Authorised Economic Operator (AEO)

About the AEO programme

The AEO programme was introduced by an amendment to the Community Customs Code in April 2005 (European Parliament and Council Regulation No 648/2005). The aim of the AEO programme is to maintain a proper balance between heightened security requirements and the facilitation of legitimate trade. The AEO concept is based on the internationally recognised SAFE Framework of Standards adopted by the World Customs Organisation (WCO).

What is an AEO?

An AEO is a reliable economic operator that has been granted this status by a competent customs authority in the European Community in respect of whatever function it has been authorised to perform (e.g. customs, logistics, human resources, finance, security, IT, supply chain management, manufacturing and sales) in the course of customs procedures.

Who issues the AEO certificates?

Since 1 January 2011, the National Tax and Customs Authority’s (“NAV”) county customs directorates, and the Customs Directorate for Exclusive Matters and Taxpayers (“KAVIG”) are responsible for issuing AEO certificates.

How to obtain an AEO certificate

You can download the application form for AEO status and the explanatory notes by clicking on the following links:

• Application for AEO Certificate (in Hungarian)
• Explanatory Notes (in Hungarian)

Why you should apply for an AEO certificate

If you have a local customs clearance authorisation, you can use the imported goods and release them for free circulation 24 hours a day, without the presence of customs officials.

Under Article 2 of Commission Regulation (EC) No 1192/2008 amending the implementing provisions of the Community Customs Code, by 1 January 2012, NAV’s county customs directorates, and the Budapest customs directorate, will have to carry out a reassessment based on the AEO requirements of the authorisations they have granted for local clearance procedures. As part of the reassessment, and in compliance with the AEO criteria, a new authorisation procedure will be carried out either at the economic operator’s request or ex officio.

If the economic operator concerned fails to obtain an AEO certificate by 1 January 2012, or does not comply with the relevant requirements, its local customs clearance authorisation will be revoked as of that date.

From 1 September 2009, economic operators with AEO certificates can also obtain import VAT self-assessment licences, irrespective of their sales figures. The self-assessment licence is significantly more advantageous to AEOs in terms of financing import VAT.

In addition, as a result of recent amendments to the Hungarian Excise Act, certificate holders are entitled to certain benefits related to excise duty.

What are the applicable regulations?

• Article 5a of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code; and
• Articles 14a-14x of Commission Regulation (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code.

How long does it take to meet the requirements and obtain a certificate?

In our experience, the preparations for obtaining an AEO certificate may take 3 to 6 months to complete (depending on the type of certificate). The subsequent customs authorisation procedure will take an additional 4 to 6 months.

Types of AEO certificate

There are three types of certificate:

• Customs simplifications – appropriate for businesses that wish to benefit from simplifications provided by the customs regulations;
• Security and safety – appropriate for businesses that wish to benefit from simplifications during the customs audit as regards security and safety standards; and
• Customs simplifications/Security and safety – appropriate for businesses that wish to benefit from simplifications provided by both of the above types of AEO certificate.

What are the benefits of the three types of AEO certificate?

1. If you hold a customs simplifications AEO certificate:

• You can obtain customs authorisations for simplified procedures more easily. During a simplified authorisation, the criteria that were previously examined for issuing the AEO certificate will not be re-examined.
• You will be subject to fewer physical and documentary checks than non-AEOs: as a result, your goods will cross Community borders faster, and the time required for customs clearance (e.g. when exporting the goods or releasing them for free circulation) will be less. You will be given a lower risk score than non-AEOs in customs’ risk analysis systems in all Member States, as AEO certificates are mutually recognised throughout the EU.
• If physical controls are to be conducted, you will be given priority over non-AEOs (your consignments will have to be checked first). At your request, these checks may be carried out at a location other than the customs office involved (e.g. at your site), which further simplifies the customs procedure.
• From 1 January 2009, the Hungarian customs authority only grants authorisations for the simplified declaration or the local clearance procedure if most of the requirements for the customs simplifications AEO certificate are met. Until 31 December 2011, the customs authority will review the authorisations for the simplified declaration and the local clearance procedure issued before 1 January 2009 in order to determine whether the AEO criteria are fulfilled. If the criteria are met, new licenses will be issued to replace the previous ones. If you have a customs simplifications or a combined customs simplifications and security and safety AEO certificate, your compliance with the AEO criteria will not have to be re-examined.

