Movement of excise goods: documents, modes and tracking

What is the role of EMCS, e-AD, ARC, ADD, e-ADD and PAD according to the regime of the excise goods

The movement of excise goods not a standard shipping process. With alcohol, tobacco products, energy products and other excise goods, it is important to first specify in which regime the goods are located and what document must accompany them.

In practice, terms such as EMCS, e-AD, ARC, ADD, e-ADD And UNDER. They do not mean the same thing and are not used in all cases.

The most important question is not simply "what document do I need", A what is the regime of the goods — whether it moves under the regime of deferred payment of excise duty, whether it is released for consumption, whether the excise duty has already been charged, whether there is a parcel and whether the movement is to another tax warehouse, commercial establishment, composition, customer or another country.

Why mode is most important?

For excise goods, the documents depend on the status of the goods. The same physical shipment may look like a standard pallet or cartons, but from an excise point of view to be in a different regime.

For example, the product can be:

under the regime of deferred payment of excise duty;
released for consumption;
with excise duty charged;
with a parcel, when applicable;
in transit between tax warehouses;
on the way to a commercial establishment, warehouse or other consignee;
in transit to another member state;
in motion after importation or before release.

Therefore, before organizing the transport, it must be clear what the excise status of the goods is and what exactly should happen to them.

What is EMCS??

EMCS is the electronic system for movement and control of excise goods.

In the classic case, it is used in the movement of excise goods under the regime of deferred payment of excise duty — for example, between tax warehouses or other authorized participants, without excise duty being paid at the time of shipment.

Practical EMCS shows, that the goods do not simply move like ordinary cargo. It moves under excise control and the movement must be registered, traceable and closed correctly.

What is e-AD??

e-AD means an electronic administrative document. This is the document, which is used in the movement of excise goods under the regime of deferred payment of excise duty.

Through e-AD, the specific movement is registered in EMCS. It contains information about the sender, the recipient, the goods, the quantity, regime, the place of receipt and other data, needed to track the excise movement.

When talking about the movement of excise goods under regime, e-AD is one of the main documents, which must be properly prepared and registered.

What is ARC?

ARC means Administrative Reference Code. This is a unique administrative reference code, which is generated for a specific movement in EMCS.

ARC allows movement to be identified and tracked. It's not just a "tracking number" like a courier package, and part of the excise regime.

Physical transport may have a CMR or other transport document, but the excise status of the movement is tracked through EMCS, e-AD and ARC.

What is PAD?

UNDER means an accompanying administrative document. This is the old paper document, which was used in the movement of excise goods under the regime of deferred payment of excise duty.

With the introduction of EMCS, this process goes into electronic form. Today, when driving under the regime, the main document is e-AD, and the particular movement is identified by ARC the code.

Therefore, in practice, PAD can be considered as the old paper predecessor of e-AD in movements under regime. It should not be confused with ADD or e-ADD, which are related to the charging of excise duty and exemption for consumption.

What is ADD??

ADD means an excise tax document. It is related to the charging of excise duty and the release of excise goods for consumption.

ADD is not the same as e-AD or PAD. E-AD is used when driving under the regime of deferred payment of excise duty, while ADD is related to the charging of excise duty on release for consumption or in other applicable cases.

Therefore, it is important to know whether the commodity is still moving under regime, or is already released and an obligation to charge excise duty arises for it.

What is e-ADD??

e-ADD is an electronic excise tax document. This is an electronic form of the excise tax document in cases, when the document is submitted and processed electronically.

When a case study talks about e-ADD, we're usually no longer just talking about motion tracking under mode, and for the document, related to the charging of excise duty and the release of the goods for consumption.

This distinction is important, because customers often mix e-AD, ARC, UNDER, ADD and e-ADD, and they have a different function.

What is the difference between EMCS, e-AD, ARC, UNDER, ADD and e-ADD?

The distinction can be most easily understood like this:

EMCS — the system, through which the movement of excise goods under regime is registered and tracked;
e-AD — the electronic administrative document for the movement of excise goods under the deferred payment regime;
ARC — the unique reference code to the particular movement in EMCS;
UNDER — the old paper accompanying administrative document, used before the electronic process with e-AD and ARC;
ADD — excise tax document, related to charging excise duty and exemption for consumption;
e-ADD — electronic form of the excise tax document.

In other words: EMCS, e-AD, The ARC and the old PAD are mainly related to movement under the regime, while ADD and e-ADD are related to the charging of excise duty and exemption for consumption.

