Consultation outcome

Introducing a voluntary standard for customs intermediaries - summary of responses

Updated 7 December 2023

Introduction

The 2025 UK Border Strategy sets out the government’s vision for the UK border to be the most effective in the world. A border which simplifies processes for traders, improves the security and biosecurity of the UK, and embraces innovation. As part of this, the government is committed to working with customs intermediaries to help them deliver high-quality services for traders.

Customs intermediaries help traders to move goods across borders by ensuring they are meeting their obligations and moving goods efficiently through the customs system and are therefore a key component in the operation of the border and the facilitation of trade. They normally complete customs declarations on behalf of traders, sometimes alongside other services, like paying tariffs or import duties and providing or arranging transportation of goods. A range of businesses act as intermediaries, including customs brokers, agents or advisors, fast parcel operators (FPOs), freight forwarders, warehouse operators and hauliers.

The government recognises the critical role that customs intermediaries play in supporting traders and facilitating trade. For that reason, we included a chapter on the customs intermediary sector in our February 2022 Call for Evidence: An Independent Customs Regime (CfE), which sought views on the sector, including on the quality of service that traders receive.

Responses to the CfE emphasised the value and importance of customs intermediaries. However, feedback was mixed on the overall quality of service provided across the sector, with some responses detailing concerns over quality, as well as reports of good or satisfactory service. The government therefore considered policy responses to address the reported issues with quality and variations in the level of service provided. These included options such as relying on the market to provide solutions, and the option to introduce mandatory, regulatory requirements on intermediaries as exist in some other countries.

Being mindful of the need to strike a balance between a high-quality intermediary sector and the demands placed on intermediaries to achieve this, the government published the consultation ‘Introducing a voluntary standard for customs intermediaries’ in June 2023. This sought views on a voluntary approach which would encourage improvements in quality and standards in the sector and could provide a means for traders to distinguish between the quality of providers, while being less burdensome and disruptive than mandatory regulation of customs intermediaries.

The consultation asked for views on the objectives of such a voluntary standard, how it could be designed and implemented, high-level proposals for content, and the current training and education offerings available to the intermediary sector. A full list of consultation questions is available at Annex B.

Summary of responses

The consultation ran from 5 June 2023 to 30 August 2023. During this time, HMRC held 6 webinars and received 55 formal written responses from stakeholders, as detailed in Annex A.

Webinar attendees and written responses represented a wide range of stakeholders of different sizes from across the border industry, and beyond. Written responses were received from intermediaries of all sizes and of various types, in particular customs brokers, agents and freight forwarders. Traders who responded were large or medium sized businesses, from several different industries. Responses were also received from several representative bodies or trade associations representing diverse memberships, such as intermediaries, small businesses, tax professionals and the international trade community. A small number of responses were also received from organisations with a broad interest in standards, certification and/or accreditation.

The government is grateful to all those who took the time to provide their views in response to the consultation.

Overarching views

Respondents were supportive of the government’s intention to raise quality and standards in the customs intermediary sector. The majority were also supportive of the proposal to introduce a voluntary standard for customs intermediaries, citing the potential for the standard to set a benchmark, drive good practice and improve quality in the sector.

Cost to intermediaries of adhering to or being certified against the standard was commonly raised, with these respondents often noting the need to ensure that costs remained proportionate so as not to be prohibitive.

A small minority suggested that they would prefer a mandatory regime, either now or in the future, although most of these still endorsed introducing a voluntary standard.

A small number of tax stakeholders (including professional bodies), who also operate in the customs intermediary market, responded to the consultation. These stakeholders were largely in favour of introducing a voluntary standard for customs intermediaries, recognising the difference between customs intermediaries and tax agents. They noted that particular consideration should be given to how this standard would interact with existing standards for tax agents, such as the HMRC standard for agents and the Professional Conduct in Relation to Taxation (PCRT) .

Authorised Economic Operator (AEO) status

Authorised Economic Operator Customs Simplification (AEO(C)), often referred to simply as AEO, was a commonly raised theme.^{[footnote 1]} Some respondents felt that AEO and its potential links to a voluntary standard should be considered, whilst others felt that AEO already achieved the objectives of a voluntary standard and rendered it unnecessary. Some suggested that AEO could be amended or enhanced to better capture those objectives if deemed necessary, and several who raised AEO referenced its international recognition, questioning the weight of a UK standard by comparison.

AEO(C) is an authorisation which is available to both traders and customs intermediaries. AEO(C) status holders have demonstrated that they are fully tax compliant, keep good customs records, have financial solvency to meet their commitments to creditors, and have practical experience in customs matters. Holders of AEO(C) can benefit from faster application processes for customs simplifications and authorisations, a reduction or waiver for guarantees and deferment accounts, and could benefit from fewer customs checks on their documents and goods.

