Aerospace and Defence Industry

Aerospace and defence industry. We have been providing the aerospace and defence industry with customs & trade compliance advice for many years and have developed specialist insight into the customs & trade compliance issues impacting the aerospace and defence industry, such as export controls and defence related duty reliefs.

Aerospace 

The Chicago Convention on International Civil Aviation provides (cf. Article 24 (a)) that fuel and lubricating oils on board an aircraft of a Contracting State, on arrival in the territory of another Contracting State and retained on board on leaving the territory of that State, shall be exempt from customs duty, inspection fees or similar national or local duties and charges. The Chicago Convention also refers to the temporary admittance, free of duty, of aircraft on a flight to, from or across the territory of another Contracting State and to the exemption from customs duty, etc., of spare parts, regular equipment and aircraft stores.

Under the WTO Agreement on Trade in Civil Aircraft, importers of aircraft and aircraft parts parts, components and other goods falling within Chapters 25-97 of the Harmonised System, of a kind to be incorporated in or used in the manufacture, repair, maintenance, rebuilding, modification or conversion of civil aircraft can benefit from relief from import duties. In the UK, this relief is enacted under The Certificate of Airworthiness scheme which allows importers to claim duty relief on parts imported with a certificate authorised by EU aviation authorities or third-country (non-EU) authorities. Claims for relief can be made on: parts, components and other goods with the certificate falling within the Chapters 25-97; goods intended for re-export within a specified time; and some goods imported for use in authorised aircraft spare-parts depots.

Defence

Aerospace and defence companies may qualify for relief from customs duty for goods imported in connection with military contracts; NATO infrastructure contracts; and for the provision and maintenance of defence facilities. In addition, many countries operate suspensions of duties on a wide range of goods for military equipment, such as uniforms, footwear as well as military equipment. Many countries throughout the world have specific legislation covering the import of defence and aerospace goods. It’s important to research both sides of the transaction.

Military and certain dual-use goods (ie items not specifically designed for military purposes but that could be used as such) need an export or trade licence before they can be exported. The licensing process is managed in the UK by the Export Control Organisation. Items that haven’t been specifically designed for a military purpose but that could be used for such a purpose because of the high specification are classed as ‘dual-use’ and may require a licence. Any goods involved in handling, operation, maintenance, storage, detection, identification or the spread of nuclear, biological or chemical weapons also need a licence, as do goods that are not included in the Strategic Export Control List, but that may be used in a weapons-of-mass-destruction context. Some exports not on the Military List may need an export licence under the military end-use control. This applies if the exporter has been informed that the goods are to be used for a military purpose in a country under an arms embargo, or informed that they’re to be used for illegal weapons.

You need to be aware of international trade sanctions or arms embargoes against particular countries or regions. See current arms embargoes and other restrictions.