The new rules for the “Voluntary Disclosure System” have been introduced by Dubai Customs through Customs Policy No. 58 of 2024. This policy requires businesses to provide prior notification on any mistake or infringement along with the customs declarations. The policy ensures transparency and compliance in businesses’ trading.
Purpose of the Voluntary Disclosure System
The objectives of the Voluntary Disclosure System include:
- Permit exemptions that can be full or partial where the violation is reported by the offender.
- Ensuring customs transparency and effecting best practices in trade and logistics sectors.
- Fostering trust between business and distinct entities.
What Constitutes a Voluntary Disclosure?
Voluntary disclosure is described as a measure by which, having detected mistakes or breaches in customs legislation, companies report them to Dubai Customs without waiting for them to be revealed by audits or inspections.
Voluntary disclosure policy applies to various customs violations, including:
- Import and export infractions
- Errors in customs declarations
- Violations related to the transit of goods
- Breaches in customs warehouse regulations
- Issues in areas monitored by customs
- Infractions in temporary import processes
- Violations related to re-export
- Any other customs rules violations
Businesses are advised to self-report these violations in a timely manner to avoid incurring heavy penalties if they consent to the violations.
Process for Submitting a Voluntary Disclosure Request
The process for submitting a voluntary disclosure request includes the following steps:
- Submission of Disclosure Request: In completing the voluntary disclosure request form, the businesses have to go through the e-customs system of Dubai Customs, and submit any supporting documents and records that explain the nature of the mistake.
- Review and Approval: After the submission of the voluntary disclosure, Dubai Customs will assess the request made by the client. If so, a financial claim notification will be issued with any payable customs dues to the business.
- Duty Settlement: The assessed duties are paid by the business within a period of thirty days after the notification is received. In case of non-settlement within this period, the voluntary disclosure shall become null and void; further action which may follow from Dubai Customs may include conducting a customs audit.
Important Considerations for Voluntary Disclosure Submissions
- Exclusions: Requests for voluntary disclosures will not be accepted for such enterprises that have been targeted for customs audits, inspections, or investigations. Also, if a business has received a notification from Dubai Customs about a specific non-compliance matter or in case of audit then the business cannot apply for the benefits of the voluntary disclosure program.
- Electronic Channels for Submission: Electronic Channels for Submission: Dubai Customs provides submission through its digital platforms which include:
- Dubai Customs Portal
- Dubai Trade Portal
These platforms ensure businesses to seamlessly submit and track their voluntary disclosure requests conveniently.
Benefits of Voluntary Disclosure for Businesses
By proactively disclosing customs errors, businesses benefit in distinct ways:
- Penalty Relief: Businesses can apply for the waiver of such penalties in full or in part where they are affiliated with either a disclosed violation or a detailed finding of it. This relief assists in discouraging the practices that may lead to some hefty fines and promotes corporate disclosure.
- Compliance Assurance: Through voluntary disclosure, companies can be certain that their customs processes incorporate the Dubai regulation therefore fortifying their compliance.
Requirements for Businesses
Businesses are required to:
1. Conduct Internal Compliance Audits
- This include making a review of previous customs declarations so that any mistakes which might be voluntarily disclosed by the company are noted.
2. Prepare for Voluntary Disclosure Submissions
- In case of any mistake, businesses are required to assemble the required paperwork and resolve to submit the voluntary disclosure via the official electronic mediums of Dubai Customs.
3. Embed Compliance Checks in Routine Audits
- Compliance checks should be integrated to be part of regular audits.
- One natural method of maintaining customs compliance in Dubai is conducting customs compliance checks during the regular audit.
Conclusively, the Voluntary Disclosure System allows companies to self-report violations of compliance regulations, which ensures compliance with customs procedures and operations.