AEO(C) is not a mark of excellence, and it does not measure the quality of service a customs intermediary (or trader) provides to their customers. Whilst AEO(C) will test the competence of a customs intermediary or trader in relation to its own customs procedures, it does not take into account how that party uses that competency when providing a service to others.

A voluntary standard for customs intermediaries would constitute a mark of excellence, with more of a focus on the holistic service provided by a customs intermediary to their customers. It would set out detailed expectations of best practice across key areas, including customs knowledge and competence, customer service, and staff development. Fundamentally, it would exist to provide clarity on what a trader engaging the services of a customs intermediary should expect.

The government therefore concludes that the purpose of the AEO(C) authorisation is different and that there is merit in introducing a standard which sets best practice solely for customs intermediaries. We recognise that there will be synergies between AEO(C) and a voluntary standard, which we intend to explore and consider as part of developing the standard to avoid duplication.

Objective of a voluntary standard

Many respondents suggested that informing and educating intermediaries and traders would be an important element of a standard and that setting out best practice in one place would help to support the sector. However, most respondents also agreed that the primary objective should be to promote quality and consistency among customs intermediaries and to do that the standard should be suitable for independent third-party certification. Reasons cited often included the assurance, credibility, and consistency that model would provide.

A number of stakeholders noted that robustness of the standard should be balanced with complexity and burden for intermediaries. Some suggested that it would be difficult to design a measurable standard that adequately captured the variety of business types and models in the sector.

Some felt that HMRC should be involved in or solely responsible for the certification process. Reasons given included the potential cost of third-party certification, the ability of certification bodies to assess the diverse intermediary population, and the potential for inconsistent assessment from different certification bodies. 

The majority of respondents agreed that certification bodies should themselves be independently assessed and accredited. Reasons included ensuring the capability of the certification body, the impartiality and consistency of certification, and generally providing assurance and credibility.

A small number of stakeholders were concerned about the potential additional cost of accreditation noting the need to ensure costs were not prohibitive. Some respondents thought the UK Accreditation Service (UKAS) as the UK’s national accreditation body should be responsible for assessing certification bodies, but a similar number felt there was a role for HMRC, or for industry bodies.  

Several responses to the questions in this chapter made reference to AEO. Some suggested that the existence of AEO meant that a standard suitable for certification was unnecessary, that it already achieved the primary objective of promoting quality in the sector, or that certification could be linked to or designed as an enhancement to AEO.

Considering the feedback received, the government believes that while the primary objective of the voluntary standard should be to promote quality and consistency, with an indication of quality, this does and should not preclude the standard from delivering other important objectives, in particular informing and educating. The standard should be designed to be suitable for independent confirmation that intermediaries meet it (certification) and UKAS as the UK’s national accreditation body should be responsible for assessing certification bodies.

Design and implementation

Almost all respondents agreed that a voluntary standard should be designed through a credible, collaborative approach between government and stakeholders, freely and readily accessible, and monitored for usage and effectiveness. 

A minority of respondents were sceptical either of the proposed approach or that the standard would prove effective. Reasons given for this view were typically the existence of AEO, perceived difficulty of accounting for the different business models within the sector, and a lack of specificity about who would be involved in the design process.

Almost all respondents provided suggestions as to how to encourage usage of the standard, with promotion of the standard, for example by government or industry, being the most common suggestion. Some respondents noted the importance of there being adequate guidance or training in place to support adherence to the standard, and a small number highlighted the importance of official recognition of the standard.

Several respondents suggested that certification against the standard should confer some form of privilege or provide some incentive, or that there should be a published list detailing intermediaries who had achieved certification.

Other common suggestions were the ability to make the certification against the standard marketable (for example with a badge or logo), and that market forces, such as customer demand, would dictate the usage of the standard.

A small number stated that demonstrating the distinction between a voluntary standard and AEO would be a key factor in encouraging use.

The government therefore remains of the view that the standard should be designed through a credible, collaborative approach between government and stakeholders, freely and readily accessible, and monitored for usage and effectiveness. It will be important to ensure that the standard is designed in a way to ensure it is achievable for all types and sizes of customs intermediary providing a good-quality service.

Content

Most respondents supported the inclusion of all the proposed content elements, although many raised the need for further clarification, refinement, and the flexibility to account for the different business types, sizes, processes and services offered in the customs intermediary sector. Some respondents also noted the need to ensure a balance was struck between sufficient, suitable content and burden. Several respondents suggested that relevant existing standards should be considered as part of development, in order to minimise duplication and ensure coherence. Standards referenced included AEO, ISO 9001, HMRC’s standard for agents, and the PCRT.

