Customs, Excise duties, and Environmental taxes

Customs matters are a critical factor in effectively managing international trade operations, and their significance extends beyond mere operational considerations. Managing customs effectively is essential, especially given the intricate and ever-changing international landscape that governs the import and export of goods, as well as the pressing need to address sustainable development and digital requirements within the supply chain.

Our team comprises customs, excise, and environmental tax experts who can assist you in ensuring compliance with internal processes while navigating the dynamic and frequently evolving regulatory framework.

As part of the global PwC network, we offer integrated solutions that are creative, efficient, and cost-effective, aiming to minimize the impact of duties and taxes.

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Your challenges

Tariff Classification

Whether it's for imports or exports, the tariff classification assigned to goods plays a pivotal role in determining various factors such as customs duty rates, trade policy measures, security standards, and health or phytosanitary requirements. Accurate customs classification is essential, as non-compliance with regulations can result in significant civil and criminal penalties.

It is crucial for operators to handle tariff classification with the utmost care, and we can help you navigate this complex process.

  • Are you certain about the tariff classification of your goods?
  • Do you possess a comprehensive understanding of the rules governing tariff classification?
  • Do you conduct verification checks on the tariff classification provided by your customs representative or by your supplier?

Origin

Understanding and properly applying the rules of origin for goods can be a complex and diverse task for operators. It is crucial to comprehend these rules to benefit from tariff preferences offered under the free trade agreements established by the European Union. Origin is not only important for tariff advantages but also for labeling products as "made in" and complying with anti-dumping measures. The correct determination and utilization of goods' origin are significant factors that can be both advantageous, in terms of benefits obtained, and risky from a financial and reputational standpoint if mishandled.

  • Do you have a correct determination of the origin of your goods and are you taking advantage of the applicable free trade agreements?
  • Are you certain that your products qualify for the “Made in France” label?
  • Do you have the appropriate status to certify the tariff preferences of your goods (Registered Exporter (REX) or Approved Exporter (AE))?
  • Do you request origin declarations from suppliers in the European Union from whom you source your goods?

Customs Valuation

Custom valuation, which serves as the taxable basis for calculating import duties and taxes in most cases, can be highly complex to determine, considering the transaction’s circumstances and any elements that may need to be included or excluded from the price charged by the foreign seller.

  • Is the value of your imported goods declared accurately? Have you considered the influence of your transfer pricing policy on the customs value?
  • Are you certain that you are declaring a customs value in line with the market price practices when importing duty-free goods (such as samples, prototypes, etc.)?
  • Do any additional elements need to be included or excluded in the declared customs value upon importation?

Special Procedures

Special customs procedures offer the opportunity to import third-country goods into the European Union with the suspension of customs duties, value-added tax (VAT), and trade policy measures.

These procedures are designed to facilitate operations such as stockage, processing, or specific use, providing potential financial gains as well as logistical advantages.

  • Are you familiar with the different existing special customs procedures available and the benefits they offer?
  • Have you determined which customs procedures are best suited for your specific flows and business activities?
  • Are the customs procedures implemented by your company in compliance with French and European Legislation?

Export Control and Sanctions

Certain products qualified as strategic or posing particular risks are subject to specific formalities when exported. These can include weapons, military equipment, and dual-use goods with both civilian and military applications. Additionally, countries may impose sanctions to counter aggressive actions. These measures are complex and involve both economic sanctions (import and export prohibition, restrictions for certain services and contracts, etc.) and individual sanctions (travel prohibition and asset freezing).

Non-compliance with these regulations can result in severe penalties. It is crucial to have a comprehensive understanding of the applicable regulations.

  • Do you conduct specific screening of your business partners to ensure compliance with export regulations?
  • Are you legally permitted to maintain business relationships with partners based in sanctioned countries?
  • What are the specific regulations governing the import and export of the goods you deal with? Do you have the necessary authorizations to import or export them? 

Authorized Economic Operator (AEO)

The Authorized Economic Operator (AEO) authorization is a trusted label granted by Customs administrations to operators who demonstrate a thorough understanding of customs regulations, effective flow management and a sufficient security level of the supply chain. Becoming an AEO offers several benefits to companies, including:

  1. Competitive advantage, as it may be a requirement for participating in certain tenders or business opportunities.
  2. Procedural and administrative facilitation.
  3. Obtaining AEO status serves as a valuable business project, prompting a comprehensive review of customs operations management and the opportunity to enhance procedures.

