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What are the advantages of AEO status?

Changes set to be brought in on 1st May 2016 will see AEO status become important for all those businesses involved in an international supply chain.

There are many benefits associated with obtaining this status, which have been outlined below.

Advantages with Customs

A major change within the UCC is that any business that operates a ‘Special Procedure’ such as Customs Warehousing, Inward Processing, Outward Processing, End-Use and Temporary Admission where duty and VAT is suspended or deferred will be required to lodge a guarantee which is equivalent to one months’ potential duty and import VAT unlessat the point that either their authorisation expires or (in the case of open ended authorisations such as Customs Warehousing) HMRC reassess their ongoing authorisation they:-

  • Have AEO (C) accreditation; or
  • Can demonstrate that they meet the AEO (C) criteria.

On a practical level AEO status means items pass through customs as quickly as possible as well as:

  • It will be quicker and easier to obtain Customs simplifications
  • Businesses will be subjected to fewer physical and document checks at borders
  • If you are selected at controls, you will be given priority as an AEO consignment
  • You can request that a control is held at a different place

Advantages for business

AEO is internationally recognised. Therefore, as a “preferred supplier”, business opportunities will likely rise, giving you the chance to expand within a network of accredited, vetted suppliers and transporters.

Other advantages for businesses include:

  • More efficient transporting through borders
  • Less risk and more effective checks on the reliability of third parties
  • Potentially lower insurance premiums in the future
  • More efficient import/export system, logistically for those involved

Global advantage

AEO standards are not restricted to the EU, and this status will ensure your business enjoys the associated benefits in a number of international markets.

  • More than 70 countries are included in the AEO, or a similar initiative
  • There are opportunities for your business to expand into new territories with the benefit of a mutual “approved supplier” framework
  • A more efficient approach to international Customs

Financial advantage

The advantages brought about by AEO have efficiency, productivity and profits at their core. Of course, faster Customs checks, a global network of improved suppliers and a certificate of reliability and safety will have considerable benefits for any business.

To become an AEO operator, you must meet strict requirements, many of which are financial and must be checked by HMRC.

Other financial advantages include:

  • More efficient logistics, increasing profit
  • Less risk when working with third parties
  • A quicker, more efficient approach to Customs reliefs and applications
  • Preferential treatment from other businesses and Customs itself

Get in Touch

To discuss applying for AEO status with a professional, contact The Customs People today on 0161 82 68 926.