Liz O'Donnell
Question:29 Ms O'Donnell asked the Minister for Finance the steps, if any, which are being taken to deal with EU transit fraud; and if he will make a statement on the matter. [9033/97]
Written Answers. - EU Transit Fraud.
I presume that the Deputy is referring to the Community Transit System, which is the documentary system for controlling the movement across Union territory of third country goods which have not borne import charges and for controlling the movement of Union goods, such as agricultural produce entitled to an export subsidy, which are being exported from the Union under customs control.
Concerns have been expressed at Union level about abuse of the system by criminals. A committee of inquiry into the system established by the European Parliament has earlier this year recommended various measures and reforms. Following extensive consultations, the European Commission is now finalising a package of measures — which will take account of the Parliament's views — to improve the workings of the system and to curb abuse and fraud. Its proposals may be presented in a report to the ECOFIN Council on 12 May.
The Community Transit System is currently paper-based. The volume of transit transactions, at some 15 million per annum, means that the system is extremely unwieldly and criminal elements have exploited this. There is general agreement at EU level that computerisation of the system would result in greater efficiency, and provide better control and fraud prevention. It is accordingly intended to fully computerise the system over the next three years.
Steps have already been taken to combat fraud in the system. For example, an alert system, early warning system, has been in place since September 1992 to ensure that customs officers concerned are warned about movements of high risk goods, such as cigarettes; since February 1996, guarantees are required for movements of high risk goods, to cover the full amount of duties and taxes at risk; and since March 1996 provision exists whereby customs can require consignments to take a particular route through the Union, so that movements can be monitored.
In its report to Council the Commission is expected to propose various further measures, including the electronic stamping of documents, so as to inhibit forgery, more stringent controls on access to the system, the extension of the early warning system, and the conclusion of memoranda of understanding between customs and the trade in order to promote greater co-operation between them in the fight against fraud.
I am informed by the Revenue Commissioners that very few cases of transit fraud have been encountered by Irish customs. This is because of the relatively low volume of transit operations commenced here and because there is little or no through traffic of third country goods through Ireland. However, we have contributed fully to deliberations at Union level to improve the workings of the system and the Irish Customs Service collaborates closely with the other member states and with the Commission's anti-fraud unit, UCLAF, to combat abuse of the system.