Statutory guidance

Regulation 29B (4)(a) of the Customs (Import Duty) (EU Exit) Regulations 2018

Updated 10 June 2021

This statutory guidance was withdrawn on 24 February 2022

This public notice has been withdrawn and replaced by Notices made under the Taxation (Cross-border Trade) Act 2018 and Notices made under the Customs (Import Duty) (EU Exit) Regulations 2018 to reflect changes from 1 January 2022 about delaying import declarations for goods that are not controlled into Great Britain from Ireland and Northern Ireland.

The following paragraphs have force of law, by virtue of Regulation 29B (4)(a) of the Customs (Import Duty) (EU Exit) Regulations 2018.

The operation of the fit and proper test in Regulation 29B (4)(a)

In considering whether a person is a ‘fit and proper’ person for the purposes of these Regulations, an HMRC officer will have regard to the following factors:

• the person’s compliance record – an HMRC officer may consider that a person with a poor compliance record will not be regarded as fit and proper, as a poor compliance record represents an increased risk that the person will not meet their obligations under these Regulations
• HMRC will in particular consider whether that person, and any directors or senior employees of that person, have been involved in a breach of an obligation relating to tax or a customs obligation which in an HMRC officer’s opinion is firstly a serious breach and secondly relevant to the suitability of that person to be an eligible person
• an HMRC officer will generally only consider a person’s recent compliance record, starting 1 January 2018, for this purpose, although this time limitation may not apply in the cases of fraud or suspected fraud where HMRC action has not been concluded
• the question of whether the breach is a ‘serious breach’ will be determined having regard to the circumstances and nature of any breach and the number of breaches – in particular an HMRC officer will take into account:
  • relevance: an HMRC officer will consider non-compliance with respect to obligations particularly relevant to cross-border trade and therefore transitional EIDR, focussing on Customs, VAT and Excise obligations – this applies in particular to non-compliance with the transitional EIDR regulations
  • behaviour: non-compliance where obligations have been breached deliberately will be considered more serious than otherwise – this is especially the case where the non-compliance has been concealed from HMRC or established to be fraudulent
  • fraud and other types of criminal non-compliance will be considered to be more serious than other forms of non-compliance
  • repetition: serial non-compliance will be considered to be more serious than one off instances
  • ongoing non-compliance: HMRC will also take into account whether the person is the subject of or associated with a current investigation into non-compliance where the person has also been involved in past non-compliance
• an HMRC officer will look at the overall picture of a person’s compliance record in coming to a conclusion on whether or not a trader is fit and proper, but will take into account the factors that have been set out
• an HMRC officer will also consider whether the person is connected with another business which HMRC has considered not to be fit and proper, or would not consider to be fit and proper – in looking to see whether there is a sufficient connection HMRC may consider the degree of connection between the relevant person and previous businesses where persons have not or would have not been considered to be fit and proper, in particular an HMRC officer may consider that a person who was a director or senior employee of a business that has not been or would not be considered to be fit and proper, will not be considered to be fit and proper