§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer what investigations have been made by(a) his Department and (b) the EEC Commission of the origin of fish products and prawns or shrimps imported into this country on EURI certificates from (i) Iceland, (ii) Norway and (iii) the Faroe Islands; how many staff were involved and for what period of time; and what information about consignments was made available to them. [37954]
§ Mr. Heathcoat-AmoryNo investigations have been made in Iceland, Norway or the Faroe Islands by Customs an Excise. The EC Commission has sent mission teams to all three countries. No information is available as to the precise duration of the inquiries or the number of staff involved.
A team visited Iceland on several occasions from July 1992 to early 1993, in connection with exports of prawns. They were able to examine processing plant records, which identified the source of raw materials through to consignments of finished product. In 1995 another team visited Iceland to look at cod. The result of their inquiries are still being evaluated.
A team visited Norway to make inquiries about cod. These inquiries were subsequently pursued by the Norwegian customs authorities who reported their conclusions to the EC Commission in January and March 1995.
The mission to the Faroe Islands took place in 1991. Processing plant and export consignment records were examined.
§ Mr. MitchellTo ask the Chancellor of the Exchequer how many retrospective claims against how many firms, for what total sums of money and for what period are being made by his Department against importers of prawns or shrimps in respect of(a) Iceland, (b) Norway and (c) the Faroe Islands and at whose behest. [37946]
§ Mr. Heathcoat-AmoryThe information requested is as follows: 525W
Number of claims Number of firms Total (£) Period a-i) Iceland (mission) 15 12 435,000 October 1990 to August 1992 a-ii) Iceland (disclosure) 11 9 23,000 1993 c) Faroes (mission) 13 13 1,900,000 May 1989 to October 1991 a-i) and c) were the result of EC missions, while a-ii) was a disclosure by Icelandic customs in respect of one of their exporters.
No claims have been made against importers in respect of Norway.
§ Mr. MitchellTo ask the Chancellor of the Exchequer what proposals he has made to the EEC Commission for compensation for British importers of prawns or shrimps innocently imported from(a) Iceland, (b) Norway and (c) the Faroe Islands on EUR1 certificates now considered by the European Commission to be invalid, what scale of compensation has been proposed; when it will be payable; and what response has been forthcoming from the Commission. [37955]
§ Mr. Heathcoat-AmoryNo such proposals have been made because duty recovery has been suspended pending completion of the legal process. Therefore, compensation is not appropriate in the circumstances. The Commission and member states are being urged to produce a lasting solution which properly balances safeguarding the Community budget and the interests of European business. Such a solution will need to address the future as well as the past.
§ Mr. MitchellTo ask the Chancellor of the Exchequer what advice was and is now given by his Department to importers of fish products from(a) Iceland, (b) Norway and (c) the Faroe Islands coming in duty free under EUR1 certificates about their liability if the certificates issued in the country of origin prove to be invalid, about how they can safeguard themselves against such retrospective charges and about how they can test the validity of EUR1 certificates. [37948]
§ Mr. Heathcoat-AmoryAdvice is set out in Customs notice No. 826. This recognises the difficulties that importers may experience in trying to establish whether a certificate is valid or whether goods shown on it are eligible for preferential tariff treatment. For very many years the notice has warned of the potential further duty liability and since July 1990 has advised importers to consider the advantages of including a clause in contracts allowing them to recover any duty charge from the supplier. In addition, Customs have regularly contributed articles for trade journals and participated in trade seminars and the consequences of invalid documentation has been covered on each occasion.
§ , Mr. MitchellTo ask the Chancellor of the Exchequer whether, in levying retrospective duty on prawns or shrimps imported from(a) Iceland, (b) Norway and (c) the Faroe Islands with valid EUR1 certificates, he makes any allowance for the fact that a proportion of those prawn/shrimps will in fact have been caught in that country; what proportion he estimates this to be; and whether this is estimated as being constant or can be specifically assessed for each consignment. [37952]
§ Mr. Heathcoat-AmoryThe mission to Iceland found that most processing plants kept sophisticated records which identified the source of raw materials through to consignments of finished product. Duty demands were526W issued only for consignments where there was a clear audit trail from the non-originating prawns through to deliveries to specific companies in the EC. Where part of a consignment qualified, typical because it comprised prawns of different sizes and origin, then the duty demand was restricted to the non-originating element.
No duty demands have been issued for prawns or shrimps imported from Norway.
§ Mr. MitchellTo ask the Chancellor of the Exchequer whether he will publish the evidence provided to him by the European Commission that prawns or shrimps imported from(a) Iceland, (b) Norway and (c) the Faroe Islands in fact originated elsewhere; and indicate what proportion of the imports from the Faroe Islands this applied to. [37947]
§ Mr. Heathcoat-AmoryEC mission team reports, which contain sensitive commercial information, are protected by EC agreements which restrict their issue or publication.
The proportion of imports from the Faroe Islands established as non-originating was 66 per cent. for 1989, 81 per cent. for 1990 and 53 per cent. for 1991.
