Confidence in HMRC hitting the planned November launch date is fast disappearing, as fears grow of inevitable ‘teething problems’ and the ensuing potential for disruption.
The HMRC declaration processing system CHIEF is one of the world’s largest and most sophisticated electronic Customs services of its kind.
However, it is nearly 25 years old and was due to be changed to meet new requirements under the EU Union Customs Code. Brexit has massive implications for HMRC and declaration processing, potentially adding 195 million additional entries, which means that it is now critical that its successor, CDS, is viable in good time.
The industry’s original understanding from HMRC was that a fully-functional version of CDS would be delivered in August 2018, thus allowing five months of testing before HMRC closed off the current CHIEF system.
Earlier in April HMRC released a ‘CDS Team Update’ in which they announced that the original launch of a fully-functional version of CDS in August 2018 was to be replaced by a three-stage release, commencing in August, with the second Import release in November and a third Export release at a date to be specified. In August only a handful of selected smaller importers will submit live data.
Feedback from the freight software community is that they find this latest announcement “hugely disappointing” because they cannot even begin to go live with CDS for imports until November and with CHIEF still scheduled to close to import entries at the end of the year the challenge to implement CDS across all users is that much harder.
Confidence in the forwarding community that HMRC will be 100% ready for November is fast disappearing, as teething problems will involve patches and there is clearly potential for disruption.
Our customers will not be impacted by potential CDS issues, as we will have access to the HMRC back-up system, while problems are resolved
The other implication is that Exports have been put to one side, until Imports has been completely rolled out, hopefully in November, which means that any CDS solution for Exports is now unlikely before 2019.
For all of HMRC’s talk about engagement with the forwarding community, a cynic might think that its principal concern is to be able to report back to its government masters that it has achieved the goal of CDS go-live within the originally planned timescales, principally as a box-ticking exercise.
And with the focus entirely upon Imports since this represents £34bn revenue to the Treasury, the fact that the forwarding community is being given inadequate time in the migration plan seems to be of secondary interest to them. CDS will need a whole raft of changes to accommodate EU declarations, which cannot be considered without even an outline agreement between the British Government and the EU on how movements between the UK and EU will be processed after our exit in 2020.