External Transit (T1)

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External Transit, commonly known as the T1 procedure, is a critical customs instrument allowing non-Union goods to move within the EU customs territory. This procedure suspends the payment of import duties and taxes (such as VAT) during transit, greatly enhancing supply chain liquidity and flexibility. The T1 is the physical or electronic document that legally facilitates this movement under strict customs supervision, often utilized when moving goods to bonded storage or another customs office.

Definition

External Transit (T1) is a cornerstone of European logistics operations concerning non-Union goods. It is a legal framework designed to suspend the application of standard import duties, tariffs, and national charges (like VAT) while the merchandise is transported between two points within the Union's customs territory. The term T1 also refers specifically to the transit declaration document that accompanies the goods.

Core Function

The primary function of the T1 regime is to allow goods to be moved without immediate customs clearance or payment of duties, typically upon entry at the first EU border until they reach an approved inland location (e.g., a Customs Warehouse or an Office of Destination).

This procedure requires a guarantee (provided by the declarant or carrier) to cover the suspended duties, ensuring compliance. The movement is managed electronically via the New Computerised Transit System (NCTS).

Key operational aspects:

• Suspension of Duties: Import duties and taxes are suspended throughout the movement.

• Customs Supervision: Goods remain under the continuous supervision of Customs authorities and must adhere to predefined routes and approved destinations.

• Approved Locations: Goods can only be discharged at authorized premises, such as Customs Warehouses (CW) or approved consignee locations.

Expert Advice

Logistics operators must prioritize the timely discharge of the T1 document at the Office of Destination. Failure to correctly conclude the T1 procedure can lead to the transit guarantee being called upon, resulting in immediate duty payment liability and potential fines. Always ensure your chosen transport partners are authorized to operate under the Transit procedure and understand their specific legal liability in the event of non-conclusion or breach.