Customs and Excise have won a major legal victory in their war against cross-channel alcohol and tobacco smugglers. The Court of Appeal in London has cleared the way for court orders to be sought for the destruction of goods held in limbo following an earlier High Court judgment. Ordinary "booze cruisers" will be allowed to carry on shopping for Christmas. Customs ran into problems pursuing suspected smugglers in the wake of a ruling in July which effectively outlawed random checks on vehicles returning from the Continent and held that, because Customs officers kept no record of their reasons for stopping and searching a vehicle, there was no proof that they had reasonable grounds for doing so. Because the stopping was unlawful, the seizure of the goods and the vehicle was also held unlawful. That ruling was reversed by the Court of Appeal, which held that an unlawful stop did not invalidate the seizure, although it was still for Customs to show, if challenged, that the goods were being brought in for commercial purposes rather than for personal use. The regulations have been changed since the July ruling, with booze cruisers now allowed to bring home larger quantities of tobacco in addition to their alcohol quota, and the onus on the Customs to prove illegality rather than shoppers having to prove their innocence. Customs officers now keep a record of their reasons for a vehicle check. (Ananova 10th December 2002)
BULLYING Customs officers who grab booze cruisers’ cheap alcohol and tobacco are facing a court showdown. A tough-talking European Commissioner is vowing action after Chancellor Gordon Brown failed to tell him why British trippers are being deprived of their legal rights. And The Sun today launches a major campaign to get the Customs bullies off our readers’ backs. We went into action 24 hours after a granny was thrown off a pensioners’ coach and left sobbing by the roadside after her sherry and cigarettes were seized. The Sun told yesterday how Pam Ellis, 63, was stranded 200 miles from her Nottingham home when Dover officials pounced following a day-trip to Calais. Our campaign comes as thousands of Brits prepare to cross the Channel for bargain Christmas drink. The High Court ruled in August that Dover Customs had exceeded their powers with random searches to trap cig and booze "smugglers". Yet the searches have continued — even though current rules state that the millions of Brits who go on booze cruises every year CAN import as much as they like for their own use. Folk who breach unofficial "guidelines" of 800 cigs, 90 litres of wine and 110 litres of beer may have their goods and car confiscated. Protesters claim up to 20,000 vehicles have been impounded as "punishment" since 2000. (The Sun 20/10/02)
The Slovenian eurosceptic party Nova Stranka are currently collecting 40,000 signatures needed to hold a referendum on a law that will effectively close all duty-free shops on the borders between Slovenia and the EU. According to Nova Stranka, Slovenia does not have to close any duty-free shops until it is accepted into the EU. Despite this, says Nova Stranka, the main political parties are still supporting the law and claiming that it is necessary in order for the country to fulfil its obligations to the EU. Under Slovenian law, 40,000 signatures are needed in order to file a full initiative for a referendum. Mr Drevensek believes that Nova Stranka's referendum campaign is important for two reasons. "Firstly, this is the first time that a non-parliamentary party has started such an initiative," he told the EUobserver.com. "Also, this is the first debate launched in Slovenia on a national level about EU matters." (EUobserver.com 27/6/01)
From April 2001 the £10 rate of duty on flights from the UK to other parts of the European Economic Area will be halved to £5 for economy fares. Duty on single flights within the UK will also be halved to £5, but the duty will now be levied on return flights, in line with EU rules. First and club class fares in the EEA will remain at £10. Business class travelers on long haul flights will face a doubling of duty to £40. BA said the duty still penalises British business. The rise makes business class flights across the north Atlantic from London more expensive than departures from other European airports. (FT 22/3/00)
Duty-free shopping within the EU is to be banned in June 1999. This will mean ferries and airports will charge more because they will lose profits of GBP280m. Manufacturers of duty-free goods will lose profits of GBP65m pa. and 1,500 direct jobs will be lost. (FT 13/3/97). The UK has 25% of the duty free trade and 23,000 UK supporting jobs may go (BBC R4 12/3/97). Ferry fares would have to go up 30% to compensate and many routes would be closed. Airports would have to increase landing fees by 60%. (FT 11/6/97). Commissioner Monti said that protests were a waste of time (FT 25/9/97). In 1990 Commissioner Scrivener agreed to a motion by the European Parliament to conduct a full study of the economic consequences. The promise has been broken and no such study has been done. (Eurofacts 23/1/98). A family of four heading for a European holiday would face extra costs of GBP56. The Commission argues that duty free was incompatible with the single market although it is happy to preside over large variations in excise duties. (Daily Telegraph 27/2/98). The Government is wavering in its support for the abolition of duty free in the face of overwhelming public opposition and a fierce campaign by business and unions. The Financial Secretary said the UK would support a Commission study. (Daily Telegraph 7/3/98). The Duty-Free Confederation says EU rules on excise duties will be unworkable after 1 July 1999. The re-introduction of border controls may be inescapable. On a channel crossing sales for the first half will be at British duties and then French rates. A trip from Plymouth to Bilbao will involve four different rates of duty, including duty-free in international waters. The Confederation says the UK is reluctant to attract criticism of being anti-EU by advocating postponement of the abolition of duty-free. (FT 9/3/98). Stena Line, which relies on duty free sales for 30% of its revenue, is to seek a preliminary ruling from the European Court that the Treaty of Rome prevents the expansion of the EU’s taxation area to include international waters. (FT 30/6/98). A loophole in the law allows travellers to consume duty-free goods on the boat or plane (BBC R5 22/10/98). Duty-free sales for travellers within the EU ended on June the 30th 1999 after Tony Blair lost his battle to secure a reprieve for the travel perk.
