Export Control System (ECS) The Export Control System (ECS) is one of a range of EU initiatives being introduced to improve existing customs electronic processing by achieving write off for indirect exports electronically instead of relying on stamped paperwork. In addition the opportunity has been taken by the EU to request additional “Safety and Security” information, 24 hours in advance of loading. The Safety and Security information will enable risk profiling to be carried out to identify and stop terrorist atrocities. Background The present system of stamping paper “travelling Copy 3” documents as goods exit the EU is unwieldy and prone to error. The overall objective of ECS is to provide an electronic write off for the Indirect Export; VAT authorities in each EU Member State can then use official ECS information (write off) for evidence of export to support VAT zero rating and for audit purposes.     Export Control System functionality When ECS is introduced to the UK the current Travelling Copy 3 will be replaced with an Export Accompanying Document (EAD) which will have a bar coded Message Reference Number (MRN) that uniquely identifies the movement within the ECS system. The UK CHIEF system will advise the ECS of an indirect export and identify the intended Office of Exit, this will mean the current NES declaration will be enhanced to include the office of exit. Some Member States have already introduced ECS Office of Export functionality which means that EADs are being received in the UK as the Office of Exit.       IMPLEMENTATION OF ECS IN THE UK In the UK, ECS will be delivered in three phases, although phases 2 and 3 will be delivered together. Phase 1 - the UK operating as an Office of EXIT for indirect exports from other member states (OMS) went live in September 2007. This process is manual and requires the UK exporter to lodge a C21 to obtain clearance for the consignment, and to then send the EAD, supporting documents and the C21 entry details to NCH in Salford. Salford will then discharge the EAD electronically Phase 2- the UK operating as an Office of Export This is due for release in July 2009 and the process is currently being finalised. The original solution proposed by HMRC was a “super C21” that would be used to declare an entry, and also link by means of a document reference, the EAD. Latest thinking is that the document raised in the other Member State can be associated to a Master UCR and arrived and departed using the existing Inventory control systems at UK ports using the unique Message Reference Number, MRN, to identify the goods. Phase 3 - Full integration of ECS with pre-departure declarations and the implementation of the Safety and Security (S&S) Regulations is due for joint delivery with Phase 2 in July 2009. This will combine the safety and Security message with the declaration of the office of exit.       IMPACT Phase 1 and 2 Introduction of the ECS1 stages will negate the need for SAD Copy 3 (paper) documents with notifications of indirect exports being controlled electronically. Initial use of EADs, as a paper document, will be replaced through common messaging meaning that the MRN will identify the goods and declaration and will be obtained via electronic means, rather than as a paper report. Phase 3 (Safety &Security) Safety and Security arrangements may cause some changes to existing procedures. Export Summary Declarations (ESD’s) will apply to all exports not just indirect exports. However, due to the fact that elements of the specification for the data requirements were included in the specification for SAD Harmonisation it is perceived there will be minimal impact on trade systems. However the requirement for a safety and security message for all exports, even those that do not require a fiscal declaration, for example “low value” and “documents” raises the potential for significantly increased message volumes. HMRC have committed to continue to work with the UK trade representatives to address outstanding issues. Procedures need to meet legislative requirements and facilitate the export of goods by UK traders. Customs Information Papers detailing procedures for ECS 1(b) and 2 will issued when these issues are resolved. To enable the UK to meet the legislative deadline HMRC will deliver Phase 3 in two stages: • Stage 1 - To send the new ESD information to CHIEF to improve risk analysis and targeting. For indirect movements, messages to other EU member states will still be routed out via the ECN+ System • Stage 2 - To migrate to HMRC strategic common components in 2011.       CONSULTATION The final stages of implementation of the ECS project are being discussed regularly with the trade through the ICS/ECS JCCC sub-group. e-customs and Bell Davies have representations at these meetings. The UK also meets regularly with other EU member states at various EC committees to discuss possible solutions to harmonise customs controls across the EU.