Closed consultation

Customs treatment of post and parcel exports – Export Memorandum of Understanding and Extra Territorial Offices of Exchange

Published 27 April 2023

Summary

Subject of this consultation

This consultation seeks views on the customs treatment of low-value post and parcel exports. In particular, this consultation focusses on the Export Memorandum of Understanding (Export MoU), available to authorised express operators, and on Extra Territorial Offices of Exchange (ETOEs), a common business operation of foreign designated postal operators.

Scope of this consultation

HMRC is consulting on:

• the customs treatment of operators moving goods via the Export MoU, including the Transhipment MoU
• the customs treatment of ETOEs

Who should read this

Express operators who are authorised to use the Export MoU; designated postal operators who operate ETOEs in the UK; and express operators who operate ETOEs in the UK. GB businesses that export low-value goods may also wish to read this consultation to better understand the post and parcel export industry.

Duration

This consultation will run for 12 weeks, from 27 April 2023 to 20 July 2023.

How to respond or enquire about this consultation

Any responses or queries about this consultation should be sent to postandparcelexports@hmrc.gov.uk or by post to:

HM Revenue and Customs
Post and Parcels Declarations Team
100 Parliament Street
London
SW1A 2BQ

HMRC will be holding webinars regarding this consultation where policy officials will explain the consultation questions and how to respond. If you would like to attend one of these webinars, please contact HMRC using the details above by 12 May 2023.

Foreword

On 15 March 2023, at Spring Budget, the Chancellor announced his intention to introduce a range of measures to simplify customs import and export processes. Central to this vision is a UK customs system that is at the cutting edge globally in terms of its openness, dynamism and capacity to advance the UK’s status as a leading hub for international trade in goods.

We want to continue to support and promote British exports and give businesses across the UK the chance to participate in the global economy. In November 2021, the Department for International Trade set out the government’s export strategy in ‘Made in the UK, Sold to the World’. This strategy set out the government’s desire to make exporting easier by making our borders and trade processes work smoothly and ensuring our approach to regulation supports trade.

Through this consultation, we are specifically looking at ways to support low-value e-commerce exports. The UK has a booming network of postal and express operators who underpin the e-commerce industry. These international couriers execute the smooth and efficient export of post and parcels to worldwide destinations.

Currently, the government offers two easements for low-value post and parcel exports: the Export Memorandum of Understanding, and the ability for foreign designated postal operators to establish ETOEs. These facilitations minimise the amount of customs information exporters need to provide, streamlining the process and attracting hundreds of millions of e-commerce exports a year.

We want to make these processes simpler and easier for express operators, ETOEs and UK exporters to support the UK’s competitiveness in the global market and promote economic growth. To do this, our central aim is to ensure the facilitations we provide to exporters of low-value post and parcels are as beneficial as possible. Further to this, we need to ensure these processes help support international efforts to apply appropriate control to the movement of dangerous and controlled goods, protecting the UK’s security, prosperity and global reputation.

I look forward to receiving a wide range of responses to this open process of review, so that we can draw on the very best ideas and ensure we mould a customs system for low-value exports that underpins the government’s ambition to make the UK the best place in the world to do business.

Victoria Atkins MP
Financial Secretary to the Treasury

1. Executive summary

This consultation seeks to understand who makes use of the Export MoU and ETOEs and why, before looking at each facilitation to establish ways in which the UK’s post and parcels export regime could be improved.

The objective is for HMRC to establish how the customs treatment of low-value post and parcel exports can be developed to ensure these processes are more facilitative for operators, creating a level playing field for postal and parcel operators to export low-value goods with ease. HMRC is seeking to balance this objective with the need to ensure appropriate due diligence is applied to all exported goods, helping protect the countries and territories we export to while complying with our international obligations.

This consultation initially seeks to understand the types of businesses using these two export facilitations. In Chapter 3 we are interested in understanding why the use of the Export MoU or ETOEs is important to your business and what you use these facilitations for.

The consultation then tests new proposals for the UK’s post and parcels export regime. Chapter 4 asks specific questions on the Export MoU and how HMRC can improve the facilitations it provides. HMRC wants to ensure the Export MoU continues to work in a way that provides operators with a simple and easy-to-use route to export low-value goods. HMRC will use these answers to help inform future policy and legislation regarding the facilitations available for low-value parcel exports, ensuring they are fit for purpose and clear for all users. This section also asks questions on the Transhipment MoU, an additional limb of the Export MoU that allows authorised operators to tranship qualifying items through the UK.

Chapter 5 has specific questions for those who are involved in the operation of ETOEs in the UK. These questions test new proposals to improve ETOEs’ experience of interacting with the UK’s customs system while exploring how HMRC can ensure better due diligence to protect the countries and territories we export to. This will make it simpler and easier for businesses to understand how to export their goods to overseas markets and ensure a level playing field for export operators.

