How data-intensive CDS will change your businesses

The switch-off of CHIEF for imports is just one step in an ongoing move to a more data-driven environment across government and the private sector. For large and small businesses, this presents opportunities as well as challenges.

28 Sep 2022

You will know by now that customs declarations are changing as they move onto the UK Customs Declaration Service (CDS). It imposes new trade data requirements on the trading community and one of the first things you will probably be told is that it is driven by compliance with the Union Customs Code (UCC) and that the volume of customs declarations was stretching the capacity of the decades-old CHIEF system.

However the format - and some of the contents - of declarations is changing to a larger number of single-purpose Data Elements in CDS replacing the CHIEF Boxes that often contained lists of codes and other text. It also adds a lot of information requirements by changing them from being limited to a single value across the entire consignment, to allowing different values for different line items within a declaration.

What is the reason for these more substantial changes?

In line with many digital transformation initiatives, customs authorities are looking for more data, more often and more accurately. Also the UCC, which was a driver of the design of CDS, has standardisation and fully electronic customs among its key objectives.

In this post, we touch on what this means for businesses. Follow us on LinkedIn (here) or join our newsletter (here) to receive updates in future.

Starting simply, but potential for further information requirements

HMRC is phasing in some more requirements over time, partly a reflection of the challenges the industry still faces - even in 2022 - in making this information available. CDS has space for additional information that is not being used to begin with. Let’s explore some examples:

Supply chain actors

It is possible to provide details of other supply chain actors ( DE 3/37 ) like the manufacturer, forwarder or consolidator. It remains optional for both imports and exports, but the system makes provision for many of these to be declared at the consignment level and even for different parties to be identified for different line items within a declaration.

Complex arrangements

In import consignments where the buyer is not the importer, or where the seller is not the exporter, CDS requires the additional party to be identified ( DE 3/24 ). If there are different sellers for different line items within a single declaration, that level of detail is also requested. However, as reported by BIFA, feedback from industry has meant that HMRC temporarily removed the requirement for that extra information for GB import declarations.


For exports, CDS asks for the countries along the route through which the goods will move. This is in addition to the origin and destination countries and the possibly separate country where the customs declaration is made. However, the requirement only applies to particular declarations and is tempered by the statement that

 DE 5/18  The countries of routing should be provided to the extent known.

This is partly a reflection of the fact that the person making the customs declaration may not know - at the time of submitting it - the route that will be chosen by the transporting agency.

In addition to the customs authorities, many other parties in the export-import transaction would also like to know this information closer to real-time, and this puts additional demands, not just on companies’ internal information systems, but also on the systems of communication between the parties involved.

Three ways CDS changes can benefit your business

1. More flexible operating models based on clearer instructions

With fine control over identifying the responsible parties and their roles, CDS reflects the sharing of data with service providers like brokers and forwarders.

While it has always been the case that the trading business is ultimately responsible for declarations to the Government, the detail was sometimes unclear. For example, with CDS it can be clearly shown that a freight forwarding company (representative) is instructing a customs broker (declarant) to make customs declarations on behalf of a trader (exporter/importer). This was not so clear in CHIEF. Now, as long as the contractual arrangements are similarly clear, customs declarations on CDS are capable of reflecting this state of affairs without exposing the parties to uncertainty and risk.

A business might wish to expand on this to take control of arrangements between multiple brokers and forwarders in other countries. For example, the growing number of UK-based businesses that engage with EU-based warehousing, where the relationship might include an importer of record.

“The forwarder paid for the duties that were already paid by us as they had misunderstood the Incoterms, now they have used their limits and can’t take anymore instructions”
— A global manufacturing business

2. More demands around valuation, proof of origin, classification, tax types

As goods transit through borders, they incur liabilities relating to their origin, intended use and delivery points.

Valuing the goods is an essential critical process, one that challenges record keeping on decisions made through the journey of the goods from raw material to finished product, including the changing classification status.

As CDS requires a record of import delivery terms ( DE 4/1 ), shippers need to measure and calculate robustly their valuation processes including any adjustments and choices on the application of preferential rules of origin, potentially ensuring they are meeting their obligations with long term supplier declarations.

Furthermore the shipper is obligated to have accurate descriptions.

 DE 6/8  - Enter a description of the goods which is specific enough to allow the unambiguous identification, classification and examination of goods .

“If my supplier was audited I don’t believe they fully understand how to calculate the value of their products under our long term supplier declarations”
— A global manufacturer

CDS has now moved firmly into structured data elements, instead of semi structured, when tracking documents associated with licences/permits etc. This is good practice and shippers who manage to implement and embed these processes deeper in and across their organisation will be in a good position as various countries and trading blocs around the world continue to adopt new measures and regulations.

For example, there are plastic packaging taxes, logistics tracking and nascent tracking of environmental and social performance metrics like carbon border adjustment mechanisms. There are also lots of other developments in the UK and abroad around single windows, ecosystems of trust, and free zones / enterprise zones.

“My shipment just arrived, the forwarder has not provided any information as to what taxes are to be paid, nor if they have been paid. I don’t know what cashflow I need to prepare for”
— An importer of foodstuffs

3. Getting on top of the cashflow impacts of trading internationally

Businesses can register to see financial liabilities appear on the customs Financial Dashboard on their Government Gateway. While that is nice, it is important to have a view of these liabilities ahead of them landing on the official dashboard. As many businesses need to send new consignments before the previous ones have fiscally cleared and manage guarantee lines, they will want their customs brokers to inform them of upcoming liabilities in near real-time.

Now that more detailed information is going in and out of CDS, you can have better control points on people (your own employees or your agents) committing company resources like guarantee lines. To benefit from this, you need to ensure your business software can access this information, so that you can insert the control points before the commitments are made.

CDS’ need for invoice level information (e.g. tax/excise lines, valuations, procedure codes) increases the need to verify calculation steps as goods pass through various control points, like warehouses, borders and their service providers as custodians. Future ways of working around freezones, single windows or trust ecosystems drive the need for accurate and timely financial impact measurements - those that CDS are subtly preparing traders for - so long as they have invested in the infrastructure to deliver.

“I am still trying to get a rebate for an overpayment by the forwarder of a shipment one and a half years ago, they cannot resolve it themselves”
— An electronics manufacturer

Getting better at managing and sharing trade data will stay important as government requirements continue to get more stringent and as the commercial advantages become more apparent to the traders, freight forwarders, customs brokers and other trade services providers in the industry:

Take time to plan, consult and understand how to leverage your investment in CDS.

At Exabler, we are all about helping businesses like manufacturers, distributors, freight forwarders, and customs brokers to manage and share trade data more effectively to save time, reduce costs, and stay compliant. People using the system’s full functionality are able to stay ahead of these upcoming requirements. Please contact us if you would like to see how Exabler can help you and your team.

Sources: HMRC, BIFA, Exabler