Furthermore, the European Union has signed mutual recognition agreements with partner countries (such as the US, China, etc.) providing for equivalent advantages.

  • Have you anticipated requests from your foreign partners demanding an AEO label or equivalent status for participation in tenders?
  • Would you like to benefit from the advantages currently granted to AEO operators and enhance your international trade operations? 

Environmental Taxes

Environmental taxation has emerged as a prominent challenge in recent years, driven by the rapidly evolving societal expectations. Political initiatives aimed at promoting environmental sustainability have proliferated, placing greater emphasis on the role of economic actors in mitigating environmental impacts.

This primarily concerns energy excise duties levied on the sale or use of certain products (formerly known as Domestic Consumption Tax on Energy Products (TICPE), Domestic Consumption Tax on Electricity Supply (TICFE), Domestic Consumption Tax on Natural Gas (TICGN), and Domestic Consumption tax on coal (TICC). It is important, however, to note that environmental taxation also encompasses various mechanisms related to natural resource protection, pollution control, and carbon emissions.

  • Are you in compliance with the obligations related to green taxes that impact your business?
  • Have you conducted a review of the management of your operations subject to energy excise duties?
  • Do you meet the conditions to benefit from reduced excise rates?
  • Have you assessed the possibility of applying for excise duty refunds?
  • Have you anticipated the impact of the Carbon Border Adjustment Mechanism (CBAM)? 

Eco-contributions (Extended Producer Responsibility - EPR)

In accordance with the polluter-pays principle, the concept of “Extended Producer Responsibility” (EPR) provides that product manufacturers and distributors can be held responsible for managing waste throughout the life cycle of a product. The implementation of an EPR system involves the transfer of responsibility, costs, and waste management to the “producers.”

Today, EPR takes the form of various eco-contributions for different products categories, including electrical and electronic equipment, packaging, paper, textiles, furniture, tires, tobacco products, toys, mineral oils, etc. These eco-contributions represent a significant compliance challenge for businesses, both in terms of potential penalties and reputational impact.

  • Have you assessed the issues related to Extended Producer Responsibility (EPR)?
  • Are your products subject to one or more eco-contributions?
  • Have you addressed the declarative aspects related to your business activities?
  • Have you considered the impact of eco-contribution regulations in relation to your ESG obligations? 

Excise duties on alcohol and tobacco

Alcohol and tobacco products are subject to a unique regulatory framework that imposes complex financial and administrative obligations on businesses. This includes obtaining specific authorizations tailored to the nature of transactions involved. Additionally, stringent obligations are in place to ensure the traceability of products subject to excise duties. It is crucial for operators to achieve full compliance with these regulations to avoid potential civil and criminal penalties.

  • Do you have the necessary authorizations to carry out your activities?
  • Have you explored the possibility of applying for a refund?
  • Have you conducted a review of your processes, including the management of stock accounts?  

How can we help?

  • Mapping of flows and review of your customs operations management.
  • Support in the application for Authorized Economic Operators (AEO) status and preparation for renewal audits.
  • Study on the impact and anticipation of obligations regarding export control regulations.
  • Review of the supply chain to incorporate specific requirements for flow traceability.
  • Obtaining authorizations to minimize the financial impact of your operations.
  • Accountability analysis and declarative assistance for environmental taxes and eco-contributions.
  • Support in control and litigation matters.
  • Regulatory Watch

Our Added Value

A department recognized in rankings

An international network that is leading and interconnected

A robust methodology for tailored support with innovative solutions

Possible integration with various PwC capabilities (Tax, Social, Accounting, Finance, etc.)

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José  Manuel Moreno

José Manuel Moreno

TVA & Indirect Tax Lawyer, Partner, PwC Société d'Avocats

Tel: +33 6 08 88 87 11

Luana Higino Balbino

Luana Higino Balbino

Customs Director, PwC Société d'Avocats

Tel: +33 7 62 15 25 01

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