Fulfilment Business Secondary Legislation to be published for comment

Monday 16th October 2017

As you may be aware, HMRC is looking to reduce the Customs Duty and VAT loss being incurred through third country internet sellers not accounting for Duty and VAT correctly on goods sold in the UK to retail customers.

The initial thoughts were to introduce a scheme that requires UK fulfilment houses in the UK to conduct "due diligence" on third country clients who hold stock in their fulfilment business for sale to UK customers.

Although the due diligence element is still required, the secondary legislation puts together the detail of the requirement to be authorised by HMRC before a business can undertake the business of fulfilment in respect of 3rd country customers and stock.

The regulations also introduce record keeping requirements, the requirement to notify HMRC of any suspicions in respect of clients and penalties for non compliance.

The draft regulations should be published in the next few days and are required reading if you are involved in fulfilment either directly or indirectly.

One interesting point is that the requirements do not apply to Customs Warehouse operators.