The EU says the UK has failed to meet its obligations to fight

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The EU Court of Justice is set to impose a huge fine on the UK after finding negligence in imposing EU anti-fraud obligations and introducing the correct amount of customs duties and VAT, according to Fashion United.

Following a court investigation, it was ruled that the United Kingdom had “not complied” with relevant EU law, leading to an overflow of imports of undervalued and fraudulent textile and footwear from China.

The failures of the United Kingdom were in the period 2011-2017, during which time the United Kingdom was a member of the EU.

In a judgment, the Grand Chamber of the Court of Justice stated that the United Kingdom “did not apply effective customs control measures or did not enter in the accounts the correct amounts of customs duties” on certain imports from China, and that no provided the necessary information for the calculation of the tax and own resources.

A complaint lodged by the European Anti-Fraud Office (OLAF) in 2017, which led to the decision, stated that the United Kingdom had not followed its recommendations to reduce the amount of undervalued products in China for later sale on the European market.

OLAF introduced a risk assessment tool after requiring EU Member States in 2007, 2009 and 2015 to start monitoring imports and carry out customs controls on Chinese textile and footwear by shell companies. However, OLAF stated that the United Kingdom releases products on the market without carrying out proper customs controls, which has led to some customs duties not being collected or made available to the European Commission.

To cover the loss of the EU, the commission demanded a payment of almost 2.7 billion euros from the UK government – an amount that was rejected by the court due to inconsistencies, with EU officials being asked to recalculate the losses.

The UK will not have the right to appeal the final verdict, but can challenge the commission on how much money should be paid once the bill is reviewed.