The procedure of obtaining a refund for customs duties paid in excess has been changed

It has been established that if an application to amend or supplement a goods declaration (application for the correction of a declaration) contains the information required under the relevant legislation of a member state of the Eurasian Economic Union (EAEU) for the return (offset) of customs and other duties paid and/or collected in excess, it will considered to be an application for a return if, under the member state's legislation, the return (offset) of customs and other duties paid and/or collected in excess takes place upon the payer’s application.

Such an application should be considered by the customs authority in accordance with the legislation of a member state within the established statutory timeframes, which may not exceed 30 calendar days from when such request was registered by the customs authority.

This regulation shall come into effect on 11 June 2017.

The impact of the changes

These changes are intended to make it easier for an applicant to have amounts returned of customs duties paid in excess.

Earlier, by virtue of the explanations set out in clause 29 of Resolution No. 18 of the Plenum of the Russian Supreme Court dated 12 May 2016, in order for customs duties paid in excess to be returned, the applicant had to initiate the corresponding amendment of the goods declaration at the same time as or before it filed the application for the return. In other words the applicant had to draw up two documents.

Regardless of the above explanations provided by the Plenum, the customs authorities mostly returned the application without considering it on its merits as, in their opinion, it is insufficient to file a request for amendments in order to confirm that the excess payments were made - for this, it is necessary for the customs authority to check the communication and make a decision in its regard. The deadline for such review was only limited to a three-year period for post-clearance customs control procedures.

This practice substantially drags out the return of funds by customs authorities. The procedure turned into a kind of formality, which had to take place before an applicant could file an appeal to the commercial court.

Now, under Resolution No. 46, for a return of funds paid in excess it is sufficient to file with the customs authorities a request to amend the customs declaration, which should be considered on its merits within a 30-day period.

What to think about and what to do

Article 90 of the Customs Union Customs Code specifies that amounts of import duties paid or collected in excess must be returned under the procedure established by the legislation of a Customs Union member state. Therefore, the Code delegates the powers to regulate this procedure only to national legislation. The Eurasian Economic Commission does not possess such powers.

In Russia the procedure for the return of amounts paid in excess is regulated by article 147 of Federal Law No. 311-FZ 'On customs regulation in the Russian Federation' dated 27 November 2010. In accordance with part 15 of the above article the amounts may be returned only based on an application for a return filed by the payer based on the form approved by the Russian Federal Customs Service.

Currently the relevant form of the application was approved by the Federal Customs Service’s Order No. 2520 dated 22 December 2010 and this does not provide for an application to correct the goods declaration to serve as the basis for a return of funds. Owing to this, before any changes are made to the above Order No. 2520, customs authorities may refuse on formal grounds to consider an application for the correction of a goods declaration in the capacity of a request for a return.

Moreover, the list varies of the documents to be enclosed with the application to amend the goods return and with the application for the return of excess amounts paid.

In order to avoid another formal reason for refusal it is recommended to enclose the documents required to review the application for a return with the applications for the correction of a goods declaration.

In practice, some customs authorities believe that one communication regarding a return state contain information regarding one goods declaration only.

However, as follows from the explanations provided by the Federal Customs Service, an application for a return of excess customs payments may contain an unlimited number of goods declarations. This allows the payer, in the event of a refusal to return the amounts under such application, to appeal it as a single court case which may not be divided into several cases. This substantially reduces legal costs.

Since customs authorities do not have a uniform approach to the application of the Procedure, companies may face a refusal to amend their goods declaration owing to the fact that more than one goods declaration is specified in the application. At the same time if one application is filed for each goods declaration, this may lead to the risk of the dispute being divided into several court cases.

Help from your adviser

Based on our practical experience in the area of customs law and foreign trade (including litigation), our lawyers are ready to provide legal assistance on customs fees paid in excess, as well as on other customs issues. 

With regard to a particular situation, we will help to develop a set of measures aimed at the return of customs fees paid in excess and at protecting the interests of a company if a customs authority refuses to return excess customs payments.