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Customs: between Scylla and Charybdis

The participants of foreign economic activity complain about the excessive pressure from the Federal Customs Service of Russia (FCS) amid the general economic downturn. For its part, the Federal Customs Service regards the treasury reimbursement as its most important task in a crisis period. In the interests of business and customs this contradiction is regulated by the declared innovation - Transfer of cargo customs clearance to the state border and the establishment of the common custom space between Russia, Belarus and Kazakhstan.

 Stocks in the till 

According to the participants of foreign economic activity in the past year, the FCS has resorted to the procedure of adjustment of customs commodity cost and the recovery of unreasonable fines. According to Roman Kozlov, CEO of Customs Brokers Association "North-West", Сustoms overprices artificially the goods through the adjustment of their customs value. According to customs brokers, this fact is confirmed by the jurisprudence. As Stanislav Baranov, managing partner of law firm K & B Group reported, until recently, the FCS had lost 90% of legal case concerning the overpricing."However, somebody believes courts received a tacit directions not to interfere with the FCS collecting money for the state" - Stanislav Baranov suggested. 

Indeed, FCS reported, in 2009 one of its basic functions was to replenish the state budget. "Reimbursement of the federal budget revenues is one of the most important tasks of the customs authorities. Implementation of the planned target was achieved in a challenging global economic environment ", FCS report for the year 2009 says. At the end of 2009 the customs authorities met the benchmark of the year for transfers to the budget, having remitted 3 trillion 483.2 billion rubles (Benchmark of 2009 - $ 3 trillion. 472.04 billion rubles). These figures exceed the level of 2006 and 2007.

According to the above-mentioned report, FCS acknowledges that targets overfulfilment amid economic slump has been achieved through a "provision of legal entry of goods, the supervision of customs value, the application of risk management, the use of the check system after the release of the goods (postaudit) in combination with law enforcement."

At the same time, the Statute concerning the Federal Customs Service does not mention that the most important task is to raise money for the state budget. Art. 1 of the Statute states that the FCS should carry out State policy formulation and regulatory control, supervision of customs law, to act as a currency control agent and prevent smuggling, crimes and misdemeanors.

On practice, when fundraising from participants of Foreign Economic Activity (FEA) becomes the main purpose of the Customs, it turns out to be severe problem for businesses. According to Stanislav Baranov, there were 1,5 thousand actions against Baltic Customs brought to the court in 2009. According to the lawyer, six months are required (in some cases - a year) to recover money from the Customs judicially. "That is why small companies can not afford to sue FCS. And in its turn, FCS takes advantage of it”, Stanislav Baranov reports.

We believe, such policy of FCS in a crisis period is quite clear, though. If the Government establishes the social guarantees as a priority in the crisis-proof measures, it would require the collections from State budget, first of all from business sphere. Besides the protection of domestic manufacturer is considered to be one of the top measures under the Crisis management system. So there is no sense for participants of FEA to complain on FCS activity. Till the State is completely sure it can provide the appropriate social guarantees, we can hardly expect the mitigation of customs clearance. FCS will have to be between the horns of dilemma, maneuvering between the meeting the needs of business and necessity of treasury reimbursement.