The new Customs Law, “Off. Gazette RS”, no. 95/2018 (Law) was adopted at the session of the National Assembly of the Republic of Serbia held on December 07, 2018. The new law has come into legal force on December 16, 2018, but will only be applicable after expiration of a 6-month period as of its entry into force, i.e. as of June 17, 2019. The Law envisages significant changes with respect to certain legislative solutions, primarily with the aim of harmonization of customs regulations with the new Customs Code of the European Union.

The key amendments of the new Law:

  • extension of total period within which goods can be placed under the temporary import procedure to 10 years;
  • extension of criteria for obtaining the status of Authorized Economic Operator (AEO);
  • new division of customs procedures on: 1) release of goods for free circulation; 2) special procedures and 3) export;
  • exchange of information (including submission of customs declarations) between customs offices and businesses, as well as storage of those, which should be completely done electronically;
  • the obligation to apply the binding tariff classification of goods and binding origin classification of goods not only for the customs authorities in relation to the person to whom they are issued, but also for such person in relation to the customs authorities; the Law also introduced the possibility of issuing such binding decisions regarding elements on the basis of which import or export duties and other measures related to trade in goods are applied;
  • the document by means of which a non-preferential origin of goods is evidenced – a possibility was introduced that the non-preferential origin of goods may be  confirmed with a document issued in the Republic of Serbia in accordance with the rules of origin in force in the country or in the territory of the destination, or by any other means that identifies the country or territory in which the goods were fully obtained or in which the last significant change has been made;
  • security (collateral) for collection of customs debt – an obligation to provide mandatory security has been envisaged for coverage of potential and actual customs debts for the majority of customs procedures;
  • inward processing can now be approved without the obligation to re-export the goods (unless if otherwise explicitly stipulated);
  • distance (retail) sales from customs warehouse is now possible;
  • extension of period within which goods can be placed under temporary storage to 90 days;
  • introduction of simplifications relating to centralized customs clearance and self-assessment;
  • customs valuation of goods – the rule of first sale shall not apply as the main rule for customs valuation purposes when the goods are sold and re-sold several times prior to importation.

This is the short overview of some of the above-mentioned amendments that have been introduced in the new Law.

1. Extension of criteria for obtaining the status of Authorized Economic Operator (AEO)
Article 28 of the new Law clarifies conditions that need to be met for obtaining the status of AEO in the following way:

- it has been clarified that the condition relating to abiding by customs regulations assumes absence of whichever serious violation or repetitive violations of customs and tax regulations, including absence of criminal acts relating to economic activity of the applicant,   

-  it has been clarified that the condition which enables performing appropriate customs control assumes possession of high level of control of activity and flow of goods by the applicant, through keeping appropriate business records, and where necessary, records on transport of goods,

-  financial liquidity shall be considered proven if the applicant is in good financial condition which enables fulfillment of obligations, considering its business activities.

Finally, it has been clarified that obtaining the status of AEO for customs simplifications assumes abiding by the practical standards of professionalism or professional qualifications which are in direct relationship with the activity that is being conducted. Also, it has been clarified that obtaining the status of AEO for safety and security assumes fulfillment of appropriate safety and security standards, which are considered to be met if the applicant can prove that it undertakes appropriate measures to ensure safety and security of international chain of supply, including physical integrity and access control of its business area, logistic processes and handling certain types of goods, check of personnel and identification of its business partners.

2. New division of customs procedures
The new Law envisages new division of customs procedures on: 1) release of goods for free circulation; 2) special procedures and 3) export.

Within the new set of procedures, the differentiation should exist between:

1.    transit procedures, which encompass external and internal transit;

2.    storage procedures, which encompass customs warehouses and free zones;

3.    special use procedures, which encompass temporary import and special purpose use;

4.    processing procedures, which encompass inward and outward processing;

In other words, the procedures of processing under customs supervision and inward processing with refund of import duties have been removed from the Law, while the placement of goods in free zones has become a special customs procedure.  

3. Electronic exchange of information
With the application of the new Law all exchange, as well as storage of information, such as customs declarations, requests or decisions, between customs offices and between customs offices and businesses should be done by means of systems for electronic information processing, that is, electronically. In other words, doing business will become paperless, which, among other things, assumes withdrawal form submission of paper declarations.  

The new Law, at the same time, envisages possibility for the use of other means for exchange and storage of information, except for the systems for electronic information processing, if such electronic systems are not operative yet. Additionally, it also provides for the possibility to use other systems for exchange and storage of information, except for the systems for electronic information processing, in special cases when that is justified by the type of transport used or when electronic information processing is not appropriate for the given customs formalities.

In both cases, the new Law fixes the authority to the Government of the Republic of Serbia to regulate the mentioned cases in more detail.

It is expected that this change should result in development of new and upgrade of existing information systems that companies in the Republic of Serbia are already using.

4. Security (collateral) for collection of customs debt
The new Law prescribes mandatory collateral for coverage of potential and actual customs debts in the manner that, in situations where placement of collateral is mandatory, customs authority shall determine an exact amount of the collateral at the level equal to the actual amount of import or export duties which corresponds to the customs debt and other duties which are collected at import or export, if such amount can be determined at the time when the collateral is requested.

On the other hand, if it is not possible to determine the correct amount, the collateral is being determined at the highest possible amount of import and export duties, assessed by the customs authority, and which corresponds to the customs debt and other duties which are collected at import or export, that arose or could arise.

In addition, a mandatory collateral has been established for the majority of customs procedure, as well as for temporary storage of goods. That said, the mandatory collateral that should cover potential and actual customs debts, in the form of guarantee, has been prescribed for special customs procedures: storage procedures (including customs warehousing and free zones), special use procedures which encompass temporary import and special purpose use, and processing procedures encompassing inward and outward processing.

5. New customs simplification measures
(a) Centralized customs clearance 

Article 156 of the new Law prescribes that a customs authority can, on request, approve submission of customs declaration to the customs office in the place where а person has its seat or residence, and where the goods are physically delivered for control to another customs office. The applicant for this type of customs simplification procedure can be the AEO for customs simplifications.

(b) Self-assessment

Article 160 of the new Law prescribes that a customs authority can issue an approval to the AEO for customs simplifications to perform certain customs formalities, which should otherwise be performed by the customs authority, in order to determine the amount of import or export duties which should be paid and to perform certain controls under customs supervision.