The Export (Penalty) Regulations 2003

Citation and Commencement U.K.

1.  These regulations may be cited as the Export (Penalty) Regulations 2003 and shall come into force on 23 December 2003.

Interpretation U.K.

2.  In these regulations—

F1 ...

“appeal tribunal” means [F2 the First-tier Tribunal or, where determined by or under Tribunal Procedure Rules, the Upper Tribunal];

F3 ...

“the Code” means Council Regulation 2913/92/EEC M1 ;

“Community customs rules” means customs rules, as defined in Article 1 of the Code;

“Community export duty” means any of the duties, charges or levies which are export duties within the meaning of the Code (see the definition of “export duties” in Article 4(11) M2 of that Code);

“contravene” includes fail to comply with;

“declaration” in relation to export has the meaning assigned by Article 4(17) of the Code;

“demand notice” means a demand notice within the meaning of regulation 6;

“export” means that “customs procedure” within the meaning of Article 4(16)(h) of the Code;

“exporter” has the meaning assigned to it by Article 788 of the Implementing Regulation;

[F4 “HMRC” means Her Majesty’s Revenue and Customs.]

“the Implementing Regulation” means Commission Regulation 2454/93/EEC M3 ;

“notice” means notice in writing;

“person” means a person, of a description specified in Column 2 of the Schedule to these Regulations to whom that provision referred to in Column 1 applies;

“penalty” shall mean a penalty up to the maximum amount specified in Column 3 of the schedule to these Regulations;

“relevant export rule” shall mean any Community imposed duty, obligation, requirement, or condition in relation to export imposed or implemented by or under any of the following provisions or combination of provisions in any case where Community export duty is not chargeable or payable in application of the rule—

(a)

Community customs rules in relation to export;

(b)

the Act, as it applies in implementation of Community customs rules in relation to export from the [F5 European Union];

(c)

any other Act, or statutory instrument, as it applies in implementation of Community customs rules in relation to export from the [F5 European Union];

(d)

any directly applicable [F5 EU] legislation as it applies in application of Community customs rules in relation to export;

(e)

any relevant international rules applying in relation to export;

specified in Column 1 of the Schedule to these Regulations;

“relevant international rules” means international agreements so far as applying in relation to export from the [F5 European Union] and having effect as part of the law of the United Kingdom by virtue of—

(a)

any directly applicable [F5 EU] legislation, or

(b)

any Act or statutory instrument implementing such agreement.

“representative”, in relation to any person, means—

(a)

his personal representative,

(b)

his trustee in bankruptcy or interim or permanent trustee,

(c)

any receiver or liquidator appointed in relation to that person or any of his property,

or any other person acting in a representative capacity in relation to that person.

Textual Amendments

F1 Words in reg. 2 omitted (11.11.2011) by virtue of The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 3

F2 Words in reg. 2 substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 121(2)

F3 Words in reg. 2 omitted (11.11.2011) by virtue of The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 4

F4 Words in reg. 2 inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 121(3)

F5 Words in reg. 2 substituted (22.4.2011) by The Treaty of Lisbon (Changes in Terminology) Order 2011 (S.I. 2011/1043), arts. 2, 3-6

Marginal Citations

M1 O.J.L302.19.10.92,p1

M2 Amended by Council Regulation (EC) 82/97, O.J. L017, 21.01.1997 p1 and Council Regulation (EC) 2700/2000 O.J. L311, 12.12.2000, p17.

M3 O.J.L253,11.10.93,p1.

Penalty for contravention of a relevant export rule U.K.

3.—(1) If a person engages in any conduct by which he contravenes a relevant export rule specified he shall be liable to a penalty under this regulation.

(2) The Schedule to these regulations shall have effect.

(3) Column 1 of the Schedule specifies a relevant export rule a contravention of which gives rise to a penalty under paragraph (1) above.

