Responsibility due to new version of Customs Code of Ukraine

18 May, 2012 Newsletters

Dear Sirs!

As known, starting from June 1, 2012 the new version of the Customs Code of Ukraine comes into force (hereinafter – “Customs Code”). KM Partners offers a cycles of newsletters concentrated on changes which can badly influence the business as well as innovations which can facilitate relations with customs.

Responsibility for the violation of customs rules, foreseen in Part XVIII of the Customs Code, is analyzed in this newsletter.

New Customs Code of Ukraine foresees the increase of responsibility for violation of the customs rules which business faces rather often, namely:

Penalty at the rate of 100 percent of the goods value and confiscation (applied compulsorily) are foreseen in the following cases:

  1. Article 472. Not declaring goods, vehicles of commercial purpose. Not declaring is instatement of the accurate and trustworthy information in the established form (existence, description or name, quantity etc.) regarding goods, transport of commercial purpose which are under compulsory declaring in case of moving across the customs border of Ukraine.
  2. Article 482. Movement or actions aimed at movement of goods, vehicles of commercial purpose across the customs border of Ukraine beyond customs control. Abovementioned actions foresee movement beyond the location of the customs body or beyond the working time determined for it and without customs formalities, or with the unlawful escape from the customs control as the result of official position usage by the customs officials. In case such actions are repeated for the second time within the year, the penalty shall be 200 percent of the goods’ value.
  3. Article 483. Movement or actions aimed at movement of goods across the customs border of Ukraine avoiding the customs control. Such actions foresee movement with the usage of specially created storehouses (hiding places) and other means or ways which complicate detection of such goods, or by means of providing one goods the form of others, or submission of the fake documents or the documents received by unlawful way or such containing untruthful data to the customs body as the basis of the goods movement. In case such actions are repeated for the second time within the year, the penalty shall be 200 percent of the goods value.

Penalty at the rate of 100 percent of the goods value or their confiscation are applied in the following case:

  1. Article 484. Storage, movement or purchase of the goods, vehicles of commercial purpose imported on the customs territory of Ukraine beyond the customs control or escaping the customs control.

Penalty at the rate of 1000 undeclared minimums of the citizens’ income with confiscation of the goods is applied in the following case:

  1. Article 476. Movement of goods across the customs border of Ukraine breaking the intellectual property rights.

Penalty at the rate of 300 percent of the unpaid sum of customs payments is applied in the following case:

  1. Article 485. Provision the untruthful facts in the customs declaration with the aim of unlawful exemption from customs payments settlements or decrease of their size and/ or provision the documents to the customs body containing untruthful information regarding considerable conditions of the foreign economic agreement (contract), weight, amount, country of origin, sender and/or receiver of the goods, untruthful data, required for determining the goods code in accordance with the Ukrainian Classification of Commodities for Foreign Economic Activity and its customs value, or settlement of the customs payments not within the terms determined by law or other unlawful actions aimed at evasion of the customs payments settlements containing no crime feature as well as the usage of goods in regards to which the customs payments privilege was provided with other aims besides the one in accordance to which the privilege was provided.

As appears from the abovementioned norms, in case of insignificant technical mistake, for instance, exceeding the actual amount of goods from the declared just for one goods’ unit or re-grading during filling of goods to the container, all goods shall be confiscated and the penalty of 100 percent shall be applied. The same concerns mentioning the code of Ukrainian Classification of Commodities for Foreign Economic Activity which differs from the one the customs considers mentioning. If a person purchases goods imported to Ukraine with violations of the customs rules, such goods shall be confiscated even from the honest buyer and he will be forced to pay the penalty of 100 percent.

In such case Article 460 of the Customs Code will be inefficient. This Article foresees that mistakes in the customs declaration not causing unlawful exemption from the customs payments settlements or their amount’s decrease if such mistakes are not systematic (in accordance with Article 268 of the Customs Code “systematic” means not more than twice a month) does not cause administrative responsibility envisaged by the Code.

Taking into account the abovementioned, special attention shall be paid to the filling of Cargo Custom Declaration as well as to the correctness of accompanying documents since it can result in considerable penalties and goods losses.

Besides, it is advisable to get the consultation from the customs authorities on the disputable issues (foreseen by Article 21 of the Customs Code). In case of disagreement with such advices they can be appealed in the court.

It is also necessary to warn the customs brokers on the consequences of their negligence and, if possible, to insure the aforementioned risks or to foresee the responsibility of customs brokers before the clients.

We hope the abovementioned information will be useful for you.

The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.

Kind regards,

© TOV "KM Partners", 2012

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