Authorized Economic Operators (AEO)
The Authorized Economic Operator, hereafter referred to as “AEO”, has been in place in all EU Member States since 1 January 2008. Under the provisions of Community law, the authorized economic operator benefits from:
• simplifications provided for by customs legislation; and / or
• facilities related to customs controls related to security and protection.
The main objective of the Customs Department is, among other things, the correct application of Community and national customs legislation to ensure a proper balance between customs controls and the facilitation of fair trade. At the same time, the Department attaches great importance to the correct application of the provisions concerning the authorized economic operators.
2. Legal provisions
• Council Regulation (EC) No 648/2005 of the European Parliament and of the Council of 13 April 2005 amending Regulation (EEC) No 2913/92 establishing the Community Customs Code (Article 5a)
• Council Regulation (EC) Commission Regulation (EC) No 1875/2006 of 18 December 2006 amending Regulation (EEC) (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code (Articles 14a to 14c)
In accordance with Community provisions, an ‘economic operator’ is a person who, in the course of his business, is involved in activities governed by customs legislation.
An “authorized economic operator” means an economic operator who is credible throughout the Community in the context of his customs transactions and is therefore entitled, if he meets certain criteria and conditions, to benefit from certain benefits throughout the Community.
4. Who can become AEO
Requests for AEO status can only be accepted by economic operators, ie persons who, in the course of their business activities, participate in activities governed by customs legislation.
AEO may be:
Manufacturer / producer ↔ exporter ↔ transport agent ↔ warehouse keeper (customs warehouse or temporary storage) ↔ customs broker ↔ carrier ↔ importer.
5. Criteria to be met
Article 5a of the Community Customs Code, Regulation 2913/92 (as amended by Regulation 648/2005) provides for the granting of an AEO certificate to reliable economic operators if they meet the following criteria:
• proper history of compliance with customs requirements.
• a satisfactory system of managing commercial and, where appropriate, transport logs, allowing appropriate customs controls.
• proven financial solvency and
• where appropriate, appropriate security and protection requirements (where the application concerns a certificate – Security and Protection or Certificate – Customs Simplification / Safety and Protection).
AEO criteria apply to all businesses regardless of size.
6. AEO Certificates
There are 3 types of certificates as follows:
6.1. AEO Certificate – Customs Simplifications
It is granted to any economic operator wishing to benefit from simplifications provided for in customs legislation which is established in the Community and fulfills the criteria of customs compliance, appropriate bookkeeping standards and financial solvency.
6.2. AEO Certificate – Security & Protection
It shall be accorded to any economic operator wishing to benefit from facilitations in customs controls relating to the security and protection of the goods entering or leaving the customs territory of the Community established in the Community and fulfilling the criteria of customs conformity, appropriate bookkeeping standards and financial solvency and, in addition, adheres to appropriate safety and security standards (exception to the general rule of Communities provided for in Articles 14g and 14k §2 of Reg. 2454/93, eg an airline or shipping company).
6.3. AEO Certificate – Customs Simplifications / Security and Protection
It is granted to any economic operator established in the Community and fulfills the criteria of customs compliance, appropriate bookkeeping standards, financial solvency, and observes the appropriate safety and security standards and wishes to take advantage of all the benefits provided to AEOs.
7. Application for AEO certificate
7.1. Application form
An application form can also be obtained from the local Customs offices. A properly completed application must be submitted to the Customs Directorate together with its accompanying documents and the self-assessment questionnaire referred to in paragraph 7.3 below.
7.2. Contact person
The applicant should indicate, inter alia, a central point of direct access or a contact person within its administration in order to make available to the customs authorities all necessary information demonstrating compliance with the requirements for issuing the AEO certificate.
7.3. Self-assessment questionnaire for potential AEOs
The purpose of the questionnaire is to assist natural or legal persons intending to apply for their approval as authorized economic operators to carry out their own assessment to determine whether or not they meet the criteria for granting an AEO certificate. This questionnaire is an attempt to identify the potential risks and threats facing the economic operator within its supply chain and the measures it can take to improve its situation and minimize risks. It is therefore recommended that the candidate economic operator carefully study the questionnaire before completing the application and carefully complete it. The completed questionnaire must be submitted with the application.