Many responses provided suggestions for more specific or additional content for the standard. Some of the more common suggestions were a focus on intermediaries’ error/correction ratios, supporting environmental sustainability, and a modular approach to allow intermediaries to be assessed only on requirements relevant to their business model and services. Other suggestions included: a requirement for a transparent fee structure; a recommended timeframe for correcting errors; staff retention rates; digital literacy; data privacy requirements; ethical practices; and collaboration with customs authorities.

Some respondents raised concerns or challenges with the proposed content, including difficulties with measuring some of the proposed elements. A common concern was the potential cost and burden of adhering to the standard, for example the IT or system requirements, and the time it would take to achieve the standard.

Some smaller intermediaries in particular expressed concern over the cost and proportionality of training and development that would be required. Other common questions were on the practicality, levels and measurement of commitments to continuing professional development (CPD), and the type and availability of insurance cover that would be expected.

Other comments on the proposed components included how customer service levels would be measured, how staff turnover and the associated impact on expertise would be accounted for, how education or competence would be measured generally, and how the standard would be kept up to date.

The government is grateful for all of the valuable comments and contributions made in respect of the potential content for a standard. As previously outlined, we remain of the view that the specific and detailed content of a standard should be arrived at through a collaborative approach of the nature described in the previous section, and that the views received here will inform that process.

Training and educational offerings for the customs intermediary sector

More than two thirds of intermediaries who responded to this section confirmed that they used, or had used, external training offerings. Reasons for this included keeping up to date with changing trends and regulations, covering topics they were unable to facilitate in-house, and obtaining customs qualifications. However, some felt that the external training available was often too generalised, foundational, or theoretical. There was also no consensus on the perceived value of external training offerings, with a mix of positive feedback and concerns about variable quality and high costs.

The majority of intermediaries provided internal training to their staff. They highlighted the ability to provide bespoke training tailored to their business, which is more in-depth or focused than most external training. A minority also felt their internal training offer was more beneficial than external training, citing the importance of on-the-job training using real world examples and lower costs. However, most considered internal and external training to be equally beneficial overall, often noting the advantages combining the two. A minority of intermediaries who responded said they did not provide internal training, noting costs and business size as reasons for this.

There was no overall consensus on whether there are currently sufficient, adequate training offerings available to intermediaries, with a roughly even split between respondents. Some thought that the market had grown enough to support training needs and listed training providers they had used. Others reiterated the difficulty in determining the quality of training providers and the high, sometimes prohibitive, associated costs of external training.

Most respondents made suggestions for how to reference competency and education within a voluntary standard. These included: grading external training offers; setting a minimum level of education/experience or quantifying a set of criteria of customs knowledge required in order to be certified; and giving experience in the industry and on-the-job training equal weight to formal qualifications. Other responses underlined the importance of intermediaries demonstrating CPD to ensure training and education offerings remain current or noted that any standard should require businesses to keep training records.

The government understands that customs intermediaries find different types of training and educational offerings valuable for different reasons, and therefore intends that this should be reflected in the standard. There is likely to be a role for both formal training and on-the-job experience within the standard, to ensure it can be met by the broad range of high-quality customs intermediaries in the sector.

Next steps

The government has considered all of the feedback from stakeholders in response to the consultation, and is grateful for the valuable contributions from interested parties. The government has therefore decided to proceed with plans to introduce a voluntary standard for customs intermediaries, noting both the support voiced for the proposal and the questions and/or concerns raised during the consultation.

The government has always intended that introducing a standard should be done collaboratively with industry, and that this process should be robust and credible, to ensure maximum effectiveness. As detailed above, a significant majority of responses to the consultation agreed with these principles.

The government therefore intends to work with the British Standards Institution, the UK’s national standards body, to develop a robust standard that is suitable for certification. This well-established and credible process will involve meaningful co-design between government, industry and bodies with experience in developing standards. The process will include a public consultation on the draft text of the standard and will be developed transparently in partnership with industry. We expect this process to begin in Spring 2024 and welcome continued constructive engagement with industry as we develop a standard, in which government, intermediaries and traders can place their trust.

