Trade Mechanisms in Agri-Food Markets: Proof of Trade & Reference Quantity Clarifications

1. Trade mechanisms14 February 2018AGRI.G.1 - Governance of the agri-food markets

2. Art. 8 - 9 DA (proof of trade & reference quantity) Clarification of the text: • How proof of trade & reference quantity are calculated • The maximum quantity an operator may obtain during a TRQ period shall be limited by its reference quantity.

3. Art. 14 IA (proof of trade) The current formulation of Art. 14(1)(a) is considered appropriate for both pre and post 2020: 1. Operators shall furnish the proof of trade referred to in Article 8 of Delegated Regulation 2018/ XX to the licence issuing authority either: (a) by means of customs data showing release for free circulation or exportand containing a reference to the operator as declarant referred to in Article 5(15) of Regulation (EU) No 952/2013 or as importer referred to Annex B Title I Chapter 3 Group3 and in Title II Group 3 of Delegated Regulation (EU) 2015/2446 according to the national implementation by the Member State concerned; or […] • Part in red modified according to DE suggestion (to avoid double use of the same customs declaration by both importer and declarant to apply for a licence )

4. Reference quantity Follow-up consultation with international units The calculation of reference quantity is based on the quantity of products released by the operator for free circulation Products exported are not included in the calculation

5. Reference quantity MSs are invited to provide their feedback on the following approach to the calculation of reference quantity: • Strict approach (on CN codes/origin) for poultry "LORI" TRQ • Flexible approach for beef & veal TRQ (09.4270 and 09.4003) -> keep the status quo

6. Art. 15 IA (reference quantity) • The Article refers now to invoice and not "commercial" invoice anymore • "invoice" means any invoice which relates to the declared transaction value -> no pro-forma • The customs declaration must contain the invoice number (box 44) • Invoice to be provided by operators to LIA only (not to customs anymore) • Checks to be performed by LIA (not by customs) • LIA compares "invoice number" in customs declaration with invoice presented to LIA

7. Art. 15 IA (reference quantity) UCC and Implementing Reg. 2015/2447 foresee the possibility to require invoices. • UCC Art. 163: 1. The supporting documents required for the application of the provisions governing the customs procedure for which the goods are declared shall be in the declarant's possession and at the disposal of the customs authorities at the time when the customs declaration is lodged. 2. Supporting documents shall be provided to the customs authorities where Union legislation so requires or where necessary for customs controls. • UCC IA Art. 145: The invoice which relates to the declared transaction value is required as a supporting document. In the new TRQ model, NO CHECKS TO BE PERFORMED BY CUSTOMS!!! (apart for the "usual" checks currently in place)

8. Art. 5 IA (Licence application) Art. 5(4): […] applications shall be admissible only if received by 13:00 hours Brussels time of the closing calendardate • No working day -> the definition of working day differs among MS/regions/towns • Up to LIA to decide if anticipate the date or ensure permanence in case the last calendar day is not working day

9. Art. 6 IA (licence application) • The only TRQ for which operators may lodge more than one licence application per month are: • TRQ managed with documents issued by third countries • TRQ in Annex I.6 • For ALL other TRQ: general rule applies

10. Art. 9(8) IA (LORI) HOW THE PROCESS WORKS: • Before calculating the allocation coefficient, ISAMM runs a last check on LORI data • For some applicants the Commission may request to check the LORI records • Then the Commission calculates the coefficient, and publishes it within the deadline • Licences are issued after the publication of the coefficient • At least the 21st of the following month, LIA gives the answer on the questions on LORI records received the previous month. • If the answer shows that the applicant did not have the right to ask a licence: • The LIA has to reclaim the licence back from the titular holder • When he would already have used the licence, the art. 13(4) DA applies. -> In case the applicant is proved to be without substantial activity, and it has submitted another application in month N+1 -> withdrawn MONTH N MONTH N+1

11. Art. 11(4) and (5) IA (licence validity) Rice and CA The licences validity will be shorter than in the current situation This is not expected to cause disruptions in the system -> provisions version 17 = version 16

12. Art. 21 IA (notifications) • No more obligation of notifications for exports under the cheese quota opened by Canada • For pet food to Switzerland no obligation is currently in place, so no new obligation will be introduced

13. Annex I • New Annex I.7, listing 2 missing export quotas: - Cheese quota opened by USA - Milk powder quota opened by the Dominican Republic • New titles for Annexes I.2 and I,4 to match Art. 3 draft IA

14. Annex I • TRQ under Annex V to Agreement with Iceland approved by Decision (EU) 2017/1913 (-> Reg 2535/2001) – as from 1 May 2018 - 2 existing TRQ 09.4205 and 09.4206 are replaced by 09.4225 (Natural butter) and 09.4226 ("Skyr") • New TRQ: 09.4227 (cheeses) • TRQ 09.4277, 09.4278, 09.4279 taken out Temporary autonomous trade measures for Ukraine These quotas are not on a permanent basis : not included in horizontal Reg.