2. If you hold a security and safety AEO certificate:

• Before the goods arrive in the customs territory of the Community, the Customs Authority will notify you if, as a result of a risk analysis, the consignment has been selected for further physical checks. The inspection and clearance process will therefore become more transparent and predictable.
• You may lodge entry or exit summary declarations subject to the reduced requirements regarding the information to be given when your goods cross the customs border of the Community, which will reduce the administrative burden.
• Similar to the benefits of the customs simplifications AEO certificate, you will be subject to fewer physical and documentary checks than non-AEOs, will be given priority treatment in customs clearance procedures, and will be able to choose the location for the customs checks.

3. If you hold a combined customs simplifications and security and safety certificate, you will be entitled to receive the benefits of both types of certificate.

Are there any other benefits in having AEO status?

There may be other indirect benefits in having AEO status. These include:

• a better relationship with the customs authorities (when applying for AEO status, good cooperation is usually established with the competent authorities, which may be useful at a later stage);
• being recognised as a safe and secure partner (an AEO who meets the security and safety criteria is considered to be a safe and secure partner in the supply chain, which enhances the AEO’s reputation);
• mutual recognition (as a result of the WCO’s work in the past few years, it has become clear that mutual recognition of security and safety standards, and the implementation of comparable measures on a global scale, is essential in order to increase the security of international trade operations). Negotiations are under way with a number of non-EU countries (Switzerland, Japan, China, Norway and the US) on the mutual acceptance of security standards;
• benefits related to other tax types (the Hungarian government is planning to make further benefits available to AEO certificate holders in terms of various types of tax);
• transparency and tracking (e.g. reduced theft and losses, intra-company risks can be minimised);
• transportation and conveyance security (e.g. reduced crime and vandalism, fewer delayed shipments);
• better collaboration among supply chain parties (e.g. improved security and communication between supply chain partners, lower inspection costs of suppliers, and increased cooperation);
• the security of the whole supply chain (e.g. transport, storage, processing, sales, customs clearance, and use of goods) will increase;
• intra-company communication will become more effective (the AEO certificate establishes relationships with the organisational units involved in internal control within the company);
• economic operators with AEO status are included in a common EU database (which will be the basis for an EU-wide database of suppliers that follow best practices and are given priority);
• transparency and equal treatment for AEOs in all 27 EU Member States.

What is included in the EU AEO database?

The AEO database includes the certificate holder’s name, the date on which they obtained their AEO certificate, and the certificate type. The data will only be made available with the certificate holder’s consent.

The database allows searching and filtering by country, type of certificate, and name.

The AEO database is available at: http://ec.europa.eu/taxation_customs/dds/aeohome_en.htm

New AEO questionnaire

The European Commission has updated the AEO self-assessment questionnaire to take into account operational experience, and made it simpler and shorter than the old version. The accompanying explanatory notes have also been revised.

From 1 January 2011, only the new questionnaire is accepted.

The new version is available in the following languages:

• The old AEO questionnaire in Hungarian (for reference only)
• The new AEO questionnaire in Hungarian
• The new AEO questionnaire in English
• The new AEO questionnaire in German
• Explanatory notes in Hungarian (updated)
• Explanatory notes in English (updated)
• Explanatory notes in German (updated)

What services do we offer?

During the procedure for obtaining an AEO certificate, PwC undertakes to provide project support services in order to ensure that your certificate is granted as soon as possible. In addition, we will ensure that your employees can focus on your company’s daily activities and will not be distracted from work longer than necessary.

We collaborate with the customs bodies responsible for issuing AEO certificates so that we can answers specific questions that you may have at any stage of the application process.

We will also keep in contact with the customs authorities from the initial discussions until the AEO certificate is issued.

Our services in connection with obtaining an AEO certificate will be structured as follows:
 

 
We have experienced professionals in all AEO-related service areas:

• Dr. Tamás Lőcsei, Partner
• László Deák, Director
• Attila Környei, Senior Manager
• Andrea Major, Partner

Contact

If you have any questions or require our assistance regarding the above, please contact us.