§ Mr. MitchellTo ask the Chancellor of the Exchequer, what representations he has made to his customs counterpart in(a) Iceland, (b) Norway and (c) the Faroe Islands about their acceptance of EUR1 certificates for the export of fish products to Britain which subsequently proved to have originated elsewhere than in Iceland; what compensation he has requested from them for British importers trusting these certificates; and what procedures his Department has put in place to check the validity of EUR1 certificates for Iceland. [37951]
§ Mr. Heathcoat-AmoryNo such representations have been made to third country customs authorities.
The UK has, however, made strong representations concerning these difficulties at recent EC meetings and gained considerable support from other member states. A number of different proposals have been put forward to alleviate the burdens on importers and these now have to be considered carefully. It will be for the European Commission to write to third country authorities if this is considered appropriate.
In accordance with normal practice, EUR1 certificates are from time to time returned to exporting countries for verification by their customs authorities.
§ Mr. MitchellTo ask the Chancellor of the Exchequer if he will give the outcome of all court cases pursued by his Department against importers of prawns or shrimps from(a) Iceland, (b) Norway and (c) the Faroe Islands on the basis of EUR1 certificates now considered by him to be invalid; what costs have been awarded and to whom; how much retrospective duty has actually been paid; and by how many firms. [37956]
527W
§ Mr. Heathcoat-AmoryTwo of the companies who received duty demands in respect of imports from the Faroe Islands submitted an application for a judicial review on the grounds that the demands were incorrect in law. The High Court referred a number of questions to the European Court of Justice and awarded costs against Customs. No reason was given for the award and Customs are still in correspondence on the matter. The judgment of the European Court of Justice is expected by early December.
There have been no other relevant court cases, although several importers have appealed to the VAT and duties tribunal. These cases are being stood over by the tribunal pending the European Court of Justice judgment. Payment of duty will not be pursued until the legal process is completed.
§ Mr. MitchellTo ask the Chancellor of the Exchequer how many claims for duty have been made in each year since 1980 for duty not paid on fish products imported from(a) Iceland, (b) Norway and (c) the Faroe Islands on EUR1 certificates which subsequently proved to be invalid. [37949]
§ Mr. Heathcoat-AmoryThe information requested is as follows:
1992 1993 1994 1995 Iceland — 12 — 9 Norway — — —> 2 Faroe Islands 13 — — — Figures are not available for imports of fish products prior to 1992.
§ Mr. MitchellTo ask the Chancellor of the Exchequer what burden of proof about the origin of fish products imported on EUR1 certificates falls on(a) his Department (b) the British importer, (c) the customs of the originating country and (d) the exporter issuing the EUR1 certificate where such certificates are deemed by his Department to be invalid; on what basis such retrospective claims are made by his Department; and what time limitations apply. [37953]
§ Mr. Heathcoat-AmoryThe responsibilities of the various parties are set out in the preferential trade agreements between the European Community and Iceland, Norway and the Faroe islands. The prime responsibility for determining whether particular goods qualify for preferential status lies with the exporter. Where it is not possible to determine the origin of goods, or where they are non-originating—that is, they do not come originally from the exporter's country—an EUR1 certificate is inappropriate.
The responsibility for accounting for any import duties due falls on the importer in the country of destination.
The customs authorities in the country of importation are responsible for collecting any duties due, including duties charged retrospectively where EUR1s are found to be invalid.
The customs authorities in the country of export are responsible for issuing EUR1s verifying any certificates returned by foreign import authorities and considering sanctions against exporters who abuse the system.
528WCustoms and Excise have issued retrospective duty demands only where either the customs authorities for the exporter have advised that certificates were invalid or where an EC mission has provided firm evidence that goods did not meet the rules of origin.
The time limitation for retrospective duty demands is three years from importation.
§ Mr. MitchellTo ask the Chancellor of the Exchequer what instructions he has had from the European Commission about retrospective duty on prawns or shrimps imported from(a) Iceland, (b) Norway and (c) the Faroe Islands on EUR1 certificates; how much he has been required to recover; to whom this is payable; what information he has about the levy of such duties in each fish importing member of the EU; and what representations he has made to the Commission about such changes. [37950]
§ Mr. Heathcoat-AmoryNo specific instructions have been received from the European Commission about retrospective duty on prawns or shrimps. However, where checks on EUR1s show that the goods were not entitled to relief, duty at the full rate becomes payable under the terms of the preferential trade agreement with the country concerned, which in the community are implemented in EC law. Customs duty is collected by member states and remitted to the Community as own resources.
In the case of retrospective duty demand on prawns from Iceland, Customs and Excise are aware that duty recovery action has also been taken by Denmark and Germany, the only other countries with a major interest.
Customs have made strong representations at recent EC meetings about the problems associated with duty recovery in respect of invalid documentation, including EUR1s, and have gained considerable support from other member states. Over the next few weeks, Customs will continue to press for urgent attention to be given to this issue with a view to reaching consensus among member states on the best solution.