The Customs Handling of Import and Export Freight (CHIEF) — the UK’s existing electronic system for handling customs declaration processes — will soon be retired and replaced by the new Customs Declaration Service (CDS).
The closure of the CHIEF system (which has been in the works since 2019 but was delayed due to Brexit) is expected to be complete by mid-June 2023. The first phase of the transition process will begin in September 2022.
Anyone who imports or exports from the UK should be aware of the upcoming changes and have a plan to make the transition process as smooth as possible.
Here, we’ll provide an overview of what you need to know about the phasing stages from CHIEF to CDS.
What is the Customs Declaration Service?
The Customs Declaration Service (CDS) is a system that supports the import and export of goods into and out of the UK. It’s replacing the CHIEF system that has been in place since 1994, which can’t effectively handle the complexities of post-Brexit EU customs requirements.
The CDS system has been live since 2018, but the first big shift to mandatory usage of CDS is coming in late 2022* — a once-in-a-generation change that will challenge IT departments and customs brokerage processing teams throughout the transportation and logistics industry.
Because the two systems are not a one-to-one match, companies will need to adjust to CDS customs declarations’ new layout and format and plan for updates to software, training, and business processes.
Here are some of the key differences between CHIEF and CDS:
Customs Handling of Import
& Export Freight (CHIEF)
Made up of numerous components that exchange information end to end
Uses paper-based rules
Uses data processing rules
Uses EDIFACT messaging language
Uses XML messaging language
Requires different Custom Procedure Codes (CPCs) for different types of declarations
CPC is always the same, regardless of declaration
For a more detailed comparison between CDS and CHIEF, see this article from HM Revenue & Customs.
Transition dates to know
The CDS system is already up and running, and many companies have already made the switch. If you’re still using CHIEF, here are two important dates to keep in mind:
Given these closure dates, companies may continue declaring export declarations on CHIEF through March 2023, but all import declarations must be made via CDS after September 2022.Connecting disparate systems to streamline the transmission of information
- 30 September 2022: New import declarations will close on CHIEF.
- 31 March 2023: New export declarations close on CHIEF / National Exports Systems.
How to prepare for the Customs Declaration Service transition
As with any change to existing processes, the switch to CDS may cause slowdowns, higher stress levels, and increased paperwork errors — which can negatively impact KPIs and customer experience.
Luckily, there are some steps you can take to make sure you’re not overwhelmed when the deadlines roll around:
- Have your EORI ready. You’ll need an Economic Operator Registration and Identification (EORI) number tied to your declarations to use the CDS system.
- Register for CDS. Use your Government Gateway account details to register for CDS. If you don’t have a Government Gateway account, you can create one.
- Coordinate with your software provider. If you use third-party customs software, your provider should already be in the process of updating your application(s) to be compatible with CDS. Once preparations are complete, you’ll need to coordinate with your provider to ensure they’re authorised to make declarations on your behalf in the CDS system.
- Train your team on what’s changing. As we learned with Brexit, adapting to new and unfamiliar paperwork is a challenge for freight and logistics companies. The layout and format of CDS declarations are different from CHIEF declarations and require different codes and procedures, so agents will need additional training to prevent costly errors. Reference UK Trade Tariff: volume 3 for CDS for guidance.
- Prepare for a capacity crunch. Many organisations will need additional support to reduce pressure on agents and maintain performance during the transition period. Hiring more in-house staff is an option, but it’s often costly, time-consuming, and not scalable. You may want to consider partnering with a business process outsourcing (BPO) provider who can key data and/or QA before submitting declarations. That way, you can quickly scale up or down as needed.
Making a last-minute switch from CHIEF to CDS without the proper preparation could wreak havoc on your business processes and cause unnecessary stress for agents and clients alike.
To recap, be sure to do the following ahead of the upcoming deadlines:
- Complete your CDS registration (if you haven’t already)
- Coordinate with your software provider
- Familiarise yourself and your team with new procedures
- Decide how you’ll manage your team’s capacity during the transition period
Adjusting processes is never easy, but with the right planning and support, you can adapt to CDS, continue to serve your clients, and protect your bottom line.
*CDS declarations have been mandatory for all imports into Northern Ireland since October 2021.
Looking for a strategic partner to support your transition to CDS? Contact us.