(4) Column 2 of the Schedule specifies the person whose conduct in contravening a relevant export rule gives rise to liability under paragraph (1) above.

(5) Column 3 of the Schedule specifies the maximum penalty for contravention of a relevant export rule for which a person is liable under paragraph (1) above.

Exceptions from regulation 3 U.K.

4.—(1) A person is not liable to a penalty under regulation 3 if he satisfies—

(a) [F6 HMRC], or

(b) on appeal, an appeal tribunal,

that there is a reasonable excuse for his conduct.

(2) For the purposes of paragraph (1) above none of the following is a reasonable excuse—

(a) An insufficiency of funds available to any person for paying any penalty due;

(b) That reliance was placed by any person on another to perform any task;

(c) That the contravention is attributable, in whole or in part, to the conduct of a person on whom reliance to perform any task was so placed.

(3) Where, by reason of conduct falling within regulation 3(1) a person is prosecuted for an offence that conduct does not also give rise to liability to a penalty.

Textual Amendments

F6 Word in reg. 4 substituted (11.11.2011) by The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 5

Reduction of penalty under regulation 3 U.K.

5.—(1) Where a person is liable to a penalty under regulation 3—

(a) [F7 HMRC] (whether originally or on review) or, on appeal, an appeal tribunal may reduce the penalty to such amount (including nil) as they think proper; and

(b) [F7 HMRC] on a review, or an appeal tribunal on an appeal, relating to a penalty reduced by [F7 HMRC] under this regulation may cancel the whole or any part of the reduction previously made by [F7 HMRC].

(2) In exercising their powers under paragraph (1) above, neither [F7 HMRC] nor an appeal tribunal are entitled to take into account any of the matters specified in paragraph (3) below.

(3) Those matters are—

(a) The insufficiency of the funds available to any person for paying the amount of the penalty,

(b) The fact that the person liable to the penalty, or a person acting on his behalf, has acted in good faith.

Textual Amendments

F7 Word in reg. 5 substituted (11.11.2011) by The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 5

Demands for penalties U.K.

6.—(1) Where a person is liable to a penalty under regulation 3, [F8 HMRC] may give to that person or his representative a notice in writing (a “demand notice”) demanding payment of the amount due by way of penalty.

(2) An amount demanded as due from a person or his representative in accordance with subsection (1) is recoverable as if it were an amount due from the person or, as the case may be, the representative as an amount of customs duty.

This paragraph is subject to—

(a)

any appeal under regulation [F9 9] (appeals to tribunal); and

(b)

paragraph (3) below.

(3) An amount so demanded is not recoverable if or to the extent that—

(a) The demand has subsequently been withdrawn; or

(b) The amount has been reduced under regulation 5.

Textual Amendments

F8 Word in reg. 6 substituted (11.11.2011) by The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 5

F9 Word in reg. 6(2)(a) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 122

Time limits for demands for penalties U.K.

7.—(1) A demand notice may not be given in relation to a penalty under regulation 3 more than 3 years after the conduct giving rise to the penalty ceased.

(2) A demand notice may not be given more than 2 years after there has come to the knowledge of [F10 HMRC] evidence of facts sufficient in the opinion of [F10 HMRC] to justify the giving of the demand notice.

(3) A demand notice may be given in respect of a penalty under regulation 3 to which a person was liable immediately before his death.

Textual Amendments

F10 Word in reg. 7 substituted (11.11.2011) by The Export (Penalty) (Amendment) Regulations 2011 (S.I. 2011/2512), regs. 1, 5

No prosecution after demand notice for penalty under regulation 3 U.K.

8.—(1) Where a demand notice is given demanding payment of an amount due by way of penalty under regulation 3 in respect of any conduct of a person, no proceedings may be brought against that person for any offence constituted by that conduct (whether or not the demand notice is subsequently withdrawn).

[F11 Right to appeal against certain decisions] U.K.