15. LORI: Request Operator Access Request user name Operator EU Login System Get user name Request access to ISAMM LORI form Reject Operator has access to ISAMM Accept Single Liaison Body (ex-NUA)

16. LORI: Workflow in ISAMM When operator has access to ISAMM Operator Prepare for sending Refuse + comments Communication Manager Reject + comments Send LORI Commission Accept

17. LORI: Encoding methods 1. Encode data in ISAMM web form 2. Upload XML document into ISAMM Drop file here Generated by your local IT system

18. ? LORI IT Split of responsibilities for approval: • Single Liaison Body (ex-NUA): it approves the access to ISAMM (for both operators and LIA employees) • LIA: it approves the registration of the operators in LORI database (and performs the necessary checks)

19. ? LORI IT IT unit will prepare a short manual on LORI, explaining: • Single Liaison Body and access to ISAMM for operators • MS licence issuing authority: role&responsibilities • Operators: role&responsibilities • Info for technical IT people in LIA when LORI database is finalized

20. Declaration of independence Field C: introduced a last cell, after the "signature", about the "status of signatory" (-> UK request)

21. Rice Obligation in Article 33 IA limited to the following TRQ: • 09.4127 • 09.4128 • 09.4129 • 09.4149

22. Garlic • Made clear in the text of Art. 46(1)(a) IA that the proof of trade for "traditional importers" is related to import under TRQ licence No change with respect to the current proof of trade

23. Garlic • Re-introduced the obligation to indicate the category of importer in the licence application (box 20) • In licence it is not necessary, being TRQ "category-specific" (= mushrooms)

24. Beef & veal Art. 54 (1) IA: if TRQ preferential duty cannot apply, the next applicable duty is always MFN. No change to Art. 54

25. Beef & veal Created new Annex XVI to include the list of possible CN-codes currently in Annex I of R 382/2008 Art. 55 amended accordingly

26. Cheese quota opened by US Introduced in Art. 71 IA obligation of notification currently in place: "Member States shall notify to the Commission before 31 December the quantities broken down by CN code for which licences have been issued for the following quota year".

27. Cheese quota opened by Canada Introduced in Art. 74(3) IA a second option for licence titular holder: • Present the original export licence • Present a certified copy of the export licence (-> BE request)

28. ? Milk & milk products Provisions in Articles: • 7, 9, 10 (approval of milk operators prior licence application & notification to the Commission) • 43, 44 (checks on reduced import duties) of Reg. 2535/2001 taken out for simplification (no mistake)

29. ? Cereals TRQ 09.4131 (maize ergaomnes) Question: why country of origin is compulsory on Section 8 of licence, being the TRQ "ergaomnes"? For the moment, kept for the link with abatimento regime (need to know what quantities comes from Spain and Portugal). Under discussion with TAXUD -> feedback to be provided asap

30. ? Cereals Proof of origin for 09.4123, 09.4125, 09.4131, 09.4133 according to Art.16(2) -> simplification "the origin declaration shall be provided on an invoice or any other commercial document that describes the originating product in sufficient detail to enable its identification."

31. Thank you

32. New version Art. 15(1) IA The reference quantity referred to in Article XX of Delegated Regulation 2018/… shall be established on the basis of a certified print out of the customs declaration finalised for release for free circulation: - pertaining to the products mentioned in the invoice referred to in Article 145 of Commission Implementing Regulation 2015/2447. - and indicating the licence applicant as a declarant referred to in Article 5 (15) of Regulation (EU) 952/2013 or as importer referred to Annex B Title I Chapter 3 Group3 and in Title II Group 3 of Delegated Regulation (EU) 2015/2446. The operator must ensure that the customs declaration for free circulation contains the invoice number referred to in Article 145 of Commission Implementing Regulation 2015/2447. The invoice shall be presented by the operator to the licence issuing authorities for establishing its reference quantity, and it should include at least the name of the importer or declarant, a detailed description of the product which enables unambiguous identification, and the invoice number. Member States shall take the necessary steps enabling their licence issuing authorities to compare the information on invoices, import licences and customs declarations with regard to the importer or declarant name, product description and invoice number. Such verifications shall be made in accordance with Member States' risk analysis.