In Transit Newsletter 1 September 2020, we told you that we’re creating a new instance of the New Computerised Transit System (NCTS) specifically for Northern Ireland.

This newsletter explains why the UK will have 2 NCTS systems from 1 January 2021, the implications for NCTS users and the technical changes to the guarantee reference amounts.

Dual NCTS system from 1 January 2021

As a result of the UK leaving the EU and moving to the Common Transit Convention in its own right as a contracting party, the benefits of transit usage have been retained for UK businesses.

From 1 January 2021, transit movements to and from the UK will no longer be under Union Transit but under Common Transit. However, due to the needs of the Northern Ireland Protocol where transit movements will be treated as beginning or ending under Union Transit, this will exclude Northern Ireland.

This means that while the declaration data sets for Union and Common Transit are identical, completion rules for data items will sometimes differ between the 2 types of transit. For example, some information that may be optional under Union Transit will be mandatory under Common Transit or the other way round, according to the conditions and rules defined by the Common Transit Convention.

We have therefore introduced a separate NCTS service specifically for Northern Ireland to make sure the Common Transit Convention conditions and its rules are applied correctly.

Dual NCTS implementation overview – changes from 1 January 2021

Great Britain NCTS

From 1 January 2021 the existing Great Britain NCTS service will switch from Union Transit operation to Common Transit operation and from this point onwards it will only accept:

• departure and arrival declarations for Transit offices located in mainland Great Britain
• Crown Dependencies (Channel Islands and Isle of Man)

It will no longer accept the departure and arrival declarations for Transit offices located in Northern Ireland.

Northern Ireland NCTS

From 1 January 2021 the Northern Ireland NCTS service will go live and operate in Union Transit mode. It will only accept departure and arrival declarations in respect of Transit offices located in Northern Ireland.

It will not accept:

• departure and arrival declarations for Transit offices located in mainland Great Britain
• Crown Dependencies (Channel Islands and Isle of Man)

The country codes for the dual system

All Common Transit Convention members and their mode of transit operation (such as Union or Common) are identified within common reference data shared between all members’ NCTS systems. This is essential to make sure declaration data meets the applicable conditions and rules of the countries involved in any given transit movement.

As a result of this, the Great Britain and Northern Ireland NCTS services will operate with separate country codes:

• Great Britain NCTS will keep its country prefix GB
• Northern Ireland NCTS will use the prefix XI

NCTS needs region specific reference data, such as customs office codes, guarantee reference numbers and Economic Operator Registration and Identification (EORI) (also known as Trader Identification Number) to include the applicable country code.

• customs offices located in mainland Great Britain, pre-existing EORIs and related guarantees will therefore keep their GB prefix for the Great Britain NCTS service
• customs offices located in Northern Ireland, new Northern Ireland specific EORIs and related guarantees will all have the prefix XI (for example, the office code for Belfast Entry Process Unit will change from GB000142 to XI000142)

HMRC is identifying affected businesses who already hold a GB prefix EORI and will automatically issue them with an XI prefix EORI.

Traders with establishments or operations in Northern Ireland, or a history of trading with Northern Ireland, will be auto-allocated an XI prefix EORI, and will receive a notification by letter to confirm this.

You will also receive additional information concerning XI EORIs and their usage in a separate form of communications.

Implications for NCTS users

We have already contacted NCTS software developers to make them aware of the changes and provided a test environment so that they can make the necessary amendments.

Changes to transit declaration completion

In Customs Information Paper (CIP 7), ‘New Computerised Transit System Transit Declaration Completion’, we told you that the UK would become a contracting party to the Common Transit Convention and the effect of Common Transit operation on your NCTS declarations. The changes identified within CIP 7 will all take effect from 1 January 2021.

The restrictions around Transport International Routiers and the need to complete the office of transit field will also apply to Northern Ireland transits where the movement crosses Great Britain mainland including Crown Dependencies (Channel Islands and Isle of Man).

Changes to guarantee reference amounts

The need to give an accurate guarantee reference amount for guarantee types 0, 1, 2, 4 and 9 will be implemented in both Great Britain and Northern Ireland NCTS systems from 14 January 2021.

In exceptional circumstances, where you are unable to determine the guarantee reference amount, the Common Transit Convention allows the amount to be fixed at 10,000 euros for each transit operation.

For guarantee types 0, 1, 2, 4 and 9 where no reference amount is contained within the Transit declaration the system will automatically add the equivalent of 10,000 euros in sterling.

This will apply in all circumstances except for national transit movements, for example, Great Britain to Great Britain. National transit is not supported by the Common Transit Convention however, the UK will continue to allow its usage as a trade facilitation.

In addition, guarantee type 8 ‘guarantee not required for certain public bodies’ will no longer be valid for mainland Great Britain and Crown Dependencies (Channel Islands and Isle of Man).