UK Continental Shelf Customs Declaration by Conduct

ByAlegrant editor

Published 21 Nov 2024 – Updated 28 Nov 2024

The UK Continental Shelf (UKCS) Declaration by Conduct is introduced by HMRC to simplify the clearance of goods moving to and from the UK Continental Shelf (UKCS).

To use this type of declaration, traders “simply” need to provide customs information in a new form and load or unload a vessel or aircraft moving qualifying goods to and from the UK Continental Shelf.

Alternatively, traders can still choose to make full customs declarations or use simplified customs declaration processes. 

Traders must use full or simplified declarations for goods that do not qualify for the Declaration by Conduct.

In this article we review the regulations and the obligations for the UKCS new declaration.

Further information will be available and the regulations may be updated during the transition period. We’ll come back and update this article.

Customs Declaration by Conduct

In the UK Post-Brexit Customs Code we can find four types of customs declarations:

  • Customs declaration made in an electronic form,
  • Customs declarations made orally,
  • Customs declarations made in paper form,
  • Customs declarations made by conduct.

The simplification mechanism for the UKCS shipments relies on a Customs Declaration by Conduct.

The UK Continental Shelf simplification is therefore technically an extension of the use of the Declaration by Conduct to a new industry sector.

Declarations by Conduct are already widely used every day in the UK but in other contexts—for example, for NATO forces, private aircraft or, more commonly, for travelers passing through the “Green” or “Nothing to Declare” channel at airports. As such, it is not a new or unfamiliar form of declaration.

While the UKCS Declaration by Conduct is often referred to as “a form” or “a G-form” , it remains a customs declaration for free circulation, meaning all compliance requirements apply.

“It is not a return to the pre-2016 (CCC) used of manifest, for those remembering that time” said Catherine Truel, Alegrant Director.

Legal framework

HMRC has also published a Guidance: “Moving goods between Great Britain and the UK Continental Shelf”.

UK Continental Shelf Transactions in scope

The Declaration by Conduct is available to goods shipped: 

  • From GB to the UK Continental Shelf.
  • From the UK Continental Shelf to GB.

The Declaration by Conduct is available for goods used in Oil & Gas or renewable sectors such as Wind farms.

Goods in Scope

The Declaration by Conduct applies to “Domestic Goods”. Domestic Goods are defined in the Taxation (Cross-Border Trade) Act 2018 (TCTA) as: 

“Goods that have been subject to a chargeable Customs Procedure”. 

The Act specifies that this is the case if:

  • “The goods were declared for the free-circulation procedure and the procedure has been discharged.
  • The goods were declared for an authorised use procedure and the procedure has been discharge.“

Goods must be in free circulation in the UK. This therefore excludes goods under ATA carnet, goods under Special Procedure such a Customs Warehouse or IPR.

Goods under End-Use (Authorised Use) are considered “Domestic Goods” only if they have been fully discharged and follow certain rules that we’ll explore later in this article.

In addition to the TCTA, the CIDEER regulation adds that in order to use the Declaration by Conduct at import, the re-imported goods must meet the requirements for the Return Goods Relief Procedure stating that a person: 

“may make a Customs declaration for the free-circulation procedure by the conduct (…) in respect of (…) the re-importation of the goods from the installation if, at the time of import, full relief from import duty is available (…) by virtue of section 37 of the UK Reliefs document (returned goods relief).

Because not all goods are suitable for Return Goods Relief (RGR), this requirement will exclude certain products.

The goods eligible must therefore be:

  • Domestic goods suitable for Return Goods Relief at import when returning to GB or
  • End-Use (authorised use) goods fully discharged or
  • At import, goods of human and domestic waste that has no commercial value and is intended for disposal are eligible as long as the waste is not intended for resale or recycling (HMRC Guidance Moving goods between Great Britain and the UK Continental Shelf dated 27 November 2024).

Goods falling outside these criteria will need to be declared using a full or simplified declaration (or EIDR).

Goods not regarded as “Domestic Goods” and exclusions

The regulation (CIDEER) excludes certain goods for the Declaration for Conduct at import:

  • Goods requiring a licence such as goods subject to export control (controlled goods) or goods prohibited.
  • Excise goods.
  • Goods liable to value added tax.

The regulation (CEDEER) excludes certain goods for the Declaration for Conduct at export:

  • Goods with application for repayment or remission of import duty which has not been rejected or otherwise determined.
  • Goods with a tariff suspension.

These goods will be subject to the normal border controls.

End-Use (Authorised Use) goods: In and Out of Scope

At the time of import into the UK, End-Use (Authorised Use) goods would normally have been entered under the Authorised Use (End-Use) Customs Procedure. This would have been done using a full, simplified declaration (or EIDR). These goods can then be exported to the UKCS using the Declaration by Conduct. It is at import, when they come back from offshore, that the Declaration by Conduct may not be available for certain goods.

