What is indirect representation?
In indirect representation, the customs representative makes declarations in his own name but on behalf of the principal.
Indirect representation
With indirect representation, a customs broker makes a declaration in his own name, but on behalf of the interested party. This means that the customs agent acts as indirect representative, is the declarant, and is therefore (co-)liable for the customs declaration.
In this form of representation, the customs broker handles the declaration in his own name, but on behalf of the principal. Indirect representation is not allowed for placing goods under the following special arrangements:
- Inward processing
- Outward processing
- The Special Purpose Scheme
- Temporary entry
In the Netherlands, indirect representation between two companies established in the Netherlands is not common. This form of representation is used, for example, when goods have to be imported into the Netherlands, but the person who wants to declare the goods is not established in the Netherlands. In principle, both the customs agent and the principal are responsible for the customs and/or tax consequences of the declaration. If a declaration results in a customs debt, for example when goods are released for free circulation, both the customs forwarder and the principal are liable for the import duties and other taxes
upon importation.
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Roles and obligations in Indirect Representation in customs matters
| Indirect representation | Entry | Output | Condition |
|---|---|---|---|
| Declarant (Declarant) | Mandatory | Mandatory | Must be equal to Representative |
| Representative (Agent) | Mandatory | Mandatory | Must be equal to Declarant |
| Scheme Holder (Importer). | Mandatory | Mandatory | May not be equal to Declarant |
| Exporter | - | - | Must be based in the EU |
| Consignee (Consignee). | Mandatory | Mandatory | |
| Payer (Payer) | Optional | - | |
| Surety counter (Surety) | Optional | - |
How the various parties in the declaration are shown in your system depends on the solution your software vendor has chosen for this purpose.
What is the difference between direct and indirect representation?
At direcat representation the customs broker makes the declaration in the name and on behalf of the interested party. This means that the interested party is the official declarant and therefore fully liable for the declaration and any errors or problems that occur in the process.
At indirect representation the customs broker makes the declaration in his own name, but on behalf of the interested party. In this case, the customs forwarder himself is the official declarant and therefore (co-)liable for the customs declaration. This means that in case of errors or problems the responsibility is shared between the customs forwarder and the interested party.
Frequently asked questions about indirect representation
Who is liable in indirect representation?
Both the representative and the importer/exporter (principal) are liable for obligations arising from the customs declaration, such as payment of import duties, VAT or penalties for errors.
When is indirect representation used?
This often occurs when the principal is not based in the EU. In that case, the representative can take care of the formalities, but is also co-responsible.
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