Ukrainian business is among the first 20 countries out of 36 countries of the Convention on a Common Transit Procedure to start using the NCTS (New Computerized Transit System) Phase 5, the Ministry of Finance reported on its website on Wednesday.
“Ukraine had 1.5 years less time to develop NCTS Phase 5 than other Convention countries, and also started this process during the work of the Evaluation Mission before joining the family of Convention countries on October 1, 2022. Despite the full-scale war, Ukrainian government agencies, thanks to the constant support of international partners, in particular the EU Public Finance Management Support Program in Ukraine (EU4PFM), have ensured that Ukrainian businesses can operate in the latest version of the NCTS since April 22 this year,” the statement said.
The Ministry of Finance summarized that since the beginning of Ukraine’s accession to the “customs visa-free regime”, the dynamics of issuing declarations in the common transit procedure continues to grow: to date, the State Customs Service has issued more than 100 thousand NCTS declarations, of which 21 thousand were issued in 4 months of using NCTS Phase 5.
The Ministry recalled that the Convention countries began developing and transitioning to NCTS Phase 5 in March 2021.
In the same year, Germany started using it, and in 2023, 13 more countries (Slovenia, Spain, Luxembourg, Croatia, Switzerland, Denmark, Bulgaria, Latvia, Italy, Ireland, Finland, Estonia, Czech Republic) made the transition.
It is noted that in the first half of 2024, Ukraine, as well as Norway, Sweden, Serbia, Romania, and Cyprus, joined the list of countries using NCTS Phase 5. In July 2014, the UK and Slovakia started using NCTS Phase 5. Another 15 countries (Lithuania, Austria, North Macedonia, Poland, the Netherlands, France, Turkey, Portugal, Malta, Greece, Hungary, Andorra, Belgium, Georgia) plan to complete the transition to NCTS Phase 5 by the end of 2024.
The electronic transit system NCTS (New Computerized Transit System) Phase 5 will be applied from December 1, 2023, the State Customs Service of Ukraine reported on Telegram on Monday.
“Ukraine continues to confidently prove its ability to fulfill the obligations undertaken when joining the Convention on the Common Transit Procedure: from December 1, 2023, we plan to switch to the use of NCTS Phase 5,” the agency quoted Deputy Head of Customs Vladislav Suvorov as saying.
Earlier, on August 17, the State Customs Service announced the postponement of the start of NCTS Phase 5 for two months (until November 1) to give businesses more time to prepare for the new system and requirements for filling out transit declarations.
At the time, the agency indicated that the transition to NCTS Phase 6 is scheduled for June 2025.
“Despite the military actions, we not only met the deadline, but will also help other countries to pass international testing (Mode 3),” Suvorov said.
According to the National Coordinator for Common Transit, Alina Brendak, the new system is currently being tested with brokerage software developers. She emphasized that NCTS Phase 5 will interact with companies through brokerage software, and the current “Trader’s Portal” will no longer be used.
The State Customs Service noted that in Phase 5, companies will have the opportunity to detail information about goods at the level of house consignment notes (the so-called House Consignment level), which is relevant for consolidated cargo.
In addition, it is noted that the agency will develop new guidelines for companies on entering information in transit declarations, taking into account the specifics of NCTS Phase 5. At the same time, all the rules and principles of common transit and transit simplifications remain relevant and in force.
The State Customs Service is also working on the possibility of providing businesses with an alternative tool for filling out and submitting transit declarations and interacting with the national electronic transit system NCTS Phase 5 – an IT solution similar to the current “Trader’s Portal”, the release said.
As reported, in January 2023, the State Customs Service published specifications for software updates by brokerage software developers (bit.ly/3NwC9pk). In August, national developers were granted access to the ARI to test messaging with NCTS Phase 5. The State Customs Service says it is actively working with the relevant teams to ensure the readiness of brokerage IT solutions.
NCTS is one of the 17 customs IT systems that Ukraine has to implement to join the EU, and so far the only one implemented by Ukraine. The implementation of the IT system involves not only its installation but also its synchronized development together with other countries party to the Convention. The draft law was developed to fulfill Ukraine’s European integration commitments in the customs area, the Ministry of Finance said.
Earlier, roundtables were devoted to customs reform, where the event’s organizer and moderator Maksim Urakin stated that the State Customs Service provides 35-40% of state budget revenues, and these figures have remained stable in recent years. That is why customs reforms are so important for the country.
Ukraine has created a legislative basis for priority cross-border passage of goods placed under the joint transit procedure, and also made it possible to carry out internal transit of goods using the NCTS, similar to the Union transit provided for by the EU Customs Code.
So the Ministry of Finance on its website commented on the main innovations of the law “On Amendments to the Customs Code of Ukraine on the use of customs declarations and electronic transit system provided by the Convention on the procedure of joint transit (NCTS – IF) for transit under the terms of this Code” (No. 9014-1) adopted by the Verkhovna Rada on July 13.
“The adopted amendments to the Customs Code create favorable conditions for Ukrainian businesses to open T1 declarations in internal customs, which, combined with the electronic queue at the border, will unload customs checkpoints and reduce the time of customs clearance for NCTS users,” the Ministry of Finance pointed out.
The ministry added that the law also provides for the introduction of additional transit simplifications, in particular, the status of authorized TIR consignor and authorized TIR consignee and the registration of a single transit declaration for goods that are or will be moved in one vehicle (container or package) from one customs office of departure to one customs office of destination.
Other simplifications include bringing in line with the EU customs legislation and the provisions of the Convention on the Joint Transit Procedure the requirements to seal all transit movements or, if sealing is impossible, to ensure identification of the relevant goods
The draft law was developed in fulfillment of Ukraine’s European integration commitments in the customs sphere, the Finance Ministry said.
Earlier, roundtables were devoted to customs reform, where the event’s organizer and moderator Maksym Urakin stated that the State Customs Service accounts for 35-40% of state budget revenues, and these figures have remained stable in recent years. That is why customs reforms are so important for the country.