9.—(1) If [F12 HMRC] give a person or his representative a notice informing him—

(a) that [F13 HMRC] have decided that the person has engaged in conduct by which he contravenes a relevant export rule, and

(b) that the person is, in consequence, liable to a penalty under regulation 3, but

(c) that [F14 HMRC] do not propose to give a demand notice in respect of the penalty,

the person or his representative may [F15 make an appeal to the appeal tribunal in respect of] the decision mentioned in sub-paragraph(a) above.

(2) Where [F16 HMRC] give a demand notice to a person or his representative, the person or his representative may [F17 make an appeal to the appeal tribunal in respect of]—

(a) their decision that the person is liable to a penalty under regulation 3, or

(b) their decision as to the amount of the liability.

[F18 (3) The powers of the appeal tribunal on an appeal under this regulation include—

(a) power to quash or vary a decision; and

(b) power to substitute the tribunal’s own decision for any decision so quashed.

(4) On an appeal under this regulation—

(a) the burden of proof as to the matters mentioned in regulation 3(1) lies on HMRC; but

(b) it is otherwise for the appellant to show that the grounds on which any such appeal is brought have been established.]

Textual Amendments

F11 Reg. 9 heading substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(2) (with Sch. 3 paras. 2-4)

F12 Word in reg. 9(1) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(3)(a) (with Sch. 3 paras. 2-4)

F13 Word in reg. 9(1)(a) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(3)(b) (with Sch. 3 paras. 2-4)

F14 Word in reg. 9(1)(c) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(3)(b) (with Sch. 3 paras. 2-4)

F15 Words in reg. 9(1) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(3)(c) (with Sch. 3 paras. 2-4)

F16 Word in reg. 9(2) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(4)(a) (with Sch. 3 paras. 2-4)

F17 Words in reg. 9(2) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(4)(b) (with Sch. 3 paras. 2-4)

F18 Reg. 9(3)(4) substituted for reg. 9(3) (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 123(5) (with Sch. 3 paras. 2-4)

[F19 Offer of review U.K.

9A.— (1) HMRC must offer a person (P) a review of a decision that has been notified to P if an appeal lies under regulation 9 in respect of the decision.

(2) The offer of the review must be made by notice given to P at the same time as the decision is notified to P.

(3) This regulation does not apply to the notification of the conclusions of a review.]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

[F19 Review by HMRC U.K.

9B.— (1) HMRC must review a decision if—

(a) they have offered a review of the decision under regulation 9A, and

(b) P notifies HMRC accepting the offer within 30 days from the date of the document containing the notification of the offer.

(2) But P may not notify acceptance of the offer if P has already appealed to the appeal tribunal under regulation 9F.

(3) HMRC shall not review a decision if P has appealed to the appeal tribunal under regulation 9F in respect of the decision.]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

[F19 Extensions of time U.K.

9C.— (1) If under regulation 9A, HMRC have offered P a review of a decision, HMRC may within the relevant period notify P that the relevant period is extended.

(2) If notice is given the relevant period is extended to the end of 30 days from—

(a) the date of the notice, or

(b) any other date set out in the notice or a further notice.

(3) In this regulation “relevant period” means—

(a) the period of 30 days referred to in regulation 9B(1)(b), or

(b) if notice has been given under paragraph (1) that period as extended (or as most recently extended) in accordance with paragraph (2).]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

[F19 Review out of time U.K.

9D.— (1) This regulation applies if—

(a) HMRC have offered a review of a decision under regulation 9A, and

(b) P does not accept the offer within the time allowed under regulation 9B(1)(b) or 9C(2).

(2) HMRC must review the decision under regulation 9B if—

(a) after the time allowed, P notifies HMRC in writing requesting a review out of time,

(b) HMRC are satisfied that P had a reasonable excuse for not accepting the offer or requiring review within the time allowed, and

(c) HMRC are satisfied that P made the request without unreasonable delay after the excuse had ceased to apply.

