TRADE CONTACT GROUP meeting Brussels, 11th May 2012 Item 4: Information on the Commission proposal for the Union Customs Code (Recast) (COM(2012)064 of ) Governance of the involvement of MS and trade experts in the process of legal implementation of the UCC Jean-Michel Grave Head Of Unit TAXUD, Unit A2 11/05/2012Trade Contact Group meeting

Purpose Propose a proper governance scheme to involve Member States and trade experts in a coordinated process of preparation and adoption of the UCC Commission acts. Expected outcome Common understanding with stakeholders on the governance scheme, based on the outcome of UCC Ad Hoc HLSG 4 May & TCG 11 May and subsequent comments. 1

Background Legal requirements to involve MS in the preparation and/or adoption of the UCC-related Commission acts + Repeated commitment from the Commission to consult + Major interest of such involvement and prior consultation for a proper preparation and future implementation of the UCC 2

Structure of this presentation Guiding principles of the involvement of stakeholders Constraints Legal Framework The Union Customs Code State of the legislative procedure Timeline for the adoption and application The UCC – related Commission acts (1 Delegated Act and 1Implementing Act for measures of general scope) Timing - preparation and adoption of UCC related Commission acts 3 main periods identified in respect of legal implementation of the UCC Planning of actions 3

Guiding principles Member States and trade experts must be involved in the preparation of the UCC-related Commission acts, irrespective of their nature (D/I) Distinction between the involvement of Member States at the stage of the adoption of Commission acts on the basis of a UCC in force with appropriate empowerments and at the stage of their preparation Multiplication of bodies should be avoided and the use of joint meetings (between various MS experts or between MS and trade) should be favoured Formulas should be found to involve MS and/or trade in the preparation of both D/I acts, while complying with binding procedural requirements at the stage for their adoption Dependency: availability of appropriate resources 4

Constraints Commission’s commitment to consult MS experts: Communication from the Commission Common Understanding on Article 290 TFEU Recital (3) of the proposal BUT Different procedural requirements for DA and IA: DA: MS experts shall be formally consulted but the Customs Code Committee (CCC) cannot be used for that purpose IA: MS shall give a formal opinion through a vote in the CCC Link between the DA and the IA implying a synchronised preparation and sequential adoption Need to find structures that ensures the involvement of the stakeholders and respects the legal constraints 5

Legal framework - Proposal for the UCC Council - Working Party on Customs Union Presentation of the proposal, follow up on alignments „Supporting tools” – Non paper, table of changes Presidency’s deadline for MS written comments on 2 tables of changes: Next meeting: European Parliament – IMCO (+ INTA, JURI) Presentation of the proposal by COM: 26 April 2012 Future work in EP: 30/05 - exchange of views, 18/09 – draft report, 29/11 – adoption in IMCO European Economic and Social Committee 08/05 – presentation, 23-24/05 – adoption by EESC State of the legislative procedure 6 The proposal COM(2012)64 final for the Union Customs Code (MCC recast) has been adopted and submitted to the legislature by the Commission on 20 February 2012

Legal framework - Proposal for the UCC Entry into force of the recast Regulation 20 days after publication (Art. 246 UCC) and at the latest on 24 June 2013; Date of application: date of entry into force for empowering provisions & Art. 46 UCC on charges and costs, already applied; 18 months after entry into force for other provisions (Art. 247 UCC) = 1 January 2015 at the latest IT work programme to be adopted by the Commission within 6 months of the entry into force (Art.17(1) UCC) : to be based on IT Master Plan and updated MASP; End-date of transitional periods and measures to be applied pending operational IT systems: 31 December 2020 (Art. 6(2)(c) UCC). Timeline for adoption and application 7

Legal framework – UCC related Commission acts Involvement of Member States’ and trade experts in the preparation of Commission acts General - Delegated act - Article 290 TFEU Adoption by the Commission, without entering into force; Notification to the European Parliament and the Council (Art 243 UCC: period for objection 2 months with possible extension of further 2 months; potential ‘early approval’); Publication and entering into force in case of now objection from EP and Council. Involvement of stakeholders Member States: Consultation of experts of all MS to be applied (Common Understanding on the adoption of delegated acts and the Commission guidelines on Article 290 TFEU); Registered group of experts, ad hoc meetings (the committee can not be used); Parliament, Council Information about the proceedings and documents of the meetings to be sent; Possible request for invitation for the meetings. Trade representatives Consultation may include trade representatives; Priority given to the conclusions drawn up by the COM in the meeting with MS experts. Delegated act 8

Legal framework – UCC related Commission acts Involvement of Member States’ and trade experts in the preparation of Commission acts General - Implementing act – Article 291 TFEU Adoption by the Commission; To be adopted after the entry into force of the delegated act as it may be linked to provisions of the delegated act; Member States: Formal involvement in the process of adoption of implementing acts trough the opinion of the committee; Parliament, Council Information about the proceedings; Draft implementing acts to be sent; No presence at the meetings; Trade representatives Documents available in Comitology register; Consultation and collection of information, expertise on particular matters to be ensure; No permanent presence within the committee foreseen. Implementing act 9

