DECO
Also known as: Declaratie E-Commerce, e-commerce declaration
DECO is the Dutch customs system for declarations of e-commerce shipments with an intrinsic value up to one hundred and fifty euro. It processes large numbers of small shipments with a strongly reduced data set.
For which shipments do you use DECO?
For shipments with an intrinsic value up to one hundred and fifty euro that are exempt from import duties but are still liable to VAT. That is the classic parcel flow from China, the United Kingdom and the United States. The intrinsic value is the price of the goods themselves, without freight and insurance. Above one hundred and fifty euro the ordinary import declaration in DMS applies. Excise goods and shipments with prohibitions and restrictions also fall outside DECO. A shipment of 149 euro with a plant subject to inspection is not a DECO shipment, even if it sits under the threshold. The H7 set cannot carry that measure. DECO is a Dutch system. Other member states have their own channel for the same H7 data set. Do not translate DECO as the European e-commerce system; it is the Dutch gateway to that data set. A Belgian or Irish shipment does not run in it.
Which data does DECO ask for?
DECO works with the H7 data set: the super-reduced set from the UCC with among other things consignor, consignee, value, a short description and a six-digit goods code. The full ten-digit TARIC code is not needed, which speeds processing but also means the check on prohibitions and restrictions has to happen elsewhere in the chain. The data often come from a webshop system, not from a customs administration. Description gift or sample, a value of one euro, a missing consignee: they are standard rejections. Because the source is a seller on the other side of the world, correcting on the Dutch side is often not possible and the shipment has to go back. At numbers of tens of thousands of shipments per day the declaration is fully automated. Manual intervention is only there at rejections. The quality of the data set is therefore the whole declaration. A mapping that truncates descriptions or rounds values produces rejections at the same pace as the flow comes in.
How does the VAT sit?
VAT is due on every shipment; the exemption up to twenty-two euro lapsed on 1 July 2021. If the seller has an IOSS number, the VAT has already been levied at the sale and the shipment comes in without VAT levy on import. The IOSS number belongs on the declaration, otherwise Customs levies again. Without IOSS the VAT is levied on import, usually advanced by the carrier and passed on to the consignee with clearance costs. That is the bill the consumer gets on the doorstep, and the reason platforms use IOSS: without that bill conversion is higher, with that bill there is a complaint. IOSS covers the VAT, not the import duties. Up to one hundred and fifty euro those duties are exempt. If that exemption lapses, IOSS still covers the VAT and the duty has to be calculated via a full code. DECO with only six digits is then no longer sufficient.
What does the e-commerce flow look like in practice?
An e-commerce platform or a carrier supplies per shipment a data set with consignor, consignee, value and a short description. Those data often come from a webshop system and not from a customs administration. The declarant converts those data to an H7 declaration and files it at DECO. At numbers of tens of thousands of shipments per day that happens fully automatically; manual intervention is only there at rejections. The bottlenecks sit in the data quality. A description such as gift or sample, a value of one euro or a missing consignee produces a rejection. Because the source is a seller on the other side of the world, correcting on the Dutch side is often not possible and the shipment has to go back. A process that handles rejections one by one does not keep up with the flow. Filter the data set before DECO, not after, and send back what the H7 set cannot carry.
What is changing in the e-commerce rules?
The EU is working on abolishing the exemption from import duties up to one hundred and fifty euro. If that disappears, import duty becomes due on every imported shipment and the H7 set is no longer sufficient, because a full goods code is then needed for the tariff. That hits the whole chain: platforms, carriers and declarants. They then have to supply a ten-digit code and a supported value per shipment instead of a description and an amount. The direction is clear, the date is not. Anyone setting up an e-commerce flow now does well to prepare the data models already for a full goods code instead of for the minimum set that suffices today. DECO as a Dutch channel can change with it or make way for a full IMA flow in DMS. Build the link so that the data set can carry more than H7, even if you still file H7 today. A mapping that only knows six digits is on the day of the change a blockage.
How do IOSS and DECO work together?
IOSS is the VAT scheme in which the seller levies and remits the VAT at sale, so that no VAT is still due on import. DECO is the declaration channel. On the H7 declaration you put the IOSS number, and Customs then does not levy the VAT again. Without a number, or with a number that is not active, the VAT is levied on import. A shipment under IOSS remains a customs declaration. The number does not replace DECO. It only replaces the VAT levy on import. Duties are exempt up to one hundred and fifty euro, inspections and prohibitions are not. An IOSS shipment with a product subject to inspection does not belong in DECO, IOSS or not. Check the IOSS number in the seller's master data, just like an EORI number. An expired number produces double VAT: once at the sale, once on import. The consumer then pays twice, and the complaint lands with the carrier who advanced the import.
What if the shipment comes out above one hundred and fifty euro?
Then DECO is no longer sufficient and the shipment must go as IMA in DMS, with the ten-digit TARIC code, the full customs value and the document codes that belong with that code. The intrinsic value is the goods price without freight and insurance. A shipment of 140 euro plus 20 euro freight stays under the threshold; a shipment of 160 euro goods does not, even if the freight is zero. Do not split a shipment artificially to stay under the threshold. That is a construction Customs sees as circumvention. Conversely also do not bundle eight orders of 40 euro into one IMA without them being one shipment; the H7 flow is per shipment, the IMA is per declaration. Put a threshold in the gate: under the threshold and without restrictions to DECO, above it or with restrictions to DMS. That gate belongs before the declaration, not after. A DECO rejection because the value is too high is a shipment that already sat in the wrong channel.