Annex A: List of formal respondents

There were 55 respondents in total:

Association of International Courier and Express Services (AICES)	Allied Fleet Services Customs Ltd	ALS Customs Services GmbH
APMG International	B&H Worldwide Ltd	British Chambers of Commerce and Chamber Customs Ltd
British International Freight Association (BIFA)	Brose Ltd	British Universities Finance Directors Group (BUFDG)
Casper Shipping Ltd	ChannelPorts Ltd	Charles Kendall Freight Ltd
Chartered Institute of Logistics and Transport (CILT)	Chartered Institute of Taxation (CIOT)	Cisco International Ltd
Claridon Group Ltd	Cranswick plc	Cratle Ltd
Customs Assured Ltd	Customs Practitioner Group (CPG)	Deloitte LLP
Elring Klinger (Great Britain) Ltd	Eurosprint Freight Services Ltd	EV Cargo Global Forwarding Ltd
Exertis UK Ltd	Federation of Small Businesses (FSB)	Gaston Schul Customs Ltd
GKN Aerospace Services Ltd	Grace Global Forwarding Ltd	Hillier Hopkins LLP
Hewlett-Packard (HP) Inc	Institute of Chartered Accountants in England and Wales (ICAEW)	Integrated Marine Services (IMS) Freight Ltd
Institute of Export and International Trade (IOE&IT)	JTI UK (Gallaher Ltd)	KlearNow
Kuehne + Nagel Ltd	Livingston International Inc	Logistics UK (Freight Transport Association Ltd)
Mann and Son (London) Ltd	Mercator Cargo Systems Ltd	Momart Ltd
Montgomery Transport Group	Morgan Cargo (UK) Ltd	NNR Global Logistics UK Ltd
Norgren Ltd	PricewaterhouseCoopers (PwC) LLP	Royal Mail Group Ltd
Simarco International Ltd	Tevolution Ltd	United Kingdom Accreditation Service (UKAS)
University of Warwick	Uniexpress Ltd	Vartan Consultancy Ltd
Warrant Group Ltd

Annex B: List of consultation questions

Question 1: What type of business are you? (such as clothes retailer, car manufacturer, freight forwarder, fast parcel operator, haulier)

Question 2: What is the size of your business? (Micro: 0 to 9 employees, small: 9 to 49 employees, medium: 50 to 249 employees, large: 250 or more employees)

Question 3: If applicable, how many movements do you make per year? Are they imports, exports, or both?

Question 4: If applicable, how long has your business been importing or exporting goods, or supporting traders to import/export if you are an intermediary?

Question 5: Do you agree that the primary objective of a voluntary standard for customs intermediaries should be to promote quality and consistency among customs intermediaries with an indication of quality, rather than to predominantly inform and educate? If not, what do you consider should be its primary objective, and why?

Question 6: Do you agree that a voluntary standard for customs intermediaries should be suitable for independent, third-party verification that the standard has been met, in other words, certification? If not, what alternative form do you think the standard should take, and why?

Question 7: Do you think certification bodies that provide that external verification should themselves be checked to ensure they are capable of assessing conformity to the standard, in other words, accreditation? Please provide details to explain your answer.

Question 8: Do you agree with the key principles for the design and implementation of a standard as set out above (in other words a credible, collaborative approach between government and stakeholders, freely and readily accessible, monitored for usage and effectiveness)?

Question 9: In your view, how could usage of the standard be encouraged?

Question 10: What are your views on the above suggested components of the voluntary standard? Please include any suggestions for potential specific requirements within these general areas.

Question 11: Should any of the suggested components not be included?

Question 12: Are there any areas missing that you feel should be included?

Question 13: Do you anticipate any unintended consequences arising from including any of the suggested content?

Question 14: Do you envisage any issues with measuring against these areas for the purposes of certifying intermediaries against this standard?

Question 15: If you are an intermediary, do you or your organisation use external training offerings? Please provide details to explain why/why not.

Question 16: If you are an intermediary, do you or your organisation provide internal training? Please provide details to explain why/why not.

Question 17: If you answered ‘yes’ to Question 15 or Question 16, what aspects of your work do you use external and/or internal training for? If you use both external and internal training, please explain if you use them for different aspects of your work (such as external training on customs processes, but internal training on using CDS).

Question 18: If you answered ‘yes’ to both Question 15 and Question 16, have you found either external or internal training to be more beneficial to your day-to-day work?

Question 19: Do you think there are currently sufficient, adequate training offerings available to intermediaries? Please provide details to explain why/why not.

Question 20: Considering the training and qualifications available to and undertaken by intermediaries, how do you think competence or education should be referenced within a voluntary standard? Please provide details to explain your answer.

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1. AEO(C) is one of two types of Authorised Economic Operator status, the other being Authorised Economic Operator Security and Safety (AEO(S)). It is assumed that references to AEO were generally in relation to AEO(C), unless otherwise specified, due to the different nature of many additional requirements required to hold AEO(S) status. ↩