Agenda

NEW TOOLS FOR HARMONIZING UKRAINIAN CUSTOMS DISPUTE LEGISLATION WITH EU REGULATIONS

19/03/2025

 

The new concept of post-clearance control will come into force in April alongside Law No. 3926-IX: “On Amendments to the Customs Code of Ukraine on the Implementation of Certain Provisions of the EU Customs Code”. This reform aligns with the Post-Clearance Audit (PCA) Guidelines developed by the World Customs Organisation.

Basics of the Concept

  • pre-inspection analysis may be initiated based on data from various sources, including customs authorities’ information resources, automated management systems, external data exchanges, and written requests.
  • strengthening post-clearance controls is expected to reduce the level of checks at the customs clearance stage.
  • extended post-clearance review period – previously limited to 30 days from the date of goods release, this period has now been expanded to five years.

Types of the Requests from Custom Authorities During Pre-Inspection

Customs authorities may request information regarding:

  • customs value, classification, and country of origin;
  • CBT declarations issued since 2020;
  • if declarations were submitted by customs brokers rather than the company itself, additional documents from manufacturers and suppliers may be required. This can create significant challenges if companies no longer collaborate with these suppliers, potentially leading to reclassification, customs value adjustments, and unscheduled inspections;
  • if discrepancies are identified during pre-inspection, customs authorities may initiate a documentary audit and notify other relevant authorities, such as tax regulators.

Findings from post-clearance audits will influence:

  • the Automated Customs System (ACS) in determining the form and extent of customs controls;
  • future customs clearance procedures;
  • compliance monitoring activities.

A Tax Notification Decision (TND) may be cancelled due to:

  • procedural errors;
  • lack of reasonable grounds for the audit;
  • failure to properly notify the audited party;
  • breach of legal procedures in initiating or conducting the audit.

Additionally, a customs inspection may be overturned if it fails to prove the submission of false documents in cases involving incorrect determination of customs value or classification codes (UKT ZED).

Main Reasons for Customs Value Adjustment

Customs authorities may challenge declared customs values based on:

  • discrepancies in documents (e.g. mismatches between invoices and departure country declarations);
  • failure to provide requested documents (e.g. bank statements, insurance certificates);
  • incomplete documentation (e.g. missing delivery terms);
  • business relationships between the buyer and seller;
  • non-inclusion of licence fees in customs valuation;
  • missing or unverified insurance details;
  • failure to account for freight forwarder’s fees within Ukraine;
  • incorrect allocation of transportation costs before and after crossing the border;
  • unreasonable and unspecified request for documents;
  • unreasonable decisions;
  • failure to provide a reasonable refusal to recognise the declared customs value of the goods within the established time limits - SC Resolution of 03.07.2024 in case No. 826/3763/18.

Classification decisions

Since 2023, customs classification decisions—including those on binding tariff information—must align with EU classification laws (EU acquis). The State Customs Service publishes the list of relevant legislative acts, however, inconsistencies between Ukrainian customs classifications and EU acquis provide strong grounds for successful legal challenges.

Key Grounds for Cancellation of Classification Decisions:

  • failure to apply the Basic Rules of Interpretation of the UKTZED – prioritising a more specific classification description (e.g. Supreme Court Rulings No. 1940/1470/18 (11.12.2024), No. 826/3775/17 (30.04.2024));
  • breach of procedural safeguards in sampling and testing goods (e.g. Case No. 160/31313/23, 07.11.2024);
  • failure to notify declarants about the requirement for classification documents, violating due process (e.g. Case No. 320/8344/24, 22.01.2025);
  • unsubstantiated classification code changes, including the absence of expert assessments.

Violation of Customs Rules and the Role of Court

Most court cases regarding customs violations involve non-declaration of goods, concealment of goods from customs control or unlawful exemption from customs duties. These cases typically fall under Articles 472, 483, and 485 of the Customs Code of Ukraine.

Conclusion

Businesses are facing increased regulatory scrutiny with the expansion of post-clearance controls, new customs monitoring tools, and the criminalisation of smuggling. However, these changes also offer new opportunities to challenge customs decisions effectively.

 

NAZALI TAX & LEGAL

info@nazali.com

This document provides general information on the subject and does not constitute a legal opinion or recommendation. Consulting a specialist is recommended before taking an action. No claim arising from the content of or relating to this document can be asserted against NAZALI.