Timing - preparation and adoption of UCC related Commission acts 3 main periods identified for the preparation and adoption of UCC related Commission acts Period 1: from now until January 2013 (start of the actual preparation of the draft COM acts) Period 2: January 2013 – June 2013 (entry into force of the UCC Regulation) Period 3: June 2013 – October 2014 (entry into force of the Commission acts) 10 Pre-condition: the UCC is adopted in one single reading and enters into force at the latest on 24/06/2013

Q/A on the periods Q1: Why having chosen January 2013 as the starting date of the 2nd Period? A1: Drafting of DA/IA cannot start before the legislative procedure is far enough advanced to provide stable perspectives on both empowerments and content of UCC. And in order for the UCC proposal to be in force at the latest in June 2013, an agreement between the institutions should be found at the beginning of 2013 to be formalised by an adoption in April Q2: Why having chosen October 2014 as the end date of the 3rd period (entry into force of DA/IA)? A2: UCC+DA/IA shall apply on 1 January 2015 at the latest. DA shall be adopted 4 months before its entry into force to preserve the right of objection (2+ possible 2 extra months) of Council & EP. Moreover it is appropriate waiting for the entry into force of DA to adopt IA due to likely dependencies between both. It was not considered realistic envisaging an adoption of DA before June 2014 (= 1 year after entry into force of UCC). That explains the choice of October 2014 as the date of entry into force of DA/IA. 11

Period 1 – from now until the start of the actual preparation of the Commission acts Work to be done Production, review, finalisation of BPMs on the basis of COM proposal Continuation of the preparatory work on the Annexes (only concerning customs decisions and data requirements, annexes on BCP and transitional measures come in a later phase) COM proposal to be discussed only in Council and the EP Involvement of the stakeholders - Existing structure can be further used Member States Customs Code Committee (GEN and specialised sections + possible joint meetings) Group of experts meeting (organised on ad-hoc basis or registered) Trade representatives Trade Contact Group meetings Possible joint meetings or actions: –Involving both MS and trade (ECG+TCG, workshops) –Involving both MS legal and IT experts (ECG+CCC Sections) –Combining Ms and trade legal and IT experts From now – until January

Period 2 – from start of preparation of the draft Commission acts until the entry into force of the UCC regulation Work to be done Start of preparation of UCC DA/IA (as far as the empowerments for their adoption still do not legally exist); Preparation to be based on the ‘frozen’ MCCIP, taking into account the empowerments and the adjustments in the UCC proposal, as resulting from the legislative procedure; Preparation includes looking for appropriate solutions to remaining ‘open’ issues; Work to be completed on the Annexes of both future acts Involvement of the stakeholders – the structures used in period 1 can be further used January 2013 – June 2013 Precondition: the UCC as discussed by the legislature provides a sufficiently stable basis 13

Period 3 – from the entry into force of the UCC regulation until entry into force of the Commission acts Work to be done Drafting of UCC DA/IA; Adoption of UCC DA/IA Entry into force of Commission acts Application of Commission acts Involvement of the stakeholders Member States Consultation of MS experts on draft DA (Group of experts and/or Ad Hoc meetings: C2013 or budget line for expert groups) Opinion of MS on draft IA before their adoption by the Commission Trade representatives Consultation in TCG May be invited to meetings of MS experts June 2013 – October 2014 Objective: the adoption of the delegated and implementing acts in time for their application together with the UCC 14

Practical arrangements Existing or new registered expert group, beside CCC Possible terms of references of the consultation Possibility for ad-hoc expert meetings Timely planned, structured organisation of meetings Timely distribution of documentation 15

Adoption of the UCC proposal by COM Transmission to national parliaments Council, EP and EESC Launch 1st reading by Council /02/2012 Application of UCC Regulation 1st Reading Launch 1st reading by EP DK Presidency written procedures CY pres takes over IE pres takes over Interinstitutional contacts („Trilogue”) (Oct 12 – Jan 13) Position of EP at the 1st reading and COM position (Feb 2013) Drafting UCC DA/IA Adoption of UCC by Council after a single reading (April 2013) Enter into for of the UCC Regulation – (latest ) 16 Planning Period 3 Period 2 Period 1 13/04/ /06/2013 Adoption of UCC DA (June 2014) Adoption, publication and entry into force of UCC IA (Oct 2014) DK pres

Follow up Presentation to TCG – 11/05/2012 Comments to be sent by MS and trade experts by 31/05/2012 Preparation by TAXUD of a ‘Common Understanding’ on the external governance of the legal implementation of UCC to be endorsed by CPG and TCG 17