Sanctions: what does Customs do?

Article | 10-10-2022 | Web editor

From European legislation to customs practice

The sanctions of the European Union (EU) are transposed into Dutch laws and regulations via the Sanctions Act. This is done by the Ministry of Foreign Affairs, our client for this task. Customs ensures that the sanctions work in practice, by supervising, among other things, the import, export and transit of goods that are subject to a sanction. We ensure that the sanctions are complied with in practice by checking whether goods that (in this case) go to or come from Russia, Belarus, Donetsk and Luhansk are covered by the sanctions measures. This way, we contribute to ensuring that the sanctions are actually complied with.

Selection for checking with profiles

The first step in checking is to translate sanction measures into profiles. These are a kind of descriptions of characteristics in systems. For example, if good x comes from country y, a signal must be given. These systems process information about goods automatically. This includes data on, among other things, the type of goods, the destination and the country of origin. This information comes from, among other things, declarations that must be made during import and export. When the system gives a signal, we open the shipment or cargo. Possibly after a scan. We often check the documents first. We also do this if it is not clear exactly what is inside.

So the profiles help us select for a more comprehensive check. If the goods come with a permit, Customs will check it. And if we need to, that is, if something is really sanctioned or if there is no permit when there should be, we will stop a shipment. This way, we contribute to ensuring that the sanctions are actually complied with.

We do this mainly in the port of Rotterdam and at Schiphol Airport, where a large part of the international trade flows enters the country. In most cases, we check in the port of Rotterdam because we suspect that the container contains, for example, so-called dual-use goods. These are products or materials that can not only be used ‘normally’, but can also be used for military purposes. Sanction products that are particularly closely monitored at Schiphol are high-end computer equipment, luxury goods and high-quality components for industrial production.

Permit for sanction product

Sometimes, a permit can be requested for something that is subject to a sanction. If this is granted, you may import or export. Customs assesses the permit applications. In practice, there are currently few things for which you can submit a permit application. One of the exceptions: goods for space programme collaborations. Customs also ensures that the application for and approval of permits for the export and transit of relief goods for Ukraine runs smoothly and quickly.

Sanctions on services

Sanctions mainly concern goods, but to a small extent also services, including technical services. For example, someone who knows everything about a certain weapon and goes to Russia to train people to work with it. We also check for that. Not at the border, but at the companies themselves. We carry out checks at companies that can provide this type of service to Russia. For example, by checking the administration.

No punishment, but punishable

EU sanctions are not punishments. They do impose certain obligations on citizens and companies that trade with these countries. Violation of the Sanctions Act is a criminal offence, an economic offence. Customs checks whether citizens and companies comply with the Sanctions Act. Under the direction of the Public Prosecution Service, we investigate violations. An important part of these investigations is providing information about sanctions legislation.

Of course, we also provide information to prevent companies from (accidentally) violating the Sanctions Act. The Netherlands Enterprise Agency (RVO) is responsible for much of the communications with the business community. For customs-specific matters, Customs uses dutchcustoms.nl. It also informs the business community via the Customs Business Consultation.

A lot of trade with Russia

Before the sanctions, the Netherlands traded with Russia quite a lot. In 2021, our country imported 18.4 billion euros worth of Russian goods, 90% of which is petroleum and petroleum products. In addition, mainly Russian iron and steel are imported. At 6.6 billion euros, exports to Russia are a lot less. This mainly concerns machines, electrical appliances and chemical products. But in the end, about 3,000 Dutch companies feel the impact of the sanctions. The Netherlands does not trade much with Belarus, and not much at all with Donetsk and Luhansk.