The responses to this consultation will be used to inform future policy in these areas. HMRC will publish a summary of responses within 12 weeks of the consultation ending.

2. Introduction

To ensure e-commerce exports continue to move smoothly through our borders and to customers and markets around the world, HMRC’s primary aim is to ensure the easements available are simple and easy to follow for both UK exporters and their carriers. HMRC is committed to making the process for low-value exports more facilitative while supporting the UK’s position as a responsible and trustworthy trading partner. To this end, we must also ensure the processes are robust and secure.

Currently, the government offers two easements to carriers that makes it easier to export low-value parcels. These are:

• the Export MoU
• via ETOEs

This consultation seeks to understand who takes advantage of these easements and why they do so, before investigating ways in which they could be improved.

The Export MoU

The Export MoU, established in 2003, allows qualifying individual consignments under the value of £900 to be bulk declared by authorised express operators using Entry in the Declarant’s Records (EIDR) ^{[footnote 1]}. A C21 customs clearance record is required by HMRC before the goods exit the UK and a supplementary declaration must be submitted within 14 days of export (providing the number of items and total bulk value). The Export MoU is open to members of the express industry who meet its criteria.

The Export MoU is a vital component of the UK’s exporting framework for e-commerce movements. HMRC wants to ensure the facilitations it provides remain fit for purpose and continue to support the UK’s position as a hugely popular market from which to purchase e-commerce goods.

Authorised Export MoU traders can also apply for the Transhipment MoU. This allows authorised operators to tranship international-originating bulk consignments under £5,000 through the UK with simplified customs information.

ETOEs

As set out in Article 13 of the Universal Postal Union (UPU) Convention, ETOEs are facilities established for commercial purposes and operated by, or in connection with, a designated postal operator in a territory other than their own, with the objective of drawing business in markets outside their respective national territory ^{[footnote 2]}. HMRC understands ETOEs play a significant role in the facilitation of UK e-commerce exports, moving tens of millions of items a year.

The UPU allows member countries to determine if and how ETOEs can operate in their territory. Designated postal operators may freely establish ETOEs in the UK. ETOEs in the UK use UPU CN 22 and CN 23 forms to export parcels. CN 22 and CN 23 customs forms require a low level of detail and can also be used as import forms dependant on the policies of the receiving country.

ETOEs have expanded significantly in the UK since the beginning of the 21st century to become an important option for those looking to send low-value goods abroad. In the run up to the End of Staged Customs Controls on 01 January 2022, HMRC engaged with ETOEs established in the UK to ensure they understood how to move postal items through the Goods Vehicle Movement Service (GVMS) on UPU customs forms. This engagement round involved several conversations on the structure and operations of ETOEs which have informed these consultation questions.

Summary

While the questions in Chapter 3 should be answered by all respondents, not all questions in Chapters 4 and 5 may be relevant to you. However, we encourage you to read all chapters, so that we can gather suggestions on how to ensure these facilitations are supporting the government’s objectives.

3. About your business

Background

This forms the first of three sections to this consultation where we are seeking to understand who takes advantage of the Export MoU and ETOEs and why. The following questions are for background information only to contextualise the rest of your responses.

We understand some of this information may be commercially sensitive. Please see the ‘Confidentiality’ section for information on HMRC’s commitment to maintaining the privacy and security of the information you provide us.

Who are you?

Question 1: What is the name of your business and where are you based in the UK?

Question 2: What type of business are you (for example, Fast Parcel Operators, designated postal operator, haulier etc.)?

Question 3: What is the size of your business:

• micro (0-9 employees)
• small (9-49 employees)
• medium (50-249 employees)
• large (over 250 employees)?

Question 4: Do you use the Export MoU and/or operate an ETOE?

Question 5: When did you first begin to use the Export MoU, and/or operate your ETOE in the UK? If you operate an ETOE, is it currently active, or has it, at any point, been inactive? If so, please provide a reason why.

Question 6: If you operate an ETOE, please state which designated postal operator(s) you operate on behalf of.

What do you do?

Question 7: Roughly, how many individual consignments do you export through the Export MoU and/or your ETOE per year and what is the approximate total value of these goods?

Question 8: Please describe the type of goods you export, the type of customers you serve and the countries you export to via the Export MoU and/or your ETOE. For businesses serving a wide range of customers, we welcome general qualitative descriptions (such as fast fashion retailers and homeware to Central Asia) rather than a more detailed answer.

Question 9: If your business uses the Export MoU and operates an ETOE, please outline the reasons for offering both services and the main benefits of each. How do you pass these benefits on to your UK customers?

How do you operate?

Question 10: How do you export items from the UK – by road, sea or air? If you use a mix of transport options, please provide a rough estimate of the share each option occupies (foe example, 35% air, 65% road).

