STANDARD TWINNING PROJECT FICHE
1. Basic Information
1.1 Programme: IPA 2007
1.2 Twinning Number: HR 07 IB FI 01
1.3 Title: Development of the Customs Laboratory
1.4 Sector: Internal Market and Trade
1.5 Beneficiary country: Republic of Croatia
2. Objectives
2.1 Overall Objective(s):
Support the Croatian Customs Administration (CCA) Business Strategy in order to maximise collection of customs duties and taxes by establishing nature, tariff classification, origin and value of good, provide support for the prevention of illegal traffic of goods and to prepare CCA for the administration of EU CAP.
2.2 Project purpose:
Providing assistance to the Croatian Customs Administration (CCA) in development of the Customs Laboratory to realize the operational capacity in compliance with the EU requirements resulting in improved legal basis, management policies, analytical methods, training programs and working methods, required to perform the wide range of responsibilities in line with the EU best practice.
2.3 Contribution to Accession Partnership/ Stabilisation and Association Agreement/ National Programme for Integration of the Republic of Croatia into the EU (NPIEU)
The revised Accession Partnership with Croatia of February 2008 lists the following priorities for the Chapter 29:
- Continue to adopt legislation in the limited remaining areas requiring further alignment, in particular on non-preferential rules of origin and the application of fees.
- Apply customs rules in a consistent and homogeneous manner throughout customs offices, notably in the areas of declaration processing, origin, simplified procedures, counterfeiting and selectivity of controls; ensure the application of modern and consistent risk analysis procedures in all offices.
The strengthening and modernization of the Customs Laboratory is set as one of the priority objectives of the Business Strategy of Croatian Customs Administration (CCA) that will contribute to uniform implementation of customs and excise regulations and better protection of future EU external borders and internal market.
3. Description
3.1 Background and justification:
The basic act regulating customs procedures in the Republic of Croatia is the Customs Act (OJ 78/99, 94/99, 117/99, 73/00, 92/01, 47/03,140/05, 138/06, 60/08) which has been largely harmonized with Council Regulation (EEC) No 2913/1992 establishing the Customs Code, and its amendments. Articles 80 to 85 of the Customs Act (corresponding to articles 68 to 73 of the EU Customs Code) regulate the possibility of taking samples in order to check the accepted declaration. The Regulation Implementing the Customs Act (OJ 161/03, 69/06, 05/07, 70/08) in its articles 149 to 158 regulates the procedure of taking samples, writing a report, quantity of goods needed to be taken as a sample, proceedings with samples after analysis, costs of the analysts etc. Particularly, article 155 item 1 of the Regulation states that Customs Houses should send samples of goods along with the copy of the report on taking samples to a Customs Laboratory for analysis. Item 2 of the same article allows the possibility of taking analysis in similar referent institution, if the Customs Laboratory is unable to perform the analysis.
With the signing of the Stabilisation and Association Agreement (SAA) in October 2001 and the submission of the membership application to the European Union in March 2003, the Government of the Republic of Croatia demonstrated a strong commitment to the EU integration process. Following the positive Opinion of the European Commission[1] in April 2004, Croatia became a candidate country to the European Union on 18 June 2004. In its Opinion the European Commission examined under Chapter Customs Union the current and prospective situation in the customs area with a brief assessment of Customs Administration’s ability to assume the obligations of membership in a medium-term. The Opinion highlighted that further efforts are needed to align customs legislation with the acquis and to effectively implement and enforce it in the medium term. Especially the administrative capacity needs to be assessed. Particular attention needs to be given to the modernization and strengthening of the customs administration by providing, amongst others, sufficient budget, IT and human resources, as well as further training to cover the whole range of customs issues, including those which are accession related.
Following the exchange of the negotiation positions at the second session of the Intergovernmental Conference, held in December 2006, negotiations were opened on Chapter 29 - Customs Union. Throughout the negotiations the European Commission continuously observed the progress Croatia was making in alignment of customs regulations with the acquis, application of its customs rules in a consistent and homogeneous way across its customs offices and in developing all the related IT interconnectivity systems. During this process the Commission found that Croatia meets all benchmarks set for provisional closing of negotiations in Chapter 29.