Officials working for the EU enjoy duty-free purchases under the Vienna Conventions so they will be unaffected by the ban (S Telegraph 11/1/98). The Spanish Foreign minister, Abel Matutes, bought an aircraft tax-free while he was a Commissioner. (European 1/6/98). The annual duty-free allowances for Commissioners are as follows: 400 litres of wine, 90 litres of spirits, and 20,000 cigarettes. (D Telegraph 5/11/98). In addition to duty-free purchases, Commission employees can buy cut-price goods at the staff shop. This privilege is to be restricted (BBC R4 News 29/9/99). The Prodi Commission has decided that all Commissioners will voluntarily renounce several of the special provisions traditionally granted to them by the Belgian authorities in their application of the 1961 Vienna Convention on diplomatic relations. As a result, Members of the Commission: (I). Will not exercise their right to claim exemption from VAT and excise duties on wine and spirits, cigarettes and petrol. (ii). Will not exercise their right to purchase, free of VAT, a wide variety of items for personal use. (iii). Will limit themselves to the VAT exemptions that are available on items for personal consumption to Community Civil Servants for one year after they take up employment in Belgium for the first time. Members of the Commission will continue to accept diplomatic immunity and associated provisions under the relevant Convention and Protocol, limited to their acts in the course of their official function as Commissioners. The substantial changes agreed upon by the Commission today will not, of course, relate to people serving in other Community Institutions, or to the diplomatic services, or others who are currently covered by the provisions for people with diplomatic states in Belgium. .(Press Statement – 29 September 1999 By Neil Kinnock, Vice President of the European Commission)
Britannia Airways called the regulations for on-board sales after the duty-free ban crazy, stupid and an administrative nightmare. Carriers are allowed to stock up on goods in the country with the lowest excise duties. E.g. Spanish duty on whisky is a quarter the British rate. Carriers can only sell at that low rate when they are in the territorial waters of that country. If they move to another country then they must sell at that country's rate and claim back the original duty. A charter flight to Spain would involve three different national airspaces all with different excise rates. A ferry to Spain might have to take shelter in a Portuguese port so yet another rate would apply. The EC says it is up to member states to enforce these regulations. (D Telegraph 14/10/98). The regulations should have been subject to approval by the Council of Finance Ministers and the scrutiny of the European Parliament. The Commission chose to circumvent this process in order to avoid public debate on this fiscal chaos. It put the issue instead to the EU Excise Committee of member states, unelected fiscal experts, and suggested they agree behind closed doors. (FT letter 4/10/98)
Britain, France and Germany are concerned at the likely job losses from the abolition of duty-free sales and have obtained agreement for an economic review. A report will be presented in March 1999. (S Telegraph 13/12/98). European Commission experts have concluded that an extension of duty-free sales in the European Union will not save any of the jobs threatened by the planned abolition of the system next June, officials said Thursday. (AFP BRUSSELS, Feb 11 1999)
The market punished BAA, cutting its shares by 17.5p after the airports group said the damage to its profits from the abolition of European duty-free sales would be twice as large as expected. (FT 5/10/99)
Eurotunnel warned that ticket prices on its Shuttle service had to rise by because of the abolition of duty-free shopping for travellers between EU countries. Traffic fell because people were convinced that it was not worth crossing the channel anymore. (D Telegraph 21/10/99)