Question 11: If you operate an ETOE, do you have a separate Economic Operators Registration and Identification number (EORI) to cover this section of your business? If so, please explain how this works.

4. Export Memorandum of Understanding

Background

The Export MoU was introduced to offer a bulk export procedure with a high degree of certainty and predictability for express operators exporting low-value parcels. It is mostly used by Fast Parcel Operators (FPOs).

The Export MoU significantly reduces the customs clearance process by automatically clearing a large proportion of parcels an express operator is looking to export while ensuring an appropriate level of compliance is met.

For an export to qualify, the individual consignment must have a value below £900, be in free circulation, and not contain goods that are controlled or subject to prohibitions, restrictions or subject to other customs procedures (such as temporary admission, inward processing or customs warehousing and outward processing).

Express operators using this facilitation must be approved by HMRC. Approval to use this facilitation comes with obligations and while each MoU may vary depending on the commercial activities of the particular operator, it is expected that the following will apply:

• HMRC will have access to track and trace systems (where these exist), the operator’s systems, and manifests when requested

• operators will be required to assist HMRC by carrying out direct specific checks on a case-by-case basis

• the operator will have internal controls and procedures in place prior to being approved. These must be up to Authorised Economic Operator (AEO) C standards, but the operator does not need to be an AEO

In addition to this, express operators authorised to use the Export MoU have certain requirements they must follow, including:

• entering details of their export consignments into their own records before export (EIDR)

• submitting a Notice of Presentation in the form of a C21 customs clearance document to clear goods out of the country

• routing goods through an authorised Export MoU facility before export to carry out the relevant tests and checks required by authorisation

• performing pre- and post-shipment tests and notifying HMRC of suspicious goods identified in pre-shipment tests for a decision prior to exportation

• submitting a supplementary declaration within 14 days of the export of the goods

These requirements placed on authorised express operators allow for a significantly reduced customs procedure that enables the quick flow of goods out of the UK while ensuring an appropriate level of compliance is met.

Authorised Export MoU traders can also apply to use the Transhipment MoU. Section 4.4 asks further questions for traders who make use of this facilitation.

Improving flow

The Export MoU is the cornerstone of the UK’s e-commerce export customs facilitations. With an estimated 170 million items exported under the Export MoU in 2021, HMRC wants to ensure the facilitations it provides are simple and easy to use to help maintain the UK’s position as a global leader in e-commerce.

The following questions test proposals to improve the facilitations provided by the Export MoU to enable greater trade flows.

Proposal

Increase the value cap on individual consignments that can be moved via the Export MoU from £900.

Question 12: Any change to this threshold will be based on extensive analysis and we are keen to understand your views on this. Please share your views and what you think would be an appropriate threshold (please provide data where possible, such as how many more consignments you could export a year, or the % increase in eligible goods if the threshold was raised to a particular amount).

To meet the conditions of the Export MoU, HMRC currently requires goods moving under the Export MoU to be routed through an approved Export MoU operator’s facility. This provides HMRC with confidence that the conditions of the Export MoU, and therefore the required level of due diligence and compliance, are met for these exports.

HMRC understands this process can increase the time it takes for goods to leave the UK. We are keen to understand whether this condition could be altered to improve flow while maintaining the required level of due diligence.

Proposal

Allow goods to be exported directly from the site of a sending business by an authorised operator and not be routed via the authorised operator’s facility.

Question 13: Please share your views on this (particularly on how you would ensure the necessary checks and record keeping would be undertaken and the effects this would have on your business and your use of the facilitation).

Question 14: Are there further ways you think HMRC could improve the facilitations it provides to low-value parcel exports?

Improving Due Diligence

As set out earlier, HMRC needs to ensure appropriate due diligence is undertaken on exports to protect the countries and territories we export to.

Currently, HMRC makes operators aware of specific goods or destination countries we want them to refer goods for. One alteration to improve this current system could be for operators to provide data to HMRC pre-export, providing HMRC with the opportunity to carry out risking tests and inspect suspicious items before the items leave the UK.

Proposal

For authorised operators to submit basic item level data (such as consignor name, address and EORI, consignee name, address and EORI, value, goods description, weight) to HMRC before the items leave the UK.

Question 15: Please share your views on this.

Question 16: How easy is it for you to understand your obligations as an Export MoU operator? Are there areas where you think guidance could be improved?

Question 17: Are there any further suggestions you have for how due diligence could be improved on low-value parcel exports?

Transhipment MoU

Authorised Export MoU traders can also apply for the Transhipment MoU facilitation. This enables authorised express operators to move international-originating bulk consignments inland to their designated premises to de-consolidate the bulk consignment into individual consignments for dispatch to the ultimate country of destination. This can currently be used where the individual consignment value is under £5,000 and the goods are not controlled or subject to prohibitions or restrictions.

