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French customs service withers as Europe borders become "sieve"

Emmanuel Jarry
Friday, 25 Oct 2013 | 7:00 AM ET

PARIS, Oct 25 (Reuters) - Only four customs officers are left at the airport in the French Riviera resort of Cannes, renowned as a bastion of the Calabrian mafia. There used to be 20.

The only fixed container scanner in the port of Le Havre, maritime gateway to the Paris region, has shut down and there is no plan to replace it. Customs patrol boats are tied up in dock and vehicles are grounded for want of fuel.

Since 2011 the number of seizures of counterfeit goods has fallen by half in France. But the customs service says around a third of the articles it did inspect last year were not in conformity with EU rules, up from 22 percent in 2011.

Europe, some trade unionists and European lawmakers say, is becoming a "sieve" for fraudulent, counterfeit and dangerous goods thanks to budget cuts, rivalry among ports and airports, and lax enforcement of European Union rules to aid business.

Sirpa Pietikainen, a member of the European Parliament's internal market and consumer protection committee, estimates that 99.7 percent of products now entering Europe "are not verified by any authority".

Computers are programmed to detect suspected irregularities in the forms without the detective's flair, said Guillaume Coursin, a trade unionist.

"The criteria for targeted checks are now set by machine, not by experienced customs officers," he said.

France, despite its reputation as a champion of regulation, is no exception to the European trend.

In 20 years, the number of French customs staff has fallen by a quarter from 22,500 in 1993 to 16,662 today. Only half of them are involved in active surveillance, although the volume of trade has expanded exponentially over the last two decades. Another 300 jobs are set to go next year.

"Ten years ago, 1.2 million containers a year arrived in the port of Le Havre, with 560 customs staff and three agents of the competition and anti-fraud service," said Bertrand Vuaroqueux of the National Union of Customs Officers. "Today, it's 2.5 million containers but fewer than 400 customs staff and no one from the anti-fraud service."

Even the economy ministry, in charge of customs, hints at an official weakening of overall surveillance.

"The priority is no longer systematically to check vessels in coastal waters but to focus on the most important fraud cases," it said in the draft 2014 budget.

RACE TO THE BOTTOM?

The role of customs has been revolutionised by the single European market, which mandated the free movement of goods inside the 28-nation EU, by globalisation which multiplied international supply chains, and by the economic crisis.

European customs services are under orders to facilitate the flow of trade and make life easier for companies to avoid hobbling economic competitiveness.

Fierce competition for business among European ports and airports has led to what critics call a race to the bottom between national customs services.

The big winners are Europe's two largest ports, Belgium's Antwerp and Rotterdam in the Netherlands, where China has invested in making the 12-million-container-a-year megaport on the Maas/Rhine Estuary its main gateway into northern Europe.

As the EU seeks a string of free-trade deals across the globe, Antwerp is building the world's largest lock, wide as a 19-lane highway, to accommodate a new generation of giant ships.

Despite Belgian government budget cuts, port staff will increase by about 300 when Antwerp transforms its customs service to a 24/7 operation from next January. Currently, safety and security inspections are from 6 a.m. to 10 p.m. and importers must pay extra if they want containers checked out of those hours.

But like most European ports, Antwerp is under pressure from importers to do checks quickly and efficiently. While only 1 to 2 percent of goods entering Europe are physically inspected nowadays, online checks of digital paperwork are carried out on the basis of risk analysis.

FOUR-MINUTE INSPECTION

The pressure to speed up can be quantified in France.

The French customs service has set staff a target of reducing the average time to clear goods to 4 minutes 45 seconds next year and 4 minutes 30 seconds in 2015. It was 13 minutes in 2004.

"People don't realise how overwhelmed and impotent we are," said Diego Rizzo of the CFDT customs union.

Staff are under cost pressure to cut back on vehicle use and inspections are increasingly taking place after customs clearance, when goods have already reached factories, he said.

The European Commission rejects the "sieve" criticism. It notes that EU customs services seized almost 40 million counterfeit products worth nearly 1 billion euros last year, ranging from cigarettes to washing powder. China was the main source.

The Commission also says that from January, new rules will help catch look-alike trade marks and better track senders of goods to ensure they have the right to the trade mark.

"Customs will be able to provide greater protection for intellectual property rights and to better tackle the trade in infringing goods," Algirdas Semeta, the European commissioner responsible for customs, said in a speech.

Yet the EU executive admitted in a report to the European Parliament in January that "in numerous cases, the information in the declaration of entry of goods is not sufficiently precise to enable a good risk analysis".

This trend may accelerate with a new customs code that goes into force next month. Under the system, customs declarations may be registered at an office remote from the point of entry of the goods.

"We will have to establish rules of engagement to ensure it doesn't become a big sieve," a European Commission source said.