Q: We are a UK business importing goods from around the world. Most of the time, we can claim preference by the statement of origin on the invoice from our suppliers. However, in the absence of this statement, we often use the importer's knowledge option when importing from the EU. We recently imported goods from South Korea, aware of the trade agreement between the UK and South Korea. For this shipment, there is no statement on the invoice and wondered if we could claim under the importer's knowledge for South Korean goods, or is this option just for goods of EU origin?
A: The use of importer’s knowledge to claim a preferential duty is not permitted under all UK trade agreements; it is specifically allowed under the UK-EU and the UK-Japan trade agreements.
The use of the importer's knowledge should be a last resort because it requires the importer to hold, within the UK, comprehensive production records for the goods. These records must detail the origins and values of all components and the processes undertaken in the exporting country and this level of documentation can be challenging to obtain and maintain.
In your specific case involving goods from South Korea, claiming preference using importer’s knowledge is not an option. Instead, you can request the South Korean supplier to reissue the invoice with the necessary exporter preference statement. If the goods do not qualify for preferential status, the supplier should confirm this in writing, stating that the goods do not meet the preferential criteria.
Additional Information
The Importer's Knowledge option is a mechanism provided in some trade agreements that allows importers to claim preferential treatment for duties based on their detailed knowledge of the production process and the origins of the goods. However, the UK has limited this option to only a few specific trade agreements to ensure compliance and accuracy.
Steps to Ensure Compliance
Verify Trade Agreements: Before relying on the importer's knowledge option, verify if the specific trade agreement between the UK and the exporting country allows this method.
Documentation: Maintain comprehensive records of the production process, including the origins and values of all components.
Communication with Exporters: In cases where the statement of origin is missing, communicate promptly with the exporter to obtain the necessary documentation.
By following these steps, UK importers can ensure compliance with trade regulations and maximise the benefits of preferential duty rates where applicable. While the importer's knowledge option is a useful tool, it is not universally applicable. Understanding the specifics of each trade agreement and maintaining thorough documentation is crucial for successful and compliant import operations.
Do you need help navigating the complexities of international trade?
Our award-winning in-house team and network of experts have years of experience supporting businesses through the complexities of trading globally. We work with you to tailor our support to your specific needs through our flexible advice and compliance services such as:
Rules of Origin and Trade Agreements Review: Get assistance determining the origin of your products and the preferential status of the goods, ensuring your audit trail is complete and correct. Maintaining accurate evidence and records is key for compliance.
Tariff Classification Review: Commodity codes, also known as tariff codes, are crucial for customs purposes. Our team can guide you through the classification process to ensure compliance.
Customs Clearance & Audit: We are an HMRC compliant customs broker with offices in Manchester City Centre and Manchester Airport delivering customs clearance services to both, UK importers and exporters, of all sizes and sectors in every region of the United Kingdom. Our audit service includes a customs compliance assessment to help traders prepare for HMRC customs audits and identify potential areas of concern.
Inward and Outward Processing Relief Application: We assist with the application process for IPR and OPR schemes, which allow UK traders to claim relief of duty and/or VAT.
Carbon Border Adjustment Mechanism (CBAM): In partnership with approved suppliers, we provide CBAM briefings, training, and consultancy support. Check our upcoming training course here
Export & Import Documentation Services: We help with certification, legalisation, apostille & notarisation services of Certificates of Origin, EUR1s Movement Certificates, ATA Carnets, Import Certificates, and more.
For more information or to seek our services, please contact our team today by emailing international@gmchamber.co.uk or call us at 0161 3934314. We are here to help you navigate the complexities of international trade with confidence and efficiency.
Sources: i-croner, UK Gov.
Comments