the German Customs Administration. For this purpose, you will need the following documents:

  • a valid tax identification number,
  • a valid customs number from the German Customs Administration,
  • a completed registration form for the appropriate ATLAS-Release,
  • a completed network connection application form and
  • a completed application for a BIN (Beteiligten-Identifikations-Nummer) in lieu of a handwritten signature.

The last three items will need to be mailed to:

Bundesfinanzdirektion Südost, -Dienstort Weiden-, Postfach 1658, 92606 Weiden

For further information about the ATLAS system in Germany or the necessary declaration forms and registration procedures, please contact the German Customs Administration's Information Desk.

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