In order to help applicants complete the self-assessment questionnaire correctly, the European Commission has prepared explanatory notes on how to fill it out. Applicants are encouraged to study these explanatory notes well when they complete the questionnaire.
Note: The questionnaire is divided into 5 sections. The first section helps the Customs Department to obtain an overall picture of the applicant from a “customs point of view”. Each subsequent section corresponds to a specific criterion described in Article 5a of the Customs Code (CC) and the corresponding article of the Customs Code Implementing Provisions (HICP). It is emphasized that section 5 of the questionnaire does not need to be completed in cases where the application only concerns the granting of an AEOC – Customs Simplification (AEOC) certificate.
8. Cases in which the application is not accepted
In the following cases, the application will not be accepted:
• if the application does not comply with the provisions of Articles 14c and 14d of Reg. 1875/2006 (eg it is not submitted to the form provided for this purpose, it does not contain all the required information, it is submitted to the wrong customs office, etc.).
• if the applicant has been convicted of a serious criminal offense related to his or her economic activity or is in bankruptcy at the time of filing the application.
• if the applicant’s legal representative in customs matters has been convicted of a serious criminal offense related to a breach of customs legislation and associated with his / her activity as a legal representative.
• if the application is submitted within three years after the revocation of an AEO certificate already issued (except for specific cases, eg withdrawal of an AEO certificate at the request of the authorized economic operator).
9. Issue of an AEO certificate or rejection of the application
Where the criteria and conditions are fulfilled, the Customs Department issues the relevant AEO certificate, which shall enter into force on the tenth working day following the date of issue.
Otherwise, the application is rejected and the applicant is informed in writing of the reasons for the rejection, after having been informed of the intention of the Department and given the opportunity to respond.
Following the granting of an AEO certificate, the authorized economic operator should inform the Customs Department of any information that may affect the continuity or content of that certificate.
10. Benefits for AEO
As a general principle, the AEO certificate is issued to the applicant and not to his customers. Therefore, the benefits can only be used by the AEO. The benefits for AEOs, depending on the type of certificate, are the following:
• Fewer physical checks and document checks
This benefit will apply from 01/01/2008 and will apply to holders of AEO certificates of all categories.
• Priority in handling cargoes, if selected for inspection
This benefit will apply from 01/01/2008 for all categories of AEO certificates.
• Selection of the place where the checks are carried out
This benefit will apply from 01/01/2008 for all categories of AEO certificates.
• Easier to be subject to customs simplifications
This benefit will apply from 01/01/2008 for AEO certificate holders – Customs Simplifications or AEO Certificate – Customs Simplification / Security and Protection.
• Reduced data set for concise declarations
This benefit will be valid from 01/07/2009 for holders of AEO certificate – Security & Protection or AEO certificate – Customs Simplification / Security and Protection.
This case concerns cases where the load has been selected to undergo a further physical check if the alert does not jeopardize the check to be carried out. This benefit will be valid from 01/07/2009 for holders of AEO – Security and Protection certificate or mixed certificate.
These are the benefits that are not directly related to the customs aspects of AEO’s work, eg limiting thefts, reducing delays in shipments, improving planning,
Improving relations with the customs authorities.
• Recognize as a secure business partner.
• Mutually Recognize.
11. Electronic self-training program (E-learning module)
Under the Community Customs 2007-13 program, the European Commission has prepared a training e-curriculum addressed to economic operators for the effective implementation of Community legislation on AEE.
Those interested in applying for an AEO certificate are encouraged to study the AEO e-leaning module, which is an ancillary tool for the effective and uniform application of Community AEO legislation. The program is located at the following address of the European Union website:
12. Guidelines for the AEO of the European Commission
With a view to a common understanding and uniform application of Community customs legislation on AEO and equal treatment of economic operators, the European Commission has issued guidance (TAXUD/B2/047/2011-Rev.3) are illustrative and do not constitute a binding legal text. Applicants are encouraged to study these instructions carefully before submitting an application.
Information on authorized economic operators can also be found on the European Union’s website under the title: EUROPA – Taxation and Customs Union / Customs and Security/Policy Issues/Customs and Security http://ec.europa.eu/taxation_customs/customs/policy_issues/customs_security/index_en.htm.