5^th European Union - Canada - Joint Customs Cooperation Committee meeting

28 October 2022, by videoconference

Joint Report

The fifth meeting of the European Union (EU) – Canada Joint Customs Cooperation Committee (JCCC) meeting took place by videoconference on 28 October 2022. It was also the 2nd meeting of the JCCC as the specialized committee under the EU – Canada Comprehensive Economic and Trade Agreement (CETA).

The meeting was co-chaired on the EU side by Director-General Taxation and Customs Union (DG TAXUD), Gerassimos Thomas and on Canada’s side by the President of the Canada Border Services Agency (CBSA), Erin O’Gorman.

The meeting was positive, constructive and it resulted in the adoption of the JCCC Decision on the mutual recognition of the EU and Canadian trade partnership programmes, which marks an important milestone in the implementation of the Agreement between the EU and Canada on customs cooperation with respect to matters related to supply-chain security (SCSA). When implemented, this JCCC Decision will improve supply chain security and further facilitate bilateral trade between Canada and the EU.

1. Opening remarks and the adoption of the agenda

The agenda was agreed. In the opening remarks Canada and the EU stressed their close cooperation in the area of customs both bilaterally and multilaterally (in particular in the WCO concerning the WCO 2022-2025 Strategic Plan).

2. Future of customs

The EU and Canada exchanged their views on the challenges faced by customs in view of the exponential growth of e-commerce and number of low value shipments as well as of the growing number of non-fiscal tasks that customs have to perform on the border.

Canada presented its on-going work on customs pre-clearance, on Electronic Low Value Import System (ELVIS) and on legislative changes to the Customs Act introducing joint liability as a result of new importer of record rules.

In relation to addressing challenges posed by the exponential growth of low value shipments, the EU noted that in the EU the abolition of the VAT exemption that previously applied to imports of low value goods not exceeding €22 has lead to revenue growth and helped to combat fraud. The EU also briefly presented the currently on-going discussions on the EU customs reform including the report of the independent Wise Persons Group on the challenges facing the customs union. The EU explained that the main goal of the reform would be to bring the customs union to the next level to ensure that it is better equipped to respond to growing trade volumes, new trade models, technological developments, the green transition, the evolving geopolitical context, and security risks. The EU also noted that the reform is a work-in-progress involving not just the Commission, but also other EU institutions and EU Member States, so a more detailed presentation would be possible only at a later stage.

3. War in Ukraine: Sanctions implementation, focus on export controls and risk of circumvention

Both sides underlined the importance of the topic. The EU shared its experience on the customs role in the enforcement of the sanctions related to war in Ukraine including the fight against the risk of circumvention, the facilitation of humanitarian aid, the management of migration crises, the facilitation of trade flows with Ukraine through Solidarity Lanes, the support for Ukrainian customs, as well the as enhanced security and safety controls on the EU borders with Russia and Belarus. The EU highlighted the close coordination between the European Commission and EU Member States’ national customs authorities and the private sector. The EU mentioned that this work has largely relied on the use of existing databases and EU communication tools, including Surveillance, TARIC and the Customs Risk Management System (CRMS2) for risk management purposes. To illustrate this extensive work, the EU mentioned that more than 1500 Risk Information Forms had been uploaded into CRMS2 so far. The EU also emphasized the need to monitor not only imports, but also the exports of dual use goods.

Canada presented how the war in Ukraine and related sanctions have changed the way the CBSA works including a great number of additional tasks it has to perform in relation to monitoring exports of strategic goods, controlling activities linked to more than 1400 listed individuals and entities, enforcing shipping bans, etc. Canada underlined the importance of the work carried out by its National Targeting Center to identify risks and address them in a timely manner. Canada fully shared the view that it will be very important to support the Ukrainian customs to help them rebuild their capacity to fulfil their duties on the borders once the war is over.

4. Customs aspects of CETA – customs and trade facilitation, including legislative and regulatory update

The EU and Canada exchanged views that the overall state of the implementation of CETA provisions in the areas of customs and trade facilitation was good. Legislative and regulatory update by both sides was already partially covered under point 2 of the agenda, so under this agenda point the EU mentioned two longer term initiatives – the EU Single Window Environment for Customs and the Import Control System 2 (ICS2). The EU presented to Canada the ICS2, a pillar of an integrated EU approach to reinforce customs risk management framework, When discussing the ICS2 implementation timeline consisting of three releases, the EU outlined the consequences for each type of economic operators and modes of transport affected by each of these releases. The EU offered to provide to Canada further detailed information on the ICS2 and asked Canada, where possible, to further disseminate the relevant information to the Canadian economic operators involved in exports to the EU.

5. Customs aspects of CETA – origin (including quotas)

The EU and Canada exchanged views that the implementation of the preferential origin provisions under CETA was functioning well and that at the moment there were no specific issues in this area that needed to by addressed by the JCCC.

6. Mutual assistance in customs matters

On the occasion of the JCCC, the EU and Canada confirmed that they had exchanged the updated contact points for the implementation of mutual administrative assistance under the EU – Canada Agreement on Customs Cooperation and Mutual Assistance in Customs Matters (CMAA) and expressed a shared view that the implementation of the MAA provisions is functioning well.

7. Decision No 1/2022 of the European Union – Canada Joint Customs Cooperation Committee Concerning the Mutual Recognition of the Authorised Economic Operator Programme of the European Union and the Partners in Protection Programme of Canada

By mutual consent the JCCC adopted the Decision No 1/2022 of the European Union – Canada Joint Customs Cooperation Committee Concerning the Mutual Recognition of the Authorised Economic Operator Programme of the European Union and the Partners in Protection Programme of Canada. The above-mentioned JCCC Decision was signed in Brussels for the JCCC on behalf of the EU by Director-General Taxation and Customs Union (DG TAXUD), Gerassimos Thomas and on behalf of Canada by the Ambassador of Canada to the European Union, Ailish Johnson Campbell. The above-mentioned JCCC Decision is annexed to these minutes as Annex I.

The EU and Canada also discussed the next steps to prepare for the implementation of the above-mentioned JCCC Decision once it enters into force in line with the relevant provisions of the JCCC Decision. The EU and Canada agreed to use the IT specifications outlined by the EU in its Interface Control Document for the automatic exchange of information in accordance with Article 5 of the above-mentioned JCCC Decision. The EU and Canada agreed to accelerate the work on the IT solution, with the aim to start IT conformance testing in April-June quarter of 2023 and, pending successful testing, to start “live” exchange of information in accordance with Article 5 of the JCCC Decision No 1/2022 in July-September quarter of 2023. The EU and Canada agreed to further discuss the IT implementation issues in expert meetings between IT experts on both sides and to hold the next such meeting by videoconference before the end of November 2022.

8. Any other business and next steps

No other points to discuss were identified. Parties agreed to discuss in 2023 when the next meeting of the JCCC would take place.

Annex I: Decision No 1/2022 of the European Union – Canada Joint Customs Cooperation Committee Concerning the Mutual Recognition of the Authorised Economic Operator Programme of the European Union and the Partners in Protection Programme of Canada
NB. The text of the Decision will be available when the Decision enters into force.

Participants:

Canada: 
Co-Chair: Canada Border Services Agency, President
Canada Border Services Agency
Mission of Canada to the European Union

EU:
Co-Chair: European Commission, DG TAXUD, Director-General
European Commission services: DG TAXUD, DG TRADE, OLAF
Delegation of the European Union to Canada

EU Member States customs representatives: Austria, Czechia, Denmark, France, Ireland, Italy, Netherlands, Poland, Sweden, Slovakia