A Customs Laboratory is responsible for performing analysis of the samples of imported and exported goods and samples produced in post-clearance procedure, excise procedure, offence procedure and other customs related business. Each laboratory is assigned to one specific territorial area, operating independently. The Rijeka Laboratory analyzes samples of goods coming from Istra and Kvarner region. The Split Laboratory is in charge of making analyses of goods from Dalmatian region while the Zagreb Laboratory, as a central and the largest one, since the volume of work in Zagreb is considerably larger than in other customs laboratories, analyzes samples from Zagreb, central and northern parts of the Republic of Croatia. The main task is to carry out the analyses of goods related to tariff classification, control measures on foreign trade and duties. Authorized customs officers perform chemical-technological examinations of samples, classification in customs tariff and write analytical reports (mostly graduated engineers of chemistry or technology). At the moment, this laboratory is physically located in the building of Customs-House Zagreb and is staffed with 6 chemists with University degree and one staff member in charge of administrative tasks. The current organization envisages 10 people of different expertise. The future organization envisages 19 staff members.
Laboratory staff performs chemical and technological testing of samples of high variety of goods, classification in customs tariff and prepare analytical reports. Analytical reports contain description of samples, performed analytical procedure, tariff number and legal base for classification. Analyses[2] are performed in laboratory with insufficient equipment in comparison to the requirements of Customs Tariff. The services of other specialized laboratories and scientific institutions are outsourced when is not possible to perform analysis due to lack of adequate equipment. This refers to analysis of e.g. metal, wheat, caffeine contents, some testing on petrol products, sugar, etc. This practice of outsourcing is faced with a number of difficulties mainly because the available external laboratories are dealing with particular types of goods concerning their quality and safety characteristics, but not their identification and tariff classification. An analytical institution which performs required specific analyses of the goods the customs is dealing with does not exist.
The European Commission’s Opinion - AVIS (COM 2004 257) on the Republic of Croatia’s application for membership of the European Union of April 2004 calls for the existing Customs laboratories to be upgraded to make them compatible with the EU requirements. As regards the current situation in terms of laboratory staff, equipment and needed premises, the Twinning Light project “Strengthening of the Customs Laboratories System in Croatia”[3], which finished in April 2007, determined that the premises, human resources and the infrastructure of the current laboratory system are clearly insufficient. Current staff situation merely covers all the needs required by the job description and current staff number will not be adequate to satisfy needs of operating under the EU requirements. The existing equipment is modest, partially out of date and insufficient in the type and number. As such, it can not meet the requirements of customs tariff, methods, standards and norms established by the EU. Within the framework of the mentioned project, a detailed list ofthe needed equipment, respecting the work techniques and methods, types of analysis and types of goods analyzed, has been produced. Due to the high complexity degree of the tasks developed by Customs Laboratories, and taking into account the cost of the acquisition and maintenance of the analytical instruments needed in any modern laboratory and the geographical dimension of Croatia, the twinning partner of the abovementioned twinning considered convenient to boost one of the laboratories actually existing.
As regards the CCA, new responsibilities after the accession to the EU, related to trade facilitation on one side and the enforcement and security functions and control of the external border on the other side, will increase the role of the Croatian Customs Laboratory and will lead to the necessity of strengthening operational capacities of the Customs Laboratory in order to become capable to perform analyses of samples within the frame of the Common Agricultural Policy, refunds control on export, provide technical support for the implementation of the excise legislation, as well as technical and scientific support for the control of dangerous materials, controlled substances, etc and to determine classification according to the tariff and statistical nomenclature. In order to respond to this challenge, it is required to develop a Central Customs Laboratory in line with the European and national legislation, international achievements in the area and to equip it with appropriate analytical instruments to fulfil current and future requirements and objectives.
