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Case Studies

Some of the ways VernonRato have been able to help

1. AEO Pre-UCC

A manufacturing company required AEO (Authorised Economic Operator) status. I was brought in and given 18 months to successfully apply for the status.  I received the application and examined what was needed from the company and me.  I organised a meeting with all heads of department and explained AEO, my responsibilities and what I expected from them.  Having collated all the information, my next task was to assess the site and security of the building, knowing that when HMRC audit the company they would have specific requirements that would need to be met to receive a successful application.  Following my assessments, I put forward my recommendations on improvements to the Directors, who agreed to implement my course of action.

On Audit, HMRC were impressed with both the site security and documentation.  A few weeks later the company received their AEO accreditation, 4 months ahead of schedule.

 

Note:

What Authorised Economic Operator (AEO) status is:-

AEO status is an internationally recognised quality mark that shows your:

  • role in the international supply chain is secure
  • customs controls and procedures are efficient and meet EU standards

It’s not mandatory, but gives quicker access to some simplified customs procedures and, in some cases, the right to ‘fast-track’ your shipments through some customs and safety and security procedures.

 

2. AEO Post-UCC

As part of a global initiative, a FMCG company were looking for all their companies to have an accreditation in line with their C-TPAT. I was responsible to Project Manage the application in UK and helped co-ordinate the application in Europe. Both the accreditations were complete, audited and passed within four months. With the UK being the most difficult as it has 24 manufacturing sites. I had to manage and co-ordinate all 9 audits with the factories, staff and HMRC which was a great challenge as the factories are distributed far and wide around the UK. 

Note:

  • FMCG: Fast-Moving Consumer Goods
  • C-TPAT:  (Customs–Trade Partnership Against Terrorism) is a voluntary, joint government-business partnership to help add to supply chain and increase border security.

3. Freight Cost and Transit Times

A manufacturer was spending over £15,000.00 a month on freight costs, for indirect services. Transit times, door to door, were taking over a week on major routes. The company needed to make changes and considerable savings.

My first task was to assess the lanes and volumes and document this. I set about creating an RFQ (Request for Quote) to various forwarders that they currently use and new companies with my experience in the freight forwarding industry. Having meetings with the forwarder’s sales executives, based on the quote, transit times and communication/value of service, I was able to find the right forwarder to handle the company’s goods. I had a meeting with the company’s Directors and Vice Presidents and presented my nomination to them and why I thought they would be the best fit for the company. Once approved, I negotiated the SOP (Standard Operating Procedure) together with the legal department on how I would like the freight moved from door to door and what communication and documents were needed.

Once the SOP was signed off by both parties, the company were able to save over £100,000.00 in freight costs within their 1st year on a direct service, whilst cutting transit times to 3-4 days in most lanes.

4. Import Duty and Vat

Due to my cost savings ability, I was employed to come into a company and help them save money on their import Duty and VAT.

I began to evaluate all the company’s products from single units to full systems. I identified that because the company manufactured the units and systems in the UK the best way for them to import the goods, and make cost savings, was through IPR (Inward Processing Relief).  Further information was obtained by examining the process from import to re-export and the system used to document the process.  I completed the IPR application and within a month we received an IPR number and the company was fully able to start their cost savings.

Having the IPR number I was able to save the company over £300,000.00 in import duty costs and £850,000.00 in VAT cash flow in their 1st year.

5. Save Money on Import Goods

A company were looking to save money on importing their purchased components into the UK. They had various manufacturers worldwide sending products to them in the UK, to enable the manufacture of an intact unit.

I analysed their commodity codes and looked for ways I could reduce the duty rate they were currently paying. Working with the buyers of the company, I was able to receive documentation from the supplier on how they would assess their products. Knowing that the first 4 digits worldwide are the same for the item, I was able to have a starting chapter in the UK classification. Reading and assessing the product I was able to find the correct tariff code and achieve a reduction in duty costs.

After reclassifying all their goods, the company had reductions in duty costs in over 90% of goods imported. In some cases, after reclassifying them, the duty rate fell from 7% duty rate to zero rated.

6. Reclaim money on Import goods declared though an incorrect Customs regime

During a self-assessment with a manufacturing company, I noticed that they imported specific goods during a period. The period in question, they were authorised for a regime that they should have suspended the import duty and VAT.

I investigated and pulled out all the relevant paperwork and created a sheet with my workings. I had to ensure that the goods were used and manufactured into a finished item to qualify for the reclaim. Once I gathered all the export information, I created a worksheet for duty reclaim which was submitted to HMRC.

Once HMRC did their investigations, the company managed to claw back £865k in duties alone during this period.

7. CCG (Customs Comprehensive Guarantee)

A company I was working for had various regimes and post UCC, if one regime expires, a new assessment would be made on all other authorisations. I was fully responsible to reapply for these authorisations and under UCC regulations had to apply for a CCG.

As the company was not authorised for AEO and with the history the CCG should have been 100% which would mean £21million. Demonstrations of compliance with correct processes and procedures in place, I Managed to get a 0% for the business.

I managed to get this again when the company had to apply for Customs Warehouse and therefore a Guarantee needed to be in place for 100% of their imports from a 3rd country. This again was a 0% guarantee from a potential £72 million.

Note:

UCC. Import, export and storage procedures following the introduction of the Union Customs Code.

8. Customs Warehouse

As part of Brexit mitigation as well as compliance, I was responsible for applying Private Customs Warehouse on behalf of a manufacturer who had various off-site storage locations.

I had to collect all the information from various applications which, as the company was not accredited with AEO happened to be 4 different application as well as reapplying for CCG (Customs Comprehensive Guarantee). This was Extremely difficult due to tasks falling outside my experience. IT interfacing with the CMS (Customs Management System), inventory management, SAP and Freight Forwarder interfaces all within the scope of the project.

The project was successfully completed in 3 months as well as the audit taking place during month 4. The company received their Customs Warehouse during month 5 of the project.

Note:

SAP is an acronym for Systems, Applications and Products.