Authorised Economic Operator AEOWhat is AEO?

The EU has introduced a new accreditation system for supply chain managers and users. It’s aimed at achieving a competency level known as an Authorised Economic Operator or AEO. The threat of terrorism, trafficking and fraud has meant that countries and trading blocks are developing counter measures to ensure that supply chains are secure and that they remain so. The AEO regime, has been introduced to enhance security controls so that the EU internal market and the international supply chain is protected. This issue affects every business, irrespective of its size or trade sector, that owns or move goods through the international supply chain.

AEO status is awarded to economic operators, meeting certain criteria, who are seen as reliable and compliant by the customs authorities. The AEO mark of credibility has to be earned by a business but once acquired it can improve corporate governance, reputation and competitive advantage. Once you’ve attained this accreditation you’ll be able to see who else that you deal with has the same. The EU AEO database allows anyone to check who holds an AEO status, what type it is and the date and country of issue.

 

Getting AEO Status

Don’t worry, it’s not compulsory – but it does have benefits for you if you want to get on board.

The main benefit is that it gives quicker access to simpler customs procedures and, in some cases, the ability to ‘fast-track’ your shipments through customs and associated safety and security procedures.

What that means is that you can apply for an AEO status that suits your needs.

  • AEO status for customs simplification (AEOC)
  • AEO status for security and safety (AEOS)
  • Or both!

 

AEOC Status

If you hold AEOC status, you could benefit from the following.

  • You can use a faster application process for customs simplifications and authorisations.
  • You can get reductions or waivers of comprehensive guarantees.

For certain things that you want to do you will need to be a holder of an AEOC. These include:

  • moving goods in temporary storage between different member states
  • to use a notification waiver when making an entry in a declarant’s records (EIDR)
  • to get a 70% reduction in a business’s deferment account guarantee
  • undertaking centralised clearance (when available)
  • completing self-assessment (when implemented)

 

AEOS Status

You’ll need to be a holder of an AEOS if you’d like to benefit from arrangements under mutual recognition agreements with third countries. AEO status is for businesses that are established in the EU, actively involved in customs operations and international trade, and have an Economic Operator Registration and Identification (EORI) number.

 

Union Customs Code (UCC)

Customs legislation will change on 1 May 2016 with the implementation of the UCC. The UCC introduces a new standard of professional qualification related to customs activities. Training that provides recognised customs qualifications is limited in the UK, so in order to get this competency level you will have to demonstrate that you have carried out your customs processes to a high standard over the previous 3 years. This standard only applies to AEOC and not to AEOS.

There’s a transitional period for AEO authorisations issued before 1 May 2016. This period will go to 1 May 2019, when all AEOs must meet the new requirements. The reassessment work will be managed over this 3-year period and AEOs will be given more information on how and when this will be done.

 

Want to Know More?

For more information on getting AEO status, see this official publication from HMRC.

Do you have any questions? Feel free to contact us at sales@agrdynamics.com and we will help you in any way that we can!

Content provided by Melissa Cupis and Tim Lux Pathfinders