Whilst one Transhipment MoU operator may bring the consignment in, it can also be passed to another approved transhipment operator to re-export, although a C21 customs clearance request is required on export. The authorised express operator has four days to export the goods from the UK from the date of import.

Just like the Export MoU, the Transhipment MoU carries certain obligations for authorised express operators. These include:

• the need to provide a clear audit trail within commercial systems that demonstrates reconciliation and accountability for all inbound and outbound consignments at item level

• providing site access to Border Force and HMRC staff to inspect goods when required

• ensuring items deposited in the approved premises under the Transhipment MoU are declared and exported within four days

The following questions concern the use of the Transhipment MoU:

Question 18: How many individual consignments do you move through the Transhipment MoU a year?

Question 19: What processes do you put in place to supervise the goods during de-consolidation?

Question 20: Are there any suggestions you have for how the Transhipment MoU could be improved?

HMRC must ensure that facilitations that require simplified customs information are available to appropriate movements. In 2019, HMRC analysis found that the majority of consignments moved under the Transhipment MoU were under £1,000, and we would like to understand if this remains the case.

Question 21: What proportion of the consignments you move under the Transhipment MoU are under the value of £1,000?

The government offers various procedures for goods to transit through the UK, providing streamlined customs arrangements to help support the flow of goods, minimising the cost of administration and reducing delays at the border. Following the UK’s exit from the EU, we successfully negotiated independent membership to the Common Transit Convention (CTC) to offer traders and industry another customs facilitation to move goods into and out of the EU and other CTC members. It allows the movement of goods under duty suspense between contracting parties.

HMRC is keen to ensure its authorisations are streamlined and not duplicated. Given our membership of the CTC, other transit facilitations are available that fulfil similar purposes to the Transhipment MoU.

Question 22: What benefits does the Transhipment MoU offer in relation to other transit facilitations? What would be the impact on your business if the Transhipment MoU was removed as a facilitation?

5. Extra Territorial Offices of Exchange

Background

Following the UK’s exit from the EU and the changes required to the UK’s border and customs processes, the government wants to ensure UK policy towards ETOEs is clear and comprehensive, providing long-term direction for the sector. HMRC wants to ensure the sector retains access to a competitive facilitation that makes it easier for UK businesses to export.

Alongside this, HMRC must ensure it can effectively implement and operate controls on exports, including implementing sanctions and ensuring the UK is complying with international obligations regarding exports (such as the Convention on International Trade in Endangered Species of Wild Fauna and Flora, and the Montreal Protocol).

As set out in Chapter 4, a clear advantage of the Export MoU is that it achieves a balance of delivering a real benefit to the UK economy while protecting the UK’s security and international reputation. HMRC wants to test how applying a revised, more facilitative structure to ETOEs could work.

Current UPU and UK framework for ETOEs

The global postal network is governed by the UPU, which ensures cooperation between international postal sector players and sets the standards for international mail exchanges between nationally designated operators. The UPU sets out that postal operators can make use of CN 22 and CN 23 customs forms to move goods across borders and inject the goods into another postal operator’s network.

ETOEs in the UK currently export items in free circulation that are not subject to prohibitions or restrictions on UPU CN 22 and CN 23 customs forms and, since 01 January 2005, they have been forbidden from importing items on these forms (UPU Circular 372/2004).

As per UPU guidance, CN 22 forms can be used for goods up to the value of 300 SDR and CN 23 forms can be used for goods over this value ^{[footnote 3]}. The value of goods that can be exported from the UK on CN 23 forms alone is limited to goods under the value of £1,000 as per The Customs (Exports) (EU Exit) Regulations 2019 ^{[footnote 4]}. For such qualifying goods no declaration is submitted into HMRC systems, such as CHIEF or CDS.

Proposal

Increase the value cap on individual consignments that can be exported on CN 23 customs forms from £1,000.

Question 23: Any change to this threshold will be based on extensive analysis and we are keen to understand your views on this. Please share your views and what you think would be an appropriate threshold (please provide data where possible, such as how many more consignments you could export a year, or the percentage increase in eligible goods if the threshold was raised to a particular amount).

Currently, to establish an ETOE in the UK, designated postal operators are required to notify The Department for Business and Trade of their intention to contact the UPU and request a new International Mail Processing Centre (IMPC) code. The Department for Business and Trade does not authorise these requests, but it provides acknowledgement of them and sets out UK policy on the operation of ETOEs.

UPU CN 22 and CN 23 forms offer significant benefits in ensuring the rapid flow of postal items around the globe. However, HMRC has a responsibility to balance this flow with an obligation to ensure appropriate due diligence is undertaken on the contents of the goods moved and their ultimate destination.