Prescribed use and re-import

The End-Use goods must have been put to the prescribed use on the UKCS to be eligible for the Declaration by Conduct at import when they are returning from offshore.

Goods not used offshore

If goods have not been used offshore, then the End-Use has not been discharged and the goods must be declared at import on return to the UK using a Standard or Simplified Declaration (or EIDR). These goods can be returned to the End-Use (procedure) or to Free Circulation with payment of duty and taxes.

Specific Conduct for UK Continental Shelf Declaration by Conduct

The specified conduct for import and export to use this type of declaration is described in the regulations as follows:

  • A person submits information to HMRC in a specific format to a specific system; and
  • A person loads or allows the goods to be loaded from a location in Great Britain onto a vessel or aircraft destined for an installation on the UK sector of the continental shelf.

The regulation requires that HMRC must publish a notice specifying the electronic system to be used, the information required to be submitted, the form and manner in which that information must be provided and the time by which it must be submitted. 

The detail of information and format is due to be published by HMRC in a notice on November 27th.

Eligible person

The regulations define an “eligible person” for the purpose of the UK continental shelf simplifications under two scenarios:

  • The authorisation is automatically granted. This would be most traders that do not need to apply for an authorisation.
  • The person is approved as an eligible person by HMRC. This will apply to businesses who have been informed by HMRC that they are not eligible. This would be because of previous non-compliance that resulted in a revocation of certain facilities. These traders would have to apply and would be eligible only once they have obtained an authorisation. 

Authorisation, Application and Approval

The regulation allows any eligible person, without prior application for approval, to apply the UK continental shelf simplified import procedure.

While the authorisation to use the Declaration by Conduct does not require an application, it is subject to revocation.

Declarant for the UK Continental Shelf Customs Declaration by Conduct

Similar to a Standard Declarations, the Declaration by Conduct can be prepared and submitted by traders themselves, carriers or customs agents.

The trader and (if applicable) the person submitting the declaration must have an EORI number.

As for any other Standard or Simplified Declaration, there is only one importer/exporter (EORI) per customs Declaration by Conduct. In practice, this means that there can’t be a customs declaration covering a whole range of suppliers for “Owned” and “Rental” goods. Again, this is not a return to the pre-UCC manifest.

Non-UK importer/exporter without an EORI can’t carry out customs formalities in the UK. This person will have to get a customs agent to carry out the formalities on their behalf.

Import

Customs notification at import

As for other customs declaration, a notification of the importation of goods into the United Kingdom must be given to HMRC by the traders themselves, the carrier, the customs representative. Where a person has submitted information to a specified electronic system for the UK Continental Shelf Declaration by Conduct that person is deemed to have notified HMRC at the time the information is submitted.

Customs Declarations by Conduct: notification, acceptance and discharge

Where a Customs declaration for the free-circulation procedure is made by conduct a notification of importation of the goods is to be treated as occurring, on

  • Submission of information to a specified electronic system and
  • Loading the goods (or allowing them to be loaded).

The acceptance of the Customs declaration and discharge of the goods from the free-circulation procedure are to be treated as occurring:

  • Where the submission of information to a specified electronic system is made before the vessel or aircraft arrives in Great Britain, arrival of the vessel or aircraft in Great Britain; or
  • Where the submission of information to a specified electronic system is made after the vessel or aircraft arrives in Great Britain, the submission being made.

Export

Customs notification, declaration acceptance, Release of the goods

Under the UK Continental Shelf Declaration by Conduct:

  • The notification of export of the goods,
  • The acceptance of the export declaration; and 
  • The release of the goods to, and discharge of the goods from, a common export procedure.

are treated as, or deemed as, occurring at the later of two events: 

  • The completion of the conduct and 
  • The departure from Great Britain of the vessel or aircraft transporting the goods to the installation on the UK sector of the continental shelf.

In simple terms, the rules treat the timing of these actions as happening when the later of these two events occurs.

The regulation (CEDEER) specify that no notification of acceptance of the export declaration is required to be made by HMRC to the declarant.

Preparing and Submitting a Declaration by Conduct for UK Continental Shelf Shipments

 The final details of information and format are due to be published by HMRC in a notice on November 27th. Further information will be published during the transition period.

The form 

The data required to support a UKCS Declaration by Conduct will be submitted using a “UK Continental Shelf Form”. Final format and details will be provided by HMRC on 27 November 2024.

The data

As for all customs declarations, the minimum data include:

  • Classification: Commodity Code as per the General Rules of Interpretation;
  • Valuation: Value of the goods as per the valuation rules;
  • Origin: Non-Preferential or Preferential Origin depending on the transaction;
  • Customs Procedure.

