Guidance

Using similar goods to replace customs special procedure goods

How you can use, process or store similar free circulation goods in place of goods that you have declared for a customs special procedure.

• From: HM Revenue & Customs
• Published: 20 January 2020
• Last updated: 27 November 2024 — See all updates

You can use similar free circulation goods instead of goods imported to a customs special procedure. This is called equivalence. There are different rules depending on whether you store, process or use your goods.

You cannot use equivalence to offset exports of free circulation goods so you can reduce import bills on non-UK imports for use on the UK market.

When you use equivalence:

• if you do not re-export your imported goods, it cannot be because your customers have differentiated between your processing and free circulation goods
• if you’ve applied for authorisation for inward or outward processing as the goods you need are not available in the UK, you cannot use equivalence for UK-produced goods

You need to tell us you’ll use equivalence when you apply for a special procedure authorisation.

If you need to use equivalence after we’ve authorised you, you’ll have to apply for an amendment to your authorisation.

Before you start

The equivalent, free circulation goods you’re using need to have the same:

• 8-digit tariff commodity code
• commercial quality
• technical characteristics

You must also decide whether:

• you could swap the goods for each other
• the goods are not noticeably different
• your customers would accept the difference in goods

Goods with different rules

For all special procedures

Equivalence does not apply where the goods or the equivalent goods have been genetically modified, or contain elements that have undergone genetic modification.

Inward and outward processing and customs warehousing

Equivalence does not apply between goods that have been produced, prepared and distributed as ‘organic’ under the terms of Council Regulation (EC) No 834/2007 and those that have not.

Inward processing

When using equivalent goods with inward processing there are different rules for some goods.

Goods	Rule for equivalent goods
Rice	Authorised under tariff heading 10.06. It can only be approved where the length and width ratio of the rice falls within certain parameters.
Wheat	Can be authorised between non-UK harvested wheat released to free circulation and non-UK wheat.
Sugar	Equivalence is allowed between raw cane sugar falling within CN code 1701 11 90 and raw beet sugar falling with CN code 1701 12 90 to produce white sugar falling within CN code 1701 99 10. The time limit for importing the replacement goods is limited to the period of validity of the import licence.
Live animals and meat products	The use of equivalence for live animals and meat is prohibited. The ban can be lifted in exceptional circumstances — contact HMRC if you consider that such circumstances apply.
Milk and milk products	Only permitted on condition the milk dry matter, milk fat matter and milk protein of the equivalent goods is not lower than those in the imported goods.

Outward processing

You cannot use equivalent goods if you’re processing sensitive goods.

When to contact your authorising officer

The rules for some goods are complicated, you will need to contact your authorising officer if you want to use equivalent goods with:

• maize used for animal feed
• maize used for the production of starch
• maize for the manufacture of meal
• olive oil
• olive-pomace oil

How to use equivalent goods

Storing equivalent goods together

You can store the equivalent goods with those you’ve declared for free circulation, this is known as common stocking.

You do not need to be able to tell the difference and you can use any of these goods to fulfil an order. Your records should show which goods were declared to customs warehousing and which goods are free circulation.

If you import goods for process or repair under inward processing, you can export a replacement part that you have already repaired if they meet the criteria for equivalence.

You can use common stocking with the special procedures:

• inward processing
• customs warehouse
• authorised use

Storing goods in a customs warehouse

You can store equivalent goods with any other UK or non-UK goods. We might ask you to identify the equivalent goods at certain times.

If you cannot do this, we’ll calculate the amount of equivalent goods by looking at the number, type, status and origin of each type of goods.

You cannot use equivalence to offset exports of free circulation goods so you can reduce import bills on non-UK imports for use on the UK market.

Inward processing — prior export equivalence

You can export products made from equivalent goods in free circulation before you import the goods you need for processing or repair. This is known as prior export equivalence.

You can use this:

• to complete an urgent order if you do not have inward processing goods in stock, you can export goods immediately using equivalent goods drawn from your free circulation stock
• if you estimate your expected exports but find you have underestimated, you can export free circulation goods to meet your order
• if you have a low number of exports and do not separate your imports between inward processing and free circulation in advance, you can import all your goods to free circulation before ordering replacements

You can then import replacement goods to inward processing and use them as you wish without having to pay duty.

You must import your replacement goods within 6 months.

You can also transfer the benefits of prior export equivalence to another person named on your authorisation.

Using equivalent goods with temporary admission

You can export the following free circulation goods in place of the goods you imported when you’re authorised for temporary admission:

• pallets
• spare parts, accessories and equipment for pallets
• containers
• spare parts, accessories and equipment for containers

Outward processing

When using equivalent goods with outward processing they must be non-UK goods which are processed instead of UK goods.

Using the standard exchange system when exporting goods for repair

The standard exchange system allows you to import replacements for goods that you have exported for repair.

Replacements imported using the standard exchange system must have the same:

• 8-digit commodity code
• technical characteristics
• commercial quality as the goods being exported after they have been repaired.

If the goods you send for repair have been in use for some time, the replacement goods must be pre-used.

New products cannot be used under the system unless the replacement is supplied free of charge under guarantee or warranty or because of a manufacturing defect.

If the supplier cannot provide you with an exact replacement (for example, the model is no longer manufactured), you may import the closest equivalent, even if that means it is an upgraded version.

The system cannot be used for common agricultural policy goods.

After you’ve used equivalent goods

When you’ve used equivalent goods their status may change when they’ve been processed, discharged or have left the UK customs territory.

The records you need to keep will be explained in your special customs procedure authorisation letter.

Customs warehousing and temporary admission

Your equivalent goods become non-UK goods when you release them for discharge, or when they have left the UK customs territory.

Inward processing

The equivalent goods and the processed products that are made will become non-UK goods. The goods they’re replacing become UK goods when they are released for discharge or when they have left the UK.

If you put goods that have been processed under inward processing up for sale before you have discharged them, their status will change from non-UK goods to UK goods. If the equivalent goods are not available when you put your goods up for sale, you can request that the equivalent goods are made available later. You must contact your supervising office to request the additional time.

If you import replacement goods before you export the domestic goods — known as ‘prior exportation’ — the equivalent goods and the processed products that are made from them become non-UK goods when you export them.

Published 20 January 2020
Last updated 27 November 2024 + show all updates

1. 27 November 2024

   The ‘Inward processing — prior export equivalence’ section of the guide has been updated to show you must import your replacement goods within 6 months.

2. 11 January 2022

   The list of goods with different rules has been updated with changes to organic and genetically modified goods.

3. 24 November 2021

   The entry for genetically modified goods in the table in the 'Goods with different rules' section of the guide has been updated.

4. 31 December 2020

   This page has been updated because the Brexit transition has ended.

5. 20 January 2020

   First published.