Access to UPU customs forms

As per Article 13 of the UPU Convention, individual member states can determine whether ETOEs may use UPU customs forms to facilitate the operation of postal services and it is therefore the responsibility of the UK government to determine whether it is appropriate that ETOEs use these forms.

In order for ETOEs and HMRC to work together effectively, HMRC is considering proposals to introduce specific requirements to allow ETOEs to benefit from the continued use of UPU CN 22 and CN 23 forms for exports.

These proposals would see ETOEs required to follow a set of standards similar to those using the Export MoU, creating a level playing field for post and parcel operators to export low-value goods. The following questions in this chapter look to test proposals for the UK’s postal exports regime.

Declarations

The Export MoU requires the declarant to hold information pertaining to exports in their records. The declarant must then provide a C21 customs clearance request into CHIEF/CDS for each country of destination they export to and submit a supplementary declaration with the total number of consignments and total volume and total value of all consignments in the bulked export.

Question 24: What information do you currently collect and store on items you export via your ETOE? (such as consignor name and address, consignee name and address, value, goods description, weight).

We are keen to understand whether ETOEs could operate under a similar regime to those using the Export MoU, and if not why not. This would provide greater visibility to HMRC and would still provide ETOEs with a highly facilitative regime to export low value goods.

Proposal

For ETOEs to declare their exports by entering their details into their own records (EIDR), as express operators using the Export MoU do, provide the required Notice of Presentation in the form of a C21 customs clearance request and submit a supplementary declaration within 14 days of making this entry.

Question 25: Please share your views on this proposal.

Improving due diligence

We must ensure no goods subject to prohibitions or restrictions, including goods subject to sanctions or Strategic Export Controls, are exported via the postal system. Export controls are integral to protecting the UK’s security, prosperity and global reputation.

Question 26: What risking activities do you undertake to ensure you do not export goods subject to a prohibition or restriction (such as sanctioned goods or goods subject to the UK’s strategic export control regime) via your ETOE, and that the CN 22 and CN 23 forms on the parcels you are exporting are accurate and truthful? What actions do you take if you identify a good subject to a prohibition or restriction?

HMRC is investigating two potential proposals to mitigate this risk. Please give your thoughts on these below.

One way this could be achieved is through ETOEs carrying out routine checks on their export consignments and referring suspicious items to HMRC, as per the terms of the Export MoU. Once an item is referred to HMRC, the ETOE would be required to hold that item until further instructions are received (HMRC will aim to provide these within 48 hours).

Suspicious items include goods subject to prohibitions and restrictions and goods that are suspected to be undervalued or misdescribed.

Proposal

For ETOEs to carry out routine checks on their export consignments and refer suspicious items to HMRC.

Question 27: Please share your views on this, particularly on how you would implement such a system if you do not already have one in place.

Another way this could be achieved is for ETOEs to provide data to HMRC pre-export, as per the proposal for the Export MoU in Chapter 4, providing HMRC with the opportunity to carry out risking tests and inspect suspicious items.

Proposal

For ETOEs to submit basic item level data (for example, consignor name, address and EORI, consignee name, address and EORI, value, goods description, weight) to HMRC before the items leave the UK, allowing the government to conduct risking tests and inspect suspicious items.

Question 28: Please share your views on this proposal.

Border Force

Border Force maintain an operational presence at large international courier sites, including at Royal Mail, FPO hubs and all international airports. Border Force help secure the UK border by carrying out customs checks on goods entering and leaving the UK.

HMRC understands Border Force have a relationship with some ETOEs. However, to support appropriate compliance, Border Force should have access to all customs intermediary sites in the UK that facilitate exports.

Question 29: If you already have a relationship with Border Force, please explain how this currently operates.

Summary

Question 30: HMRC usually allows a period of 6 to 12 months for businesses to implement systems changes; how would you work to implement these proposals within this timeframe?

Question 31: Are there any further suggestions that you have for how the customs treatment of ETOEs could be reformed?

6. Assessment of impacts

Summary of impacts

Exchequer Impact Assessment

Year	2022 to 2023	2023 to 2024	2024 to 2025	2025 to 2206	2026 to 2027	2027 to 2028
Exchequer impact (£m)	Nil	Nil	Nil	Nil	Nil	Nil

We do not expect this to have an impact on the Exchequer as this relates to exports, where HMRC collects no revenue.