Amending or Withdrawing a Customs Declaration by Conduct

The TCTA specifies that a customs declaration can be amended or withdrawn only before:

  • HMRC inform the trader that they intend to verify the goods
  • HMRC officer is taking step to verify the declaration and 
  • HMRC inspecting the declaration.

After that time the trader will have to notify HMRC of the intention to proceed to an amendment or the withdrawal of the declaration to HMRC and obtain the acceptance from the customs officer. 

Further guidance from HMRC is required to provide clarification. In the meantime, some answers have been initially provided by an HMRC.

Withdrawal (Cancellation) of a Declaration by Conduct

Withdrawal is not available. The trader internal record-keeping must show the cancellation and provide an audit trail to the transaction.

Amendment of a Declaration by Conduct for “minor” changes

Amendments to the declaration are not allowed for minor changes. Instead, such changes must be clearly documented in the internal record-keeping for the transaction. Examples of minor changes have been given by HMRC Guidance include adjustments to the date or the number of packages. However, a clearer definition of “minor changes” is needed to prevent potential compliance issues.

Amendment of a Declaration by Conduct for other changes

“Non minor” changes that alter the original transaction require a new declaration. For example, adjustments to customs procedures or an over-shipment requiring additional goods to be declared will necessitate a new submission, which must be linked to the reference number of the initial declaration.

Obligations and Responsibility

While the process is simplified, it does not mean customs compliance can be taken lightly. Businesses are still responsible for:

  • Keeping accurate records for all transactions, including invoices, airway bills, and submission references.
  • Ensuring declarations are accurate and meet HMRC requirements.
  • Maintaining a clear audit trail for inspections.

If using a customs agent, it’s crucial to have a written agreement outlining responsibilities, as the trader remains liable for customs debts and compliance errors.

Record keeping and compliance obligations

The submission reference and its number will serve as key evidence, similar to the customs declaration reference number. They will be used to track and identify transactions within internal records.

As for any other export or import declaration, the audit trail must include invoice, transport documents, commercial document, stock records and financial documents.

Return Good Relief: The submission reference or a copy of the submission can be used to support a claim for Returned Goods Relief.

HMRC Guidance

  • records to identify eligible goods and demonstrate eligibility or declaration by conduct
  • the required evidence to support claims for Returned Goods Relief
  • evidence of discharging from the Authorised Use procedure, including submitting Bills of Discharge to the supervising office
  • evidence of goods origin to show they are not subject to controls
  • the value of goods and evidence to show how the value was determined
  • commodity codes
  • a packing list, inventory or manifest

If you do not own the goods, you’ll need to keep the following additional records;

  • copy of the form submission and unique submission number
  • copy of manifest or bill of lading
  • contracts or written agreements between parties involved in moving goods including transportation
  • authorisation or permission from third parties if the declaration is on their behalf
  • container numbers if the goods are in containers
  • proof of final destination of goods

Records must be kept for 4 years from the time of the acceptance of the declaration.

Not using the UK Continental Shelf Customs Declaration by Conduct

Goods may still be exported to and imported from the UKCS by using one of the following declaration processes:

  • Full declarations (normal procedure)
  • Simplified Declaration Procedures (SDP)
  • Entry in Declarant’s Records (EIDR)

It’s worth noting that goods that do not qualify for the declaration by conduct must still be declared using these standard methods.

Alegrant insights  

  • From the scenario planning exercises we conducted, we found that the new simplified declaration can enhance efficiency for certain businesses. It is particularly well-suited for regular and straightforward shipments to the UK Continental Shelf, as it reduces administrative burdens.
  • For businesses handling a mix of controlled goods, rental items, and end-use products across various types of transactions, the need to manage multiple types of customs declarations can lead to increased costs and risks.
  • Customs responsibility lies with the declarant, often the exporter and importer. Therefore, any shift in responsibility—such as an operator declaring “not owned” equipment on behalf of subcontractors—should ensure the goods qualify for the Declaration by Conduct. In certain cases it may be necessary to consider a change in Incoterms or contractual agreements.
  • The regulations clearly rely on the requirement for record-keeping and maintaining a sound audit trail, which are crucial when using this form of declaration. As for all customs declarations, inadequate documentation or incomplete audit trails can cause issues during inspections or audits. If you need to check the robustness of your internal audit trail, get in touch, we’ll review your compliance practices against the regulations and suggest improvements for pristine compliance records.

The UK Continental Shelf Declaration by Conduct is a significant step towards simplifying customs procedures, but it requires careful planning and understanding of the regulations. Whether you need advice on qualifying goods, guidance on record-keeping, or help with implementation, we’re here to support you every step of the way. Contact us today to arrange an informal chat.

References

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