Customs clearance in the Czech Republic

1. Legal regulations

The Czech Republic, as an EU Member State, is part of a common customs territory, and customs clearance procedures adhere to the following principles valid for all EU Member States:

  1. Uniform customs regulations issued in the EU are valid, in particular: Council Regulation (EEC) No. 2913/92 – the Community Customs Code; Council Regulation (EEC) No. 2454/93 – provisions for implementation of the Community Customs Code; and Council Regulation (EEC) No. 918/83 – provision for setting up a Community system of relief of customs duty.
  2. Imports and exports are categorized, and import duties determined, using a common customs tariff.
  3. The customs policy applied to third countries is common to all EU Member States.
  4. Goods with Community status delivered between EU Member States are not subject to customs clearance.

Some areas of customs clearance that fall under the jurisdiction of each EU Member State (such as the methods used to secure customs duty liability and breach of customs regulations) are regulated by Act No. 13/1993 Coll., the Czech Customs Act, as amended.

2. Customs policies

The common customs policy of the EU ensures that preferential customs tariffs are applied, under certain conditions, to imports from contractual states or groups of states. Preferential customs policies apply to products from preferred countries upon presentation of the certificate of original, the form of which is determined by the individual agreements. No EU Member State can thus apply any restrictions or prohibitions to third countries other than those stipulated by EU regulations.

3. Customs value

The customs value of imported goods is determined according to World Customs Organization (WCO) principles as the price that has been or should have been paid out for goods sold for export to the EU customs zone converted to Czech crowns. If secondary costs – such as freight, insurance or licence fees – are not included in the price, they must be added to the price paid for the goods.

If the customs value cannot be determined according to the above principles, it is determined as the value of the same or similar goods sold for export to the Community at the same or almost the same time.

4. Customs and VAT upon import

Customs duty is classified according to the method used to determine it, i.e., as:

  1. ad valorem – determined as a percentage of the customs value
  2. specific – determined as a fixed amount for a certain amount of goods (e.g., per piece, per kg)
  3. combined – both of the above methods applied together

The assessed customs duty liability must be secure or paid. If it is secured, it is due within 10 days of the date of delivery of the decision on its assessment. When the goods are released into one of the economic customs regimes, the customs authorities can demand security of up to 10% of the customs duty liability that could arise.

Value added tax is not collected when goods are imported, but the taxpayer declares it in the relevant tax return and can, at the same time, exercise his right to claim a VAT refund, provided, however, that certain conditions stipulated by the law are met (such as the ability to present the joint customs declaration - SAD).

5. Customs regimes

The customs regime determines the status of the goods under customs supervision. The basic customs regimes are: release into free circulation, transit, and export.

In addition to the above, it is possible, under certain conditions and after obtaining prior written permission from the customs authorities, to release goods into one of the economic customs regimes: customs warehouse, outward processing, processing under customs control, temporary importation, inward processing.

6. Simplified customs clearance procedures

To ensure a smooth flow of goods and a reduction of administrative costs, it is possible to ask the relevant customs authorities to allow simplified customs clearance, or to do so when confirming the origin of the goods. The most advantageous form of simplified clearance is the so-called local clearance procedure. This method makes it possible, upon import for example, for goods to be delivered directly to the importer, who then records them into a specified file. If the customs authorities do not require a hands-on check of the goods, the goods are deemed to have been released into free circulation or into some other customs regime. The single administrative document (SAD) is presented to the customs authorities subsequently.

The request for allowing simplified customs clearance can be made by a person who can guarantee that the procedure will be carried out properly and under conditions that allow the customs authorities to perform inspections.

7. Electronic customs procedures

The electronic customs clearance procedure implemented by the Customs Administration of the Czech Republic is fully compatible with electronic programmes designed for communication with parties to customs clearance procedures. At this time, electronic filing of customs declarations is required for releasing goods into the Community transit regime (the exception being hard-copy customs declarations filed while in travelling and in the event of emergencies). Furthermore, for customs clearance on exports, the Export Control System (ECS) is used to facilitate electronic exchange of information within the EU. Other customs regimes will be implemented in electronic communication projects gradually.

A new project within the EU is the Centralized Customs Control (CCC), which breaks the rule that customs declarations are filed to the customs office to whom the goods are submitted. This thus makes it possible in practice for documents to be submitted to one customs office and any hands-on inspections to be performed by another customs office.

8. AEO certification

Effective 1 January 2008, the new AEO (authorised economic operator) status has been implemented in the EU. A company domiciled in the EU can acquire AEO status after submitting the required documents to its domestic customs administration. This status facilitates communication with customs administrations of other EU Member States. The AEO status can be provided either to simplify customs clearance, thus allowing the company to apply for the status of approved dispatcher, for exemption from the obligation to secure customs duty liability etc., or to certify that the company possesses the appropriate security parameters, which can then be used to document the company’s credibility, or to do both.

The benefit of an AEO certification is a reduction in the amount of data required to be submitted during customs clearance procedures, a reduction in the number of hands-on inspections, and the status of a credible partner in business transactions, not only in the EU but in third countries as well.

9. Representation in customs clearance procedures

Any person can arrange to be represented during customs clearance procedures. According to Czech law, the customs clearance representative can only be a Czech person.

The representation can be:

  • direct, with the representative acting in the name and in favour of the person being represented
  • indirect, with the representative acting in his own name but in favour of the person being represented

The representative must present the respective power of attorney to the customs authorities.
 

Hana Krausová
Daňové a právní služby
PricewaterhouseCoopers