Impacts	Comment
Economic impact	The economic impact will be identified following the consultation and final design of the policy.
Impact on individuals, households and families	Any changes to this policy are expected to have minimal impact on individuals, households and families.
Equalities impacts	This policy is not expected to cause a greater impact on any particular group or nation. It should be noted the Northern Ireland Protocol applies in Northern Ireland.
Impact on businesses and Civil Society Organisations	Any change would have an impact on express operators that use the Export MoU, FPOs that operate ETOEs and Designated Postal Operators that have ETOEs in the UK. Changes could also impact UK exporters of low-value post and parcels as any additional requirements for ETOEs or the Export MoU could push additional costs onto them. Similarly, any additional easements granted should reduce the cost of exporting low-value post and parcels.
Impact on HMRC or other public sector delivery organisations	Any additional delivery funding requirements will be assessed following the outcome of the consultation.
Other impacts	Any further impacts will be fully examined and detailed following the consultation.

7. Summary of consultation questions

Question 1: What is the name of your business and where are you based in the UK?

Question 2: What type of business are you (such as FPO, designated postal operator, haulier etc.)?

Question 3: What is the size of your business:

• micro (0-9 employees)
• small (9-49 employees)
• medium (50-249 employees)
• large (over 250 employees))?

Question 4: Do you use the Export MoU and/or operate an ETOE?

Question 5: When did you first begin to use the Export MoU, and/or operate your ETOE in the UK? If you operate an ETOE, is it currently active, or has it, at any point, been inactive? If so, please provide a reason why.

Question 6: If you operate an ETOE, please state which designated postal operator(s) you operate on behalf of.

Question 7: Roughly, how many individual consignments do you export through the Export MoU and/or your ETOE per year and what is the approximate total value of these goods?

Question 8: Please describe the type of goods you export, the type of customers you serve and the countries you export to via the Export MoU and/or your ETOE. For businesses serving a wide range of customers, we welcome general qualitative descriptions (such as fast fashion retailers and homeware to Central Asia) rather than a more detailed answer.

Question 9: If your business uses the Export MoU and operates an ETOE, please outline the reasons for offering both services and the main benefits of each. How do you pass these benefits on to your UK customers?

Question 10: How do you export items from the UK – by road, sea or air? If you use a mix of transport options, please provide a rough estimate of the share each option occupies (for example, 35% air, 65% road).

Question 11: If you operate an ETOE, do you have a separate EORI to cover this section of your business? If so, please explain how this works.

Proposal: Increase the value cap on individual consignments that can be moved via the Export MoU from £900.

Question 12: Any change to this threshold will be based on extensive analysis and we are keen to understand your views on this. Please share your views and what you think would be an appropriate threshold (please provide data where possible, such as how many more consignments you could export a year, or the % increase in eligible goods if the threshold was raised to a particular amount).

Proposal: Allow goods to be exported directly from the site of a sending business by an authorised operator and not be routed via the authorised operator’s facility.

Question 13: Please share your views on this (particularly on how you would ensure the necessary checks and record keeping would be undertaken and the effects this would have on your business and your use of the facilitation).

Question 14: Are there further ways you think HMRC could improve the facilitations it provides to low-value parcel exports?

Proposal: For authorised operators to submit basic item level data (such as consignor name, address and EORI, consignee name, address and EORI, value, goods description, weight) to HMRC before the items leave the UK.

Question 15: Please share your views on this proposal.

Question 16: How easy is it for you to understand your obligations as an Export MoU operator? Are there areas where you think guidance could be improved?

Question 17: Are there any further suggestions you have for how due diligence could be improved on low-value parcel exports?

Question 18: How many individual consignments do you move through the Transhipment MoU a year?

Question 19: What processes do you put in place to supervise the goods during de-consolidation?

Question 20: Are there any suggestions you have for how the Transhipment MoU could be improved?

Question 21: What proportion of the consignments you move under the Transhipment MoU are under the value of £1,000?

Question 22: What benefits does the Transhipment MoU offer in relation to other transit facilitations? What would be the impact on your business if the Transhipment MoU was removed as a facilitation?

Proposal: Increase the value cap on individual consignments that can be exported on CN 23 customs forms from £1,000.

Question 23: Any change to this threshold will be based on extensive analysis and we are keen to understand your views on this. Please share your views and what you think would be an appropriate threshold (please provide data where possible, e.g. how many more consignments you could export a year, or the % increase in eligible goods if the threshold was raised to a particular amount).

Question 24: What information do you currently collect and store on items you export via your ETOE? (such as consignor name and address, consignee name and address, value, goods description, weight).

Proposal: For ETOEs to declare their exports by entering their details into their own records (Entry in the Declarant’s Records, EIDR), as express operators using the Export MoU do, provide the required Notice of Presentation in the form of a C21 customs clearance request and submit a supplementary declaration within 14 days of making this entry.

Question 25: Please share your views on this proposal.

Question 26: What risking activities do you undertake to ensure you do not export goods subject to a prohibition or restriction (such as sanctioned goods or goods subject to the UK’s strategic export control regime) via your ETOE, and that the CN 22 and CN 23 forms on the parcels you are exporting are accurate and truthful? What actions do you take if you identify a good subject to a prohibition or restriction?

