Monday, June 1, 2020

With Brexit in Mind a Freight Forwarder's View on Authorised Economic Status

So What Can AEO Actually Mean for Me?
Shipping News Feature

UK – Authorised Economic Operator Status (AEO) is a term much bandied about at the moment as the Brexit negotiations get under way again, but what does it actually mean for a shipper, particularly one who has little experience with the complexities of international trade and specifically, Customs procedures?

AEO status is an internationally recognised quality mark that shows a business’s role in the international supply chain is secure and has customs control procedures that meet UK and EU standards. John Good Logistics, based in East Yorkshire, but with a range of offices spanning the country, has had AEO status for over a decade and this week has been explaining exactly what the certified agent can offer when possessing such a qualification. AEO Accreditation is awarded by UK Customs and acts increasingly as a quality standard within many international organisations.

Indeed often potential business customers will insist on this as an integral part of any trading partnership as a globally recognised mark of excellence. As part of the AEO accreditation process in the UK, HM Revenue & Customs (HMRC) officials stringently assess, amongst other things, a company’s finances, site security, shipping procedures, compliance with customs requirements and fulfilment of the relevant legal and safety regulations

Companies holding Authorised Economic Operator (AEO) certification already have an advantage when importing and exporting, especially to and from the world's largest economies, through Mutual Recognition Agreements, which means post-Brexit, AEO certification remain a key factor in ensuring cargo keeps moving seamlessly. The goods are subject to a faster application process for customs simplifications and authorisations

So the bottom line is that those using an agent with the protection of AEO status get greater access to priority Customs clearances, less administration, less delays and, assuming the holder has a lower risk score with HMRC, fewer physical and documentary checks at borders and faster access to certain customs procedures, including some of the HMRC's own safety and security procedures.

John Good Logistics also reckon it means better traceability and security of goods in transit, fewer delays in despatch and improved security between supply chain partners. Which begs the question, why would you trust your goods to an agent who doesn’t have AEO status, particularly post-Brexit when it will, in the minds of many, simply be an essential component of any international movement?