(3) HMRC shall not review a decision if P has appealed to the appeal tribunal under regulation 9F in respect of the decision.]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

[F19 Nature of review etc U.K.

9E.— (1) This regulation applies if HMRC are required to undertake a review under regulation 9B or 9D.

(2) The nature and extent of the review are to be such as appear appropriate to HMRC in the circumstances.

(3) For the purpose of paragraph (2), HMRC must, in particular, have regard to steps taken before the beginning of the review—

(a) by HMRC in reaching the decision, and

(b) by any person in seeking to resolve disagreement about the decision.

(4) The review must take account of any representations made by P at a stage which gives HMRC a reasonable opportunity to consider them.

(5) The review may conclude that the decision is to be—

(a) upheld,

(b) varied, or

(c) cancelled.

(6) HMRC must give P notice of the conclusions of the review and their reasoning within—

(a) a period of 45 days beginning with the relevant date, or

(b) such other period as HMRC and P may agree.

(7) In paragraph (6) “relevant date” means—

(a) the date HMRC received P’s notification accepting the offer of a review (in a case falling within regulation 9A), or

(b) the date on which HMRC decided to undertake the review (in a case falling within regulation 9D).

(8) Where HMRC are required to undertake a review but do not give notice of the conclusions within the time period specified in paragraph (6), the review is to be treated as having concluded that the decision is upheld.

(9) If paragraph (8) applies HMRC must notify P of the conclusion which the review is treated as having reached.]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

[F19 Bringing of appeals U.K.

9F.— (1) An appeal under regulation 9 is to be made to the appeal tribunal before—

(a) the end of the period of 30 days beginning with the date of the document notifying the decision to which the appeal relates, or

(b) if later, the end of the relevant period (within the meaning of regulation 9C).

(2) But that is subject to paragraphs (3) to (5).

(3) In a case where HMRC are required to undertake a review under regulation 9B—

(a) an appeal may not be made until the conclusion date, and

(b) any appeal is to be made within the period of 30 days beginning with the conclusion date.

(4) In a case where HMRC are requested to undertake a review in accordance with regulation 9D—

(a) an appeal may not be made—

(i) unless HMRC have decided whether or not to undertake a review, and

(ii) if HMRC decide to undertake a review, until the conclusion date; and

(b) any appeal is to be made within the period of 30 days beginning with—

(i) the conclusion date (if HMRC decide to undertake a review), or

(ii) the date on which HMRC decide not to undertake a review.

(5) In a case where regulation 9E(8) applies, an appeal may be made at any time from the end of the period specified in regulation 9E(6) to the date 30 days after the conclusion date.

(6) An appeal may be made after the end of the period specified in paragraph (1), (3)(b), (4)(b) or (5) if the appeal tribunal gives permission to do so.

(7) In this regulation “conclusion date” means the date of the document notifying the conclusions of the review.]

Textual Amendments

F19 Regs. 9A-9F inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 124 (with Sch. 3 paras. 2-4)

Time limit and right to further review U.K.

F20 10.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F20 Regs. 10-12 omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 125 (with Sch. 3 paras. 2-4)

Powers of the Commissioners on a review U.K.

F20 11.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F20 Regs. 10-12 omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 125 (with Sch. 3 paras. 2-4)

Appeals to a tribunal U.K.

F20 12.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F20 Regs. 10-12 omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 125 (with Sch. 3 paras. 2-4)

Appeal Tribunals U.K.

[F21 13.   Section 85 of the Value Added Tax Act 1994 (c. 23) (settling of appeals by agreement) has effect as if the reference to section 83 of that Act included a reference to regulation 9 above.]

Textual Amendments

F21 Reg. 13 substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 2 para. 126

Service of notices U.K.

14.  Any notice to be given to any person for the purposes of these Regulations may be given by sending it by post in a letter addressed to that person or his representative at the last or usual residence or place of business of that person or representative.

Ray McAfee

Commissioner of Customs and Excise