Refusal in favor of the state is one of the types of procedures carried out at customs (previously - regimes), which are provided for by the Customs Code of the Customs Union. The declarant places the goods under this procedure on a voluntary basis. Read more about this in the article.
Customs Procedures
Any customs procedure means the method of use and disposal of products, which is chosen by the declarant. The latter moves goods across the border under one of them and can change the procedure subject to the established conditions. In a particular mode, the status of the product or vehicle is determined. In this case, the rights and obligations of the participant in foreign economic activity are established in cooperation with the relevant customs unit.
Legal regulation
To understand the customs procedure in question, it is recommended that you familiarize yourself with the following legal standards:
- Articles 302, 310 and 311 of the Customs Code of the CU (chapter 43).
- Art. Art. 299-302 of the Law on Customs Regulation No. 289-FZ.
- Commission Decision TC № 375.
- Articles 187 and 300 of Law No. 289-FZ.
- Appendix No. 2 to the Order of the Federal Customs Service No. 357.
- Chapter 3 of the Annex to the Kyoto Convention on the simplification and harmonization of customs procedures.
Key Points
Refusal in favor of the state is a customs procedure consisting in the gratuitous transfer of goods of foreign production into the ownership of a state that is a member of the CU. In this case, the company does not need to pay duties and tax fees. Non-tariff regulation measures are also not used. Various foreign-made goods may be placed under the procedure in question, except for those that are forbidden to be brought into the territory of the Customs Union and put into circulation. Also, products cannot be placed in respect of which the use of the procedure entails expenses that are not subject to reimbursement through its sale, including goods with an expired shelf life.
In accordance with the Classifier of types of procedures, the code "94" is assigned to the refusal in favor of the state. The customs procedure is governed by Ch. 43 TC TC, as well as Ch. 32 of the Law on Customs Regulation No. 289-FZ. It can be used in the exhibition business, since the price of return transportation is sometimes more expensive than the purchase of stands and other equipment for advertising. This encourages owners to transfer goods in favor of the state.
The need to apply the procedure in question is associated with delays in transportation, as well as fines imposed by carriers. As a result, the cost of goods for the purpose of their sale should be increased by an order of magnitude compared to existing prices in the market. Thus, calculations can show the feasibility of abandoning the product, as this will lead to lower losses than its sale.In addition, an appropriate transfer to the state can have a positive effect on the business reputation of the company.
The sale of goods becomes the task of government agencies that transfer them to trading enterprises or organize auctions. Some products are also used for charity. They are transferred to social support agencies, as well as to nursing homes and children. The corresponding procedure is applicable to those goods that were lost due to force majeure or due to accidents.
Foreign goods
The goods that the declarant can place under refusal in favor of the state (a customs procedure that allows to reduce costs, as we found out above) include the following:
- Not placed under any mode.
- Placed under such regimes as trade without levying duties, processing in the territory of customs or for domestic consumption, as well as access and storage.
- Transported across the border by diplomatic missions, consulates and other official missions of states, international organizations, their personnel, as well as those required for personal use by certain categories of foreigners who enjoyed privileges and / or immunity, in accordance with international agreements in force in our country.
Principles
When goods are placed under the refusal procedure, the declarant immediately loses ownership, while a country that is a member of the Customs Union, on the contrary, appears. The following principles are characteristic of a failure:
- Material benefits. It means that the procedure can be refused if the proceeds from the sale do not cover the costs or if the sale is impossible or limited.
- Immunity of the new owner. This protects the state from making claims by others. This principle is that the legal responsibility for the legality of the disposal of goods lies with the declarant, and property claims are not reimbursed by customs.
- Special principles. These are: a ban on changing the procedure in question to some other one, the state’s benefits from the application of refusal, as well as the exemption of customs from meeting the requirements of third parties regarding property.
Filing a declaration
Current legislation does not clearly regulate the issue of the possibility of placing goods under refusal in favor of the state. In the customs procedure, it is necessary to eliminate the gaps, since in addition to auctions, other methods of selling goods are also used.
Legal regulation is based on a permitting principle. To obtain appropriate permission, the declarant should submit an application or cargo declaration (FCS).
When submitting an application, customs nevertheless draws up a declaration for statistical purposes. The addressee is the head of the customs unit or his deputy, who has the right to give permission to place goods under the customs regime (or procedure). The statement contains the following information:
- Product Name.
- Individual characteristics.
- Amount.
- Reasons for refusal.
The authorized person signs the declaration, puts a seal and writes: “Refusal allowed.”
Failure of the customs authority
In certain cases, the customs is obliged to refuse such a procedure. This occurs when submitting a declaration for the following products:
- Which are forbidden to import into the territory of the vehicle.
- Which are issued for the purpose of free circulation or declared for re-import.
