Outward Processing I

Outward processing is a customs procedure which allows goods to be exported out of the EU for processing and then re-imported, with relief granted from import duties on the EU content of the goods. The process can vary from packaging to more complicated processing and manufacture of goods.

An application must be made by a business to qualify for outward processing. It is not available for some categories of goods, including certain agricultural goods. An authorisation may be issued by the national authority. A single EU wide authorisation is also available. There is a simplified authorisation for traders who use outward processing only occasionally.

Goods are entered into the outward processing procedure by the return of a declaration, with the relevant code. The AEP system allows automatic a verification process for authorised OP traders.

Outward Processing II

Goods are discharged from OP when all of the conditions of the procedure have been complied with, and the compensating products are then re-imported into the EU. The export declaration and reimportation declaration must be retained

There are two methods of calculating duty relief for goods exported under outward processing. By the added value method, duty is charged on the cost of processing export goods and transportation back to the EU. Costs are added to the value of the exported products to arrive at the customs value of the compensating product. Duty is charged on the difference between the customs value and the value of the exported product

The duty differential method is based on the amount of duty that would have been due on the export goods. The import duty is calculated on the full customs value of the compensating products, and there is deducted the import duty that would have been payable on the exported goods if they have been imported at the same time.

Processing Under Customs Control

Processing under customs control is a customs procedure. It allows goods to be imported from outside the EU without being subject to import duties. Duty is payable on the finished goods which are released for free circulation. The rate is that which would have applied if the goods had been imported directly.

Businesses authorised to use PCC may import goods with customs duties suspended. They may process them at their premises or elsewhere.

Goods are entered into PCC by entering the appropriate code on the SAD. The requisite invoices and commercial documents must be retained. The goods may be entered automatically through the AEP. The process verifies the trader’s authorisation to use the process

Authorisation is required to use the processing under customs control procedure. Security is required in connection with the authorisation, by way of a bond. There is provision for national authorisation and single EU wide authorisation. Authorisations must be renewed. They may be suspended or revoked if abused. The authorisation is subject to terms and conditions.

PCC may be authorised where

  • the rules regarding quotas and origin are not affected;
  • processing is permitted in the EU without harming the essential interests of Community producers of similar goods;
  • the imported goods can be identified in the processed product;
  • it would not be viable to restore the processed goods to their original condition;
  • the duty on the finished goods is less than that applicable to the imported goods.

Discharge from PCC

Goods are discharged and regarded as complete when all conditions have been complied with and compensating goods or products are.

  • released into circulation;
  • exported from the EU;
  • transferred to another procedure;
  • transferred to another state to be entered in a procedure in that state;
  • destroyed;
  • given up to Revenue.

A bill of discharge must be issued within 30 days of the expiry of the period of discharge. The bill of discharge is a summary report giving certain details of the goods declaration, the imported goods and compensating products, together with details of values.

The customs value of the imported goods plus processing costs may be used to calculate the duty on the compensating products. Alternatively, the transactional value of identical or similar goods for export to the Community or exported at the time may be used to determine value.

PCC is available only a limited extent in respect of agricultural products subject to the CAP.

Inward Processing

Inward processing is a customs procedure. There are two methods by which relief is available. Under the suspension system, the duties payable is suspended on importation with security being provided in the form of a bond. Under the drawback. system, the import duties are paid and reclaimed on export. In order to qualify for inward processing, the trader must intend to export some or all of the processed goods.

As with other customs procedures, the trader must be authorised. Security is required. There is provision for national authorisations or single trans-EU authorisation. There is provision for simplified authorisation for those who use the process only occasionally.

Goods are entered into inward processing by entering the requisite code in the SAD with details of the goods concerned. The invoice must be retained by the trader. The AEP system allows automatic verification process for authorised IP businesses.

Inward processing is restricted in relation to CAP goods.

Discharge from OP

Goods are discharged from the outward processing procedure by

  • export from the EU;
  • transfer to another procedure;
  • transfer to another EU state to be entered into another customs procedure in that EU state;
  • released to free circulation with the payment of duty, VAT and compensatory interest;
  • destruction of the goods.

A bill of discharge is lodged with the customs within 30 days of discharge. The Revenue examines the bill on a risk analysis basis to verify that it is in accordance with the trader’s underlying trading patterns.

When goods are released into free circulation on a regular basis, a deferred payment arrangement for duty liability may be put in place. The duty is calculated as that appropriate to the imported goods at the date of entry. Duty and any compensatory interest are payable at the time of release into free circulation in the EU.

Temporary Importation

Relief is available in some cases in respect of the temporary importation of goods. Such goods would be otherwise subject to customs duty, import VAT and in some cases, anti-dumping countervailing and excise duties

The reliefs are available principally for goods temporarily imported with a view to being re-exported.  They extend on certain imports for the purpose of a prospective sale.

Security must be provided by way of bond or otherwise, to cover the suspended charges. In certain cases, security is not required, including where goods move under an ATA carnet, traveller’s personal effects, means of transport, pallets and containers and certain agricultural products.

A temporary import authorisation is required. An import declaration claiming the exemption may be accepted as an authorisation once duly stamped by Revenue.  There is provision for a single EU wide authorisation. Persons who are authorised are subject to terms and conditions and are inspected by Revenue.


The maximum period of temporary importation is 24 months. Shorter periods apply in respect of certain goods. The period of importation is fixed at the date of authorisation. The date of expiry must be shown on the authorisation before it is issued. Exceptionally, the period may be extended.

The temporary importation is discharged when the goods are

  • exported outside the EU;
  • placed in a customs warehouse, free zone or transit;
  • released for free circulation on payment of import charges;
  • destroyed or placed under another customs treatment.

On export, Revenue must be satisfied that the terms of the temporary importation have been complied with.

Goods which are temporarily imported may be subsequently released into free circulation on payment of the charges plus interest. The amount of import duty charged on temporarily imported goods is the amount applicable when they were introduced into the temporary importation arrangements. Compensatory interest is paid if goods which are temporarily imported, are released into free circulation.

TI Qualifying Goods

There are various categories of goods which qualify for a temporary importation relief. They include

  • certain professional equipment owned by a person outside the EU and used by the importer or under his supervision;
  • goods for exhibition at a public event;
  • teaching aids and scientific equipment for research and teaching;
  • medical, surgical and laboratory equipment;
  • packing;
  • goods for use in production for export;
  • goods imported for the purposes of tests;
  • commercial samples, films tapes, suitable for advertising and publicity;
  • traveller’s personal effects;
  • publicity material;
  • goods imported for sports purposes;
  • publicity material

Temporary importation relief is available for certain classes of goods, which are imported with a view to a possible sale.  This includes goods other than e newly manufactured goods imported with a view for sale by action, works of art and antiques and consignment on approval

Importation relief is available in respect sea, and inland waterway means of transport. The maximum possible period is 24 months. In the case of private use, it is six months. Means of transport imported for commercial use must be used by a person established outside the EU.

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