How does traffic flow under deferred payment mode?

Case in point: excise goods move from one tax warehouse to another tax warehouse. The goods are not released for consumption at the time of dispatch and excise duty is not paid on departure.

In such a case, a movement is usually created in the EMCS, an e-AD is issued and an ARC code is generated. This code allows the movement to be tracked by the participants and the administration.

Physical transport may be described in a CMR or other transport document, but excise duty is tracked through EMCS and ARC.

Upon arrival, the recipient must confirm receipt according to the applicable process, for the movement to be completed correctly.

Who is referred to as ADD??

ADD is being talked about, when the excise goods are released for consumption and there is a need to charge excise duty.

This is different from running on deferred payment. In deferred payment mode, the excise duty has not yet been paid and the movement is tracked through EMCS, e-AD and ARC.

Upon release for consumption, the excise duty is charged, and for certain goods there may be additional actions, eg bundling, if applicable.

What is a simplified accompanying document?

In certain movements of excise goods, which have already been released for consumption, a simplified accompanying document or an electronic simplified accompanying document may be used.

This is a different logic than moving under a deferred payment regime. When driving under mode, we are mainly talking about EMCS, e-AD and ARC. For goods, which have already been released for consumption, documents and requirements depend on the specific case, the countries and the status of the goods.

Therefore, it is important not to mix PADs, e-AD, ADD and simplified accompanying document. Each of these terms is associated with a different context.

How documents are related to transport?

For excise goods, a clear distinction must be made between physical transport, excise regime and commercial documents.

CMR or other transport document describes the physical movement — addresses, carrier, pallets, weight and description of the cargo;
EMCS / e-AD / ARC show the movement under excise regime;
UNDER is the old paper accompanying administrative document for movements under regime;
ADD / e-ADD are related to the charging of excise duty;
invoice, agreement, packing list or warehouse receipt show the commercial and accounting side of the case.

This distinction is important, because the transport document does not in itself prove the excise status of the goods, and EMCS does not replace the invoice or commercial documents.

Where can a problem occur?

Problems occur most often, when the excise regime is not specified in advance or when the documents are mixed.

Typical problems can be:

unclear if the item is on deferred payment;
unclear whether the goods are released for consumption;
missing or wrong e-AD;
missing or unspecified ARC;
PAD mixing, e-AD, ADD and e-ADD;
expectation, that the CMR replaces the excise document;
expectation, that EMCS shows ownership of the goods;
discrepancy between quantity, description or codes in the various documents;
recipient, who does not have the right to accept the goods under the relevant regime;
unclear when an ADD or e-ADD should be issued;
unspecified packing for goods, to which this is applicable;
movement, which was not properly concluded by the recipient.

Therefore, with excise goods, it is important to specify the process in advance, and not after the cargo has already departed.

How E-Logistics can help?

E-Logistics can assist with excise goods by specifying the regime in advance, the documents, warehouse process and movement.

Depending on the specific case, assistance may include::

acceptance and storage of excise goods in a tax warehouse;
assistance when driving under a deferred payment regime;
coordination of information, required for e-AD and ARC;
assistance in release for consumption;
case coordination, related to ADD or e-ADD;
bundling and labeling, when applicable;
connection with a transport process via E-Sped if subsequent movement is needed;
coordination between client, composition, carrier and consignee.

The goal is to know the status of the goods even before the movement, what document is required and how the process should be organized.

What information is good to prepare?

For a faster pre-check, it is useful to send basic information about the goods, the mode and purpose of the movement.

It is good to prepare:

type of excise goods;
quantity, packaging and number of pallets/cartons;
alcohol degree, if it is about alcoholic products;
code according to KN/HS, if available;
sender and receiver;
tax warehouse data or other authorized participant, if applicable;
whether the goods move under the regime of deferred payment of excise duty;
whether the goods will be released for consumption;
whether there is already an e-AD, ARC, ADD, e-ADD, PAD or other document;
whether excise duty has been charged or is due to be charged;
whether bundling or labeling is required;
loading and unloading address;
invoice available, packing list, CMR or other documents;
desired term and subsequent movement of the goods.

In the case of excise goods, we may assist with prior specification of the regime, the documents, the warehouse process and the organization of movement according to the specific case.

You have movement of excise goods?

When moving excise goods, we can assist with a suitable warehouse, document and logistics process according to the product, mode and route.