- Armaments, related equipment, ammunition, RKK, military communications systems, drugs, poisons, radioactive waste, explosives, electricity and some other substances.
Other goods that cannot be placed under the customs procedure of refusal in favor of the state may be included in the list.Customs officers have the right to act at their own discretion if they consider that there are “sufficient grounds” for making an appropriate decision.
If the refusal is allowed, the declarant is obliged to deliver the goods to the place determined by the customs, and at his own expense.
Act of transfer
The content of the customs procedure for refusal in favor of the state includes the act of transfer, which confirms the change of ownership. This paper is a strict reporting document. At the request of the declarant, it can be made in duplicate. One copy is transferred to the former owner.
The act shall contain the following information:
- Date of preparation.
- The name of the company that transferred the goods.
- The name of the body that received it.
- Name, individual characteristics and quantity of goods transferred. The act is certified by signatures and seals of the parties.
Features
The procedure has several features. The characteristic financial conditions for placing goods under the customs procedure of refusal in favor of the state include the declarant's right to demand a refund. They are as follows:
- Only those amounts that are deposited to customs are returned as security for various customs payments.
- Import duties, VAT, and excise taxes that were paid during the re-export and processing procedures at the customs territory are returned to the declarant.
- The amount of export duties paid during the processing procedure outside the customs territory is also returned.
- The previous owner has the right to count on receiving money for export duties that he paid while placing the goods under the appropriate procedure, as well as temporary export, unless they were actually removed from the territory.
- However, import duties, like VAT, excise taxes on goods that were temporarily imported and then placed under the refusal procedure, are not refunded.
- All goods that are placed under waiver in favor of the state become federal property.
Customs clearance
Appropriate clearance takes place at the customs authority of a subdivision of a country that is a member of the Customs Union, unless otherwise provided by law. For this purpose, the declarant should submit a cargo declaration or statement. In the latter case, the customs official transfers the information contained in the application to the cargo customs declaration. This is done for statistics. The permit is issued by the head of the customs unit or his deputy. But the mortgagor does not need to submit a declaration or application if in the pledge agreement he declared the placement of goods under the appropriate customs regime.
Goods are made out at the customs office of the region where they are located. In this case, an inventory is carried out.
Goods are transferred to federal ownership, according to the act of transfer. Immediately after the transfer, they receive the status of goods that are in free circulation at customs. From this moment they are considered free from various prohibitions and restrictions in terms of use and disposal.
Property that is in state ownership is transferred to the Federal Property Fund for the purpose of accounting, valuation and sale. For this purpose, the customs authority shall notify the Fund or the territorial executive authority of the location of the relevant property. For the transition procedure, the act of transfer is drawn up again. If the document does not specify the book value, then the authorized body must make an assessment within a month from the date of transfer.
customs control
The order of refusal of goods in favor of the state without fail includes their inspection. At the request of the official, the declarant (his representative) or another authorized person must be present. As a result of the inspection, an act is drawn up.If during the inspection it turns out that the goods do not meet the terms of the release, which are provided for by Art. 149 of the Customs Code, then release is not carried out.
The act of transfer is executed on the same day as the release of goods. Its basis is the act of inspection. It is signed in triplicate, two of which are attached to the customs declaration, and the third is transferred to the person who was the previous owner.
Goods placed under the customs procedure for refusal in favor of the state are recorded on the off-balance account of the customs unit that performed the clearance. The basis for registration is the act of transfer, as well as the customs declaration. The procedure is carried out within three days after registration.
Conclusion
Refusal in favor of the state is a customs procedure, which occupies a separate place in the legislation on customs. It is not always easy to determine how attractive such a regimen is. At first glance, it may seem pointless and useless for a commercial company. The general characteristics given in the Customs Code of the Customs Union are detailed in the provisions that are approved by orders of the State Customs Committee of the Russian Federation.
Basically, the procedure in question is used in the exhibition business. This is the case when the customs payment system is built in such a way that the cost of return transportation is higher than the price of stands, equipment for advertising and individual exhibits. This is the reason for their transfer to state ownership or destruction.
The exhibitor simply does not have the right to leave goods at customs, as importation into the territory of the Russian Federation was accompanied by a corresponding obligation to export it. In this case, the company must pay the necessary duties and tax fees. But in order not to take out the goods legally, the declarant has the right to execute such a procedure considered in the article as a refusal in favor of the state. Then he will not have to pay any duties or fees.
An alternative to this is the destruction procedure. It applies to goods whose use at the customs of Russia is impractical and disadvantageous.
In case of refusal in favor of the state, foreign goods are transferred free of charge into state ownership, and the declarant immediately ceases to be their owner. At the same time, he retains responsibility for claims from third parties, while the state is exempt from it.
