Ukraine introduces an authorised economic operator to reduce customs formalities

On 28 February 2019, the Ukrainian parliament approved in the first reading Draft Law No. 7473, which amends the Customs Code of Ukraine and introduces an authorised economic operator (AEO). The Amendments aim ultimately at improving customs formalities and gradually implementing the European Union Customs Code into Ukrainian legislation.

What are the advantages?

When granted by customs authorities, AEO status allows a Ukrainian company to enjoy simplified customs formalities. Once a resident entity obtains an AEO certificate, it can benefit, for instance, from the following advantages:

• a simplified customs declaration procedure;
• a shortened form of import declaration;
• given priority for customs formalities;
• permission to use a special traffic lane (commercial vehicles only) for crossing border, etc.

Main requirements

To obtain AEO status, an AEO candidate must demonstrate among other things that for three years prior to the application date:

• it has been a duly registered resident entity in Ukraine;
• the AEO candidate and its officials (including beneficial owners, substantive shareholders, supervisory board members) have not had criminal records in the sphere of commercial activity, including but not limited to smuggling;
• the AEO candidate, its officials or customs brokers have not committed repetitive or systematic violations of customs rules;
• the AEO candidate has been financially solvent, etc.

The Amendments are expected to be adopted in the second and final reading before parliamentary elections scheduled for 27 October 2019. If not passed by this date, the Amendments will have to be voted on again.

For more information on these Amendments and Ukrainian customs procedures, please contact one of our local CMS experts.

Legislation: Draft Law “On amendments to the Customs Code of Ukraine in relation to the implementation of Chapter 5 of Section IV of the Association Agreement between Ukraine, of the one part, and the European Union, the European Atomic Energy Community and their Member States, of the other part” No. 7473 dated 29 December 2017.