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Attention All Economic Operators The Use of Procedure Codes 42 and 63

The Customs Department would like to inform all Economic Operators that new instructions for the collection of VAT when procedure codes 42 and 63 are used will enter into force as from 1st January 2020.

The European Commission introduced new instructions for the collection of VAT when procedure codes 42 or 63 are used, to cover the new legal provisions for VAT collection (Council Regulation (EU) No 2018/1541).   The VAT Number of the economic operator in another member state would be required.  This concerns imports followed by an intra-Community supply of the goods to another Member State where VAT is not paid upon importation but will be due in the member state of destination.  Consequently, in order to use procedure codes 42/63, the declarant must provide information about the economic operator of the other Member State.

When the import is followed by an intra-Community supply of the goods to another Member State, no VAT is paid upon importation and VAT will be due in the Member State of final destination. In order to use this procedure, the declarant has to provide information about the importer or tax representative and the customer in the other Member State in the ‘Additional Information’ of the import declaration.

Role

Code

Description

Customer

FR2

For the declaration of the customer in the Member State of destination the code FR2 followed by the VAT number of the customer in the Member State of destination has to be used.

 

Importer

FR1

For the declaration of the importer, the code FR1 followed by the VAT number of the importer has to be used. Where the importer is represented by a tax representative in the Member State where the customs declaration is lodged the code FR3 followed by the VAT number of the tax representative is used. The declaration of the importer and the tax representative are exclusive. This means that the tax representative has only to be declared where the importer is actually represented and in this case the importer cannot be declared.

Tax Representative

FR3

Customer (FR2) and the respective VAT number is to be declared in all items of the declaration bearing having procedure codes 42/63 together with, either the Importer (FR1) or the Tax Representative (FR3)

Each of these parties (importer, customer and tax representative) can be declared only once per goods item of the import declaration. If parts of the consignment are destined to different customers in other Member States, they should be declared under different goods items.

To indicate the evidence that the imported goods are intended to be transported or dispatched from the Member State of importation to another Member State, TARIC certificate Y044 must  be provided in box 44 – ‘Produced Documents/Certificate’s in the customs electronic system (NIES), followed by the reference number of the transport contract (eg: CMR /Bill of lading/Airway bill number)

An authorisation from the Customs Special Procedures Unit is solicited when procedure codes 42/63 apply.

For additional clarification, you are kindly being requested to contact the Customer Services Unit on Tel: 25685121 or send an email to: customercare.customs@gov.mt.