Proposal: For ETOEs to carry out routine checks on their export consignments and refer suspicious items to HMRC.

Question 27: Please share your views on this proposal, particularly on how you would implement such a system if you do not already have one in place.

Proposal: For ETOEs to submit basic item level data (for example, consignor name, address and EORI, consignee name, address and EORI, value, goods description, weight) to HMRC before the items leave the UK, allowing HMG to conduct risking tests and inspect suspicious items.

Question 28: Please share your views on this proposal.

Question 29: If you already have a relationship with Border Force, please explain how this currently operates.

Question 30: HMRC usually allows a period of 6 to 12 months for businesses to implement systems changes; how would you work to implement these proposals within this timeframe?

Question 31: Are there any further suggestions that you have for how the customs treatment of ETOEs could be reformed?

8. Glossary of Terms

Term	Description
Authorised Economic Operator (AEO)	AEO status is a certified standard authorisation issued by customs administrations to businesses that are part of the international supply chain. This starts from the manufacturing process through to the delivery of goods using import and export procedures. You can find further information, including how to apply for AEO status, on GOV.UK.
Customs Declaration Service (CDS)	The CDS supports making import and export declarations when moving goods into and out of the UK. CDS replaced CHIEF for imports on 01 October 2022 and will fully replace CHIEF for exports from 1 December 2023.
Customs Handling of Import Export Freight (CHIEF)	The CHIEF system records the movement of exported goods by land, air and sea. CHIEF is being replaced by CDS in stages.
CN 22 and CN 23 forms	CN 22 and CN 23 are special declaration customs forms for postal items as described in the Acts of the Universal Postal Union.
Controlled goods	Specific goods subject to additional customs controls. The government maintains a public list of controlled goods.
Common Transit Convention (CTC)	The CTC is used for moving goods between the EU member states, the European Free Trade Association (EFTA) countries (Iceland, Norway, Liechtenstein and Switzerland) as well as the UK, Turkey, Republic of North Macedonia and Serbia. The UK is a member of the CTC, ensuring simplified cross-border trade for UK businesses exporting their goods.
Customs intermediary	Customs intermediaries help traders to move goods across borders. Most traders hire a person or business to deal with customs on their behalf. Examples of intermediaries include freight forwarders, customs agents, brokers or fast parcel operators.
C21	A Customs Clearance Request or C21 form is required by traders in order to request the release of goods at a location with an inventory system.
Designated Postal Operator	Designated Postal Operators are national postal operators tasked by their governments to fulfil the government’s obligations under the treaties of the Universal Postal Union.
Entry in the Declarant’s Records (EIDR)	EIDR permits the details of an export consignment to be entered into the declarant’s records before export, without a pre-departure notification at the time of export. A ‘notice of presentation’ must be provided using a C21 form, and a supplementary declaration is required.
Economic Operators Registration and Identification (EORI) number	An EORI number is required for all businesses moving goods into or out of the UK. You can find further information, including a how to apply for an EORI number on GOV.UK.
Fast Parcel Operators (FPOs)	FPOs are couriers who specialise in moving parcels at speed. They often complete import and export declarations on behalf of consumers and businesses.
Goods Vehicle Movement Service (GVMS)	GVMS is a UK government IT platform for moving goods into or out of Northern Ireland and Great Britain (England, Scotland and Wales).
International Mail Processing Centres (IMPCs)	IMPCs are mail processing facilities that have significance for the processing of inter-operator mail, either because they generate or receive despatches or because they act as transit centres for mail exchange between other IMPCs. Each IMPC has a well-defined physical location, is operated by or under the responsibility of a single organisation and handles a specific set of mail flows.
Staged Customs Controls	At the end of the Transition Period, the government announced that it would implement Staged Customs Controls for EU imports. Under this approach, known as transitional EIDR, traders importing non-controlled goods from the EU could enter the information on the goods into their own records and then submit a supplementary declaration within 175 days of arrival. Staged Customs Controls ended on 01 January 2022.
Special Drawing Right (SDR)	The SDR is a monetary unit used between Posts. SDRs are denoted with the currency code XDR.
Transit	See ‘Common Transit Convention’.
Universal Postal Union (UPU)	The UPU is the specialised agency of the United Nations that regulates the universal postal service. The postal services of its 192 member countries form the largest physical distribution network in the world.

9. The consultation process

This consultation is being conducted in line with the Tax Consultation Framework. There are 5 stages to tax policy development:

Stage 1: Setting out objectives and identifying options.

Stage 2: Determining the best option and developing a framework for implementation including detailed policy design.

Stage 3: Drafting legislation to effect the proposed change.

Stage 4: Implementing and monitoring the change.

Stage 5: Reviewing and evaluating the change.

