EXPORTING TO EU COUNTRIES VIA FRANCE
The Single Point of Clearance is when an overseas company not established within the European Union chooses France as the single point of entry of all its DDP shipments to various EU countries.
The customs clearance of the parcels will be carried out exclusively in France before the final delivery of the goods in each EU country like France, Belgium, Germany, Italy, Spain, Portugal, the Netherlands, Luxembourg, the United Kingdom where Union law remains applicable until the end of the Brexit transition period, Ireland, Finland, Sweden, Denmark and so on.
Who can use the “Single Point of Clearance” in France ?
This consolidated customs procedure would be suitable for overseas manufacturers, suppliers of small high-value products, wholesalers of branded products, non-EU online retailers shipping goods to the fulfilment centres of French e-commerce websites (such as Amazon.fr or Cdiscount.com) for subsequent distribution across the European Union, UK businesses exporting to the EU after Brexit (except for shipments to the Republic of Ireland) and any other international business selling goods to EU based customers under DDP sales terms.
The international commercial term (INCOTERM) known as DDP terms or Delivered Duty Paid is a delivery agreement whereby the foreign seller assumes the entire freight costs, including the responsibility of paying import duty and VAT at the destination port in the EU. The DDP terms are very attractive for the buyer and help the supplier to win new sales opportunities.
Since the implementation of the “Single Point of Clearance” often (but not always) requires the registration of the foreign company for VAT purposes in France, the appointment of a French tax representative like Corintax® will be mandatory for non-EU companies (including UK companies after the Brexit transition period that will end on December 31, 2020). We would also like to emphasize the fact that the customs scheme described here is possible only when some key conditions are fulfilled :
- The overseas seller files an application to get an EORI number in the European Union;
- The goods shipped to EU countries are intended for sale (there should be a transfer of ownership);
- The customers in the EU are VAT registered, or they place their orders through an online marketplace;
- The goods shipped to EU countries are cleared for customs in France (e.g. in Calais, Le Havre, Paris Airport);
- The proof of delivery (CMR document or Air WayBill) should be collected from the carrier or freight forwarder.
It is strongly recommended to non-EU companies willing to choose France as their Single Point of Clearance in the EU to find in a first stage a freight forwarder who can handle the customs clearance in France before contacting Corintax® for fiscal representation (VAT registration in France, preparation and submission of VAT returns, INTRASTAT declarations, etc.) and VAT reclaim service.
What are the advantages to opt for the “Single Point of Clearance” ?
Non-EU companies having occasional or regular shipments to EU countries can choose France as the Single Point of Clearance of their goods and take advantage of the following benefits:
- Claiming back import VAT paid in France or using an import VAT deferment account;
- Offering to corporate clients (including retailers and distributors) a sale price without VAT;
- Not paying import VAT in multiple EU countries where it would be difficult or very long to reclaim it;
- Sending consolidated shipments to multiple VAT registered customers located in various EU countries.
It should also be noted that the storage of goods in a French warehouse is not compulsory, although it is recommended to ensure better delivery times. If the foreign importer does not opt for a storage solution in France, the consignments can endeed be redirected to their respective destinations in the European Union immediately after customs clearance at a French port or airport.
Would you like to set up a “Single Point of Clearance” in France ?
Our fiscal representation service in the framework of the procedure described above is currently available only for companies based outside the European Union.
Years bring experience to sincere minds.
Alphonse de Lamartine
The content published here above is based on information timely as of the date of publication, unless otherwise indicated. Amendments to the tax laws in the EU country covered here could have been passed recently. Therefore, readers should contact Corintax Consulting for further insights.