Temporary Importation Background
- Updated December 2, 2014
- Once an aircraft arrives in the EU, it is automatically granted temporary admission and eligible for conditional relief from VAT and customs duties so long as the following conditions are met:
- Aircraft must not remain in the EU for more than six months in a twelve month period.
- Aircraft must be owned outside of the EU and not made available for use within its boundaries by EU residents (see below for additional details).
- The aircraft is flown for private use, not commercial use.
- In general, temporary admission is only available to aircraft in private use and is not available to aircraft in commercial use within the EU. Commercial use is defined as “the transport of persons for remuneration or the industrial or commercial transport of goods, whether or not for remuneration.” While private use is defined as, “the transport exclusively for personal use by the person concerned excluding commercial use”.
- One of the challenges with temporary admission is that definitions of private and commercial use relied upon by customs authorities in the EU do not always line up with definitions provided by authorities such as the FAA and ICAO. Also, the varying interpretations of the customs code within the EU also make it difficult to understand if temporary admission is available to traditional private business aircraft operations conducted by a corporate operator.
EU Clarifies Private vs. Commercial Use Definitions for Temporary Admission
- Updated December 2, 2014
- The International Business Aviation Council (IBAC) requested that the European Commission (EC) provide clarification on how private use and commercial use are defined for the purposes of temporary admission. Based on a working paper published by the EC, it is now clear that most private flights conducted by corporate operators within the EU are permitted under the temporary admission process.
- For example, the working paper describes a scenario where a non-EU registered aircraft flies to multiple destinations within the EU with non-EU residents on board. The aircraft also picks up an EU-resident employee of the company and flies that person (along with the other passengers) within the EU. Once these flights are completed, the aircraft departs the EU. Finally, the aircraft also carried company materials/brochures and IBAC asked if this would be deemed "industrial or commercial transport of goods."
- The EC responded that this scenario would be considered private use for customs purposes since no remuneration is involved. Assuming the conditions described above are met, temporary admission would be available for this operator. Regarding the transportation of company materials/brochures, the EC responded that since transportation of these materials is not the main purpose of the flight, this is not considered to be the commercial transport of goods and is private use.
- The working paper has been provided as guidance to customs officials in EU member states, so operators should carefully review the scenarios and other information provided to determine if temporary admission is a solution for their EU flights. The EC Customs Code, its implementing guide and the Istanbul Convention have not been modified, but this working paper should provide clarity to operators and customs officials.
Transport of EU Residents
The NBAA paper that covers this topic has been removed. I will quote it here for background information.
- Updated December 2, 2014
- Customs regulations typically provide that transport of EU residents within the EU territory is not subject to duty and tax so long as the travelers are employed by the aircraft owner or otherwise authorized to be on board. If the EU passengers are not employed by the aircraft owner, it is recommend that the aircraft owner prepare a letter stating that the EU passengers are authorized to be on board. If the aircraft is leased, the letter can be prepared by the lessee.
- In addition to EU residents that are carried on board for a business purpose, it is possible to carry EU residents for non-business purposes. Again, the aircraft owner must prepare a letter stating that the EU residents are authorized to be on board.
- If the transportation of EU residents meets the conditions described above, operators are still generally permitted to use the temporary admission process.
Since the days when temporary import without paying the prohibitively expenses VAT was discontinued, I've always operated into and out of EU states with a ground handling agent, who took care of all the temporary import chores. I think it is cheap insurance to make sure the process goes smoothly. What if you want to do it on your own?
See: European Commission / Taxation and Customs Union / Temporary Importation.
If you think you may need to import your aircraft into the EU, Denmark based OPMAS is worth considering. I asked them about their services and here are the answers they provided:
- Q. I thought I read somewhere that some EU member states have refused to recognize the 0% VAT, but maybe that was more pilot rumor than anything else. Have there been any instances where an EU member state refused an aircraft imported using your services?
A. No Never. A Danish customs document has always been 100% recognized all over the EU, due to the high standards (everything is done by the book) and the fact that corruption does not exist in Denmark.
- Q. I have imported several aircraft under the old system, usually through the Isle of Man. Under that system, as I recall, the import was only good to the current aircraft registration owner and did not transfer. Is that also the case with your services?
A. Basically, valid as long at the aircraft is operated the same way as when imported, documents can of course be used for multiple EU-trips.
You should also give their brochure, A Quick Overview of Aircraft Importation Issues, a look.