This consultation is taking place during stage 1 of the process. The purpose of the consultation is to seek views on the policy design and any suitable possible alternatives.

How to respond

A summary of the questions in this consultation is included at chapter 6.

Responses should be sent by 20 July 2023, by email to postandparcelexports@hmrc.gov.uk or by post to:

HM Revenue and Customs
Post and Parcels Declarations Team
100 Parliament Street
London
SW1A 2BQ

HMRC will be holding webinars regarding this consultation where policy officials will explain the consultation questions and how to respond. If you would like to attend one of these webinars, please contact HMRC using the details above by 12 May 2023.

Please do not send consultation responses to the Consultation Coordinator.

Paper copies of this document or copies in Welsh and alternative formats (large print, audio and Braille) may be obtained free of charge from the above address.

All responses will be acknowledged, but it will not be possible to give substantive replies to individual representations.

When responding please say if you are a business, individual or representative body. In the case of representative bodies please provide information on the number and nature of people you represent.

Confidentiality

HMRC is committed to protecting the privacy and security of your personal information. This privacy notice describes how we collect and use personal information about you in accordance with data protection law, including the UK GDPR and the Data Protection Act (DPA) 2018.

Information provided in response to this consultation, including personal information, may be published or disclosed in accordance with the access to information regimes. These are primarily the Freedom of Information Act 2000 (FOIA), the DPA 2018, UK GDPR and the Environmental Information Regulations 2004.

If you want the information that you provide to be treated as confidential, please be aware that, under the Freedom of Information Act 2000, there is a statutory Code of Practice with which public authorities must comply and which deals with, amongst other things, obligations of confidence. In view of this it would be helpful if you could explain to us why you regard the information you have provided as confidential. If we receive a request for disclosure of the information we will take full account of your explanation, but we cannot give an assurance that confidentiality can be maintained in all circumstances. An automatic confidentiality disclaimer generated by your IT system will not, of itself, be regarded as binding on HM Revenue and Customs.

Consultation Privacy Notice

This notice sets out how we will use your personal data, and your rights. It is made under Articles 13 and/or 14 of the UK GDPR.

Your data

We will process the following personal data:

Name
Email address
Postal address
Phone number
Job title

Purpose

The purposes for which we are processing your personal data is: The Customs Treatment of Post and Parcel Exports: the Export Memorandum of Understanding and Extra Territorial Offices of Exchange.

Legal basis of processing

The legal basis for processing your personal data is that the processing is necessary for the exercise of a function of a government department.

Recipients

Your personal data will be shared by us with HM Treasury.

Retention

Your personal data will be kept by us for 6 years and will then be deleted.

Your rights

You have the right to request information about how your personal data are processed, and to request a copy of that personal data.

You have the right to request that any inaccuracies in your personal data are rectified without delay.

You have the right to request that any incomplete personal data are completed, including by means of a supplementary statement.

You have the right to request that your personal data are erased if there is no longer a justification for them to be processed.

You have the right in certain circumstances (for example, where accuracy is contested) to request that the processing of your personal data is restricted.

Complaints

If you consider that your personal data has been misused or mishandled, you may make a complaint to the Information Commissioner, who is an independent regulator. The Information Commissioner can be contacted at:

Information Commissioner's Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

0303 123 1113 casework@ico.org.uk

Any complaint to the Information Commissioner is without prejudice to your right to seek redress through the courts.

Contact details

The data controller for your personal data is HMRC. The contact details for the data controller are:

HMRC
100 Parliament Street
Westminster
London
SW1A 2BQ

The contact details for HMRC’s Data Protection Officer are:

The Data Protection Officer
HMRC
14 Westfield Avenue
Stratford
London
E20 1HZ

advice.dpa@hmrc.gov.uk

Consultation principles

This call for evidence is being run in accordance with the government’s Consultation Principles.

The Consultation Principles are available on the Cabinet Office website.

If you have any comments or complaints about the consultation process, please contact the Consultation Coordinator.

Please do not send responses to the consultation to this link.

1. Bulking is a customs simplification that allows certain traders to declare multiple low-value consignments in a single customs declaration using a significantly reduced data set compared to a full customs declaration; EIDR permits the details of an export consignment to be entered into the declarant’s records before export, without a pre-departure notification at the time of export. ↩

2. Designated Postal Operators are national postal operators tasked by their government to fulfil the government’s obligations under the UPU treaties. ↩

3. The SDR (special drawing rights) is a monetary unit used between Posts. SDRs are denoted with the currency code XDR. ↩

4. Regulation 23(1) of the Customs (Export) (EU Exit) Regulations 2019. Note, an increase from £900 to £1,000 was made by the Taxation (Cross-Border Trade) (Miscellaneous Amendments) (EU Exit) Regulations 2021 (S.I. 2021/697), regs. 1, 3(2). ↩