Select Committee on Treasury Minutes of Evidence


Memorandum by HM Customs and Excise

  In his evidence given on 14 November 2001, the Chairman said (Questions 128, 129, 132 and 134) he would review the background checks carried out before an applicant to be an authorised warehousekeeper is registered.

  The Warehousekeepers and Owners of Warehoused Goods Regulations 1999 (WOWGR), which came into effect in October 1999 require that:

    —  goods may only be held in duty suspension in an excise warehouse if an authorised warehousekeeper has been registered in respect of that warehouse (as well as the premises having been approved); and

    —  owners who wish to deposit goods in an excise warehouse (or buy warehoused goods) must either be registered or appoint a Duty Representative to act on their behalf.

  Following these Regulations, Customs performs a number of background checks, prior to registration, using a variety of both internal Customs and other sources (such as Companies House information). These checks provide Customs with an assessment of the suitability of each applicant and we only authorise those applicants who meet our requirements. In particular, we will not approve anyone who (at the time of applying) has an "unspent" conviction under The Rehabilitation of Offenders Act 1974 (other than minor motoring offences) or has accepted a compounded settlement from Customs during the preceding 3 years.

Improvements

  In May 2001, as part of a review of registration procedures, Customs introduced new measures designed to tighten up the system, most notably:

    —  A mandatory pre-approval visit; and

    —  post authorisation visits to be carried out after three months.

  The pre-approval visit will allow Customs to:

    —  Ascertain whether that the applicant is a fit and proper person to hold the authorisation;

    —  confirm there is a genuine commercial need for the authorisation;

    —  obtain details of the applicant's customer base; and

    —  ensure the trader's system will comply with The Revenue Traders (Accounts and Records) Regulations 1992.

  A decision whether to authorise or not will only be made once all the necessary checks have been carried out satisfactorily.

  We have been monitoring authorisations reviewed since the introduction of the new measures in May 2001. The information is given in the table below.

MAY 2001 TO OCTOBER 2001

  
Authorisations
reviewed
Authorisations
revised
Additional
conditions
applied
Authorisations
revoked
Warehousekeepers
67
9
6
19*
Owners of
warehoused goods
124
2
1
16*

* Some of these will have been revoked because the trader is no longer in business but had not notified us.


  We are satisfied that, taken together with post-registration procedures, the checks currently undertaken on all applicants do address the potential risks, although we will continue to review and monitor our authorisation procedures and make improvements when required.

17 December 2001



 
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