Electronic Customs Declaration

Roman Parfenov
Manager of Customs and International Trade Group
Ernst & Young

The electronic customs declaration of goods, i.e. when goods are declared at a customs office by submitting a customs declaration in electronic form via the electronic communications channels, is widely practiced in the world today.

In Russia, the first electronic customs declaration was submitted in 2002. However, this form of declaration did not become common at that time because it had no relevant legal basis and the customs offices were not adequately equipped. Electronic declaration and the submission of documents in electronic form for customs clearance were legally enshrined when the Customs Code was adopted in 2003.

In 2004, the Federal Customs Service adopted several legal acts determining the procedure for electronic declaration, then it gradually began to be used by the customs authorities, and certain participants in foreign trade switched to that form of declaration.

In 2008, electronic declaration received a new impetus when the Federal Customs Service developed the means for electronically declaring goods through the Internet. So there are now two methods of electronically declaring goods, namely the traditional method, when goods are declared through the allocated communications channels, and their declaration through the Internet.

These two types of electronic declaration differ, inter alia, in that when the Internet declaration is used, the declarant submits documents attached to the electronic declaration to the customs authorities, filling in the special electronic XML forms drawn up by the Federal Customs Service for most of these documents (invoice, waybill, etc.), while in the event of an ordinary electronic declaration, the documents attached to the electronic declaration are usually sent in their scanned, unformalized form. As regards the location of the declarant and the customs office, the Internet declaration does not depend on the distance between them, while for an ordinary electronic declaration they have to be in the same vicinity.

The advantages of the Internet declaration are that there is usually no need for the declarant to be personally present at the customs office, and that customs clearance is performed rather quickly, taking as little as 15 minutes to release the goods after the electronic declaration is sent out. Also, after sending the electronic declaration, the declarant receives electronic notifications concerning all the stages of the declaration movement: receipt at a customs office, acceptance, release, etc.

However, no specialist will maintain that the Internet declaration is the most simple and convenient method of declaration in all cases. In the event of such a declaration, documents must sometimes be presented in hard copy (e.g. when risks are revealed according to the risk management system applied by the customs service). Besides, the Internet declaration does not fully rid the declarant of the need to regularly visit the customs authority, e.g. when a customs inspection is being conducted, and in some other cases.   

At the same time, many experts believe that under certain circumstances the Internet declaration really speeds up the customs clearance procedure. For instance, ED2 (Internet declaration in legal language) may be conveniently used by participants in foreign trade who regularly declare relatively homogeneous items with more or less the same set of documents. Exporters and importers whose goods are not subject to certain types of risks may also fully perceive the advantages of ED2.   

However, using the Internet declaration is not as simple as merely switching on the Internet. The declarant must sign the relevant agreement with the Federal Customs Service, and his information systems must meet certain information security requirements and pass a special test. There is also a simpler variant when, for Internet declaration purposes, use is made of the services of the so-called “operator,” i.e. an intermediary company that went through all the coordinating procedures with the Federal Customs Service of Russia and entered into the relevant agreement. In this case, the above requirements do not apply to the declarant’s information systems.  

Not all the customs offices can currently accept electronic customs declarations in the ED2 form yet, especially because they are inadequately equipped with the necessary hardware. However, the Federal Customs Service has worked out and is implementing the program for gradually introducing ED2 throughout Russia. The list of customs offices that are adequately equipped is being continuously renewed on the official web site of the Federal Customs Service of Russia.  

The Concept of Customs Clearance and Customs Control of Goods at the Localities in the Proximity of the State Border of the Russian Federation is currently being implemented in Russia. In implementing the concept, the declaration of goods by means of ED2 will presumably be conducted as usual in the customs offices inside the country, while actual control will be exercised at the customs offices located in the border constituencies of the Russian Federation (the so-called “remote release”). In the first quarter of 2010, customs authorities intend to carry out an experiment in the remote release of goods, and its results will be used to decide whether that technology of customs clearance should extend to all the customs offices.