If you regularly import into the EU, you have probably already received a detention notice full of codes that you only half-understood. This is a compact reference for the terms that occur most frequently in practice, grouped by their usual occurrence in the handling process rather than alphabetically.
Terms regarding Customs Declaration and Procedures
Every shipment goes through a defined sequence of declarations before it is released. These are the terms that describe this sequence.
Customs Declaration: the electronic declaration that tells customs what is arriving, its value and origin, and which procedure should apply – and nothing passes the border before such a declaration has been accepted.
EORI Number: the Economic Operators Registration and Identification number, which must exist before any declaration can be submitted at all, valid throughout the EU once it has been assigned by a single member state.
MRN (Movement Reference Number): the unique reference number generated upon acceptance of a declaration, used to track a shipment or to prove that the goods have left the EU territory.
Special Procedures: an umbrella term for customs warehousing, inward processing, outward processing, temporary admission, and end-use – each of these suspends or reduces customs duties for goods that are not simply sold into free circulation, such as for storage before resale or repair before the goods leave the EU again.
Union Transit (T1/T2) and NCTS: the system that allows goods to move across internal EU borders or between the EU and countries like Switzerland and Norway before customs duties are settled. A T1 applies to goods that have not yet acquired Union status, while a T2 confirms that they already have it.
Release for Free Circulation: the point at which goods are no longer subject to customs supervision and become ordinary EU goods – the ultimate goal of most declarations.
Terms regarding Documentation
More than any single missing form, customs actually checks the consistency of the documentation. These are the documents that must match each other.
Commercial Invoice: The document showing the actual transaction value, the agreed Incoterms, and a concrete description of the goods – because a vague description like "electronic components" attracts attention that a precise description avoids. Vague descriptions are among the most common triggers for a closer customs inspection.
Packing List: Confirms that the number of boxes, weight, and dimensions match both the invoice and the physical cargo – a discrepancy here is a common trigger for a manual inspection.
Transport Document: A Bill of Lading, an Air Waybill, or a CMR consignment note, serving as proof of movement and often also as proof of ownership.
Certificate of Origin / EUR.1: Proves where goods were manufactured – relevant both for compliance and, if a trade agreement applies, for claiming a lower customs duty rate. The EUR.1 is the movement certificate, stamped by the customs authority of the exporting country.
Power of Attorney: The signed letter of authorization that allows a customs broker to submit declarations on behalf of the importer. Without it, a customs broker has no legal basis to act on your behalf.
Regulatory Certificates: A broad category of documents that apply only to specific goods: phytosanitary certificates for plants and food, safety data sheets for chemicals, CE declarations of conformity for electronics and machinery. If any of these is missing, the shipment is not only delayed – it can lead to complete refusal of import.
Terms regarding Customs, VAT and Taxes
This is about the numbers – and this is where an incorrect classification or misdeclaration has direct financial consequences.
Customs Value: Is usually calculated on a CIF basis, meaning customs duty and VAT are assessed on the price of the goods plus freight and insurance to the EU border, not just on the invoice price.
Ad Valorem vs. Specific Duty: Most EU customs duty rates are ad valorem, meaning a percentage of the customs value. A smaller group of goods, including certain agricultural and food products, is instead subject to a specific duty: a fixed amount per kilogram or unit, regardless of the price.
Anti-dumping and Countervailing Duties: Additional duties levied above the standard rate, which apply to specific products from certain countries where the EU has determined unfair pricing or subsidization. These can be significant, sometimes higher than the value of the goods themselves, and are one of the reasons why exact classification is so important.
Preferential Duty Rate: A reduced or zero rate available under a trade agreement, provided the origin can be proven by the correct document (a EUR.1, a REX declaration, or a supplier's declaration, depending on the agreement).
Import VAT: Charged in