Due to the abovementioned, the CCA made the decision to organize and develop a Central Customs Laboratory located in Zagreb as a key support function for the improvement of the customs control that would assume all the activities generated by all the Customs Offices in Croatia. Other two existing laboratories in Rijeka and Split will be gradually transformed in departments for customs tariff, value and origin of goods.
The Central Customs Laboratory, as a single analytical centre for the chemical control of the goods related to the foreign trade, CAP and excise duty, will become even more important upon accession, when the Republic of Croatia’s borders will constitute new external frontier of the EU. To achieve that, it would be also necessary to provide the laboratory with all the resources for a correct development of the activities required for a laboratory of these characteristics. In this view the future organisation of the Central Customs Laboratory envisages 19 staff organised in 4 separate sectors. Those are Sector for wine, alcohol, beer and other alcoholic beverages, Sector for agricultural and food products, Sector for oil and hydrocarbons and Sector for industrial products.
The main duties which must be carried out by the Central Customs Laboratory will be the following:
- Technical management and coordination activities carried out in different Customs Laboratories. At first, there will be a Central Customs Laboratory in Zagreb.
- Issuing of analysis and physical – chemical evaluation reports related to the activities of control carried out by the Croatian Customs Authority and elaboration of the corresponding evaluation reports.
- Carrying out of chemical – technical studies for products and productive processes under the Foreign Trade regulations, Common Agricultural Policy, analysis of drugs and sensitive substances or excise duties.
- Elaboration of criteria for extraction, handling, presentation, storage, treatment and analysis of samples.
- Studies on the control of dangerous chemical substances, drug precursors and other products under specific regulations.
- Consulting tasks for the inspection units and services, research and intervention, as well as other tasks within the Customs Services of Croatia
- Consulting and analytical control derived from the agreements with other National Public Administrations or community bodies.
In this perspective, taking into account the demands of timely and dependable customs laboratory services, and lack of essential and sophisticated equipment, this project aims at supporting the CCA in development of the Central Customs Laboratory both from functional and operational perspective, in accordance with the EU standards and guidelines, thus supporting the enforcement of the Customs legislation and the improvement of the operational capacity of the customs service, and increasing the cooperation and exchange of information with relevant institutions at the national and EU level.
In parallel to this project a supply component, namely the sub-project 2 “Supply of equipment for the National Customs Laboratory Network”, will be implemented. The main purpose of this project is to supply the Customs Laboratory with analytical equipment required to perform full range of duties and provide laboratory staff, which will operate with the new equipment, with adequate training. This Twinning project (sub-project 1) should ideally start in parallel or slightly after the delivery and installation of equipment purchased under the sub-project 2 and it will assist laboratory staff in different aspects related to operation with the new laboratory equipment.
3.2 Linked activities (other international and national initiatives):
CARDS 2003 “Strengthening of the customs laboratories system in Croatia” - Twinning Light Project[4]
The specific objective of the project was to strengthen the customs laboratories’ structures to manage change and innovation, including strategic planning and reporting, communication and human resource management, necessary to upgrade skills on a broad basis required for a successful implementation of the EU norms and standards. One of the key outputs of the project is the Feasibility Study which deals with current organization, locations, human and infrastructural resources of the Croatian customs laboratories and provides recommendations and proposals for the best solutions with regard to accession to the EU and related requirements for the customs laboratory work. Project started in October 2006 and finished in April 2007.
CARDS 2004 twinning project “Modernization of Customs Administration in view of preparing for the Integrated Tariff Management System (ITMS)”
This 24-month project, which ended in November 2007, provided assistance primarily in the EU Customs tariff related areas: classification, valuation of goods, binding tariff information, EU customs procedures with economic impact, EU simplified customs procedures (others than Community transit), quotas and surveillances, preferential agreements, market originations and other agricultural legislation, anti-dumping and countervailing duties, EU non-tariff measures etc. It also contributed to further legislative alignment, training of staff and increasing the capability of the Customs Directorate to manage the implementation of the new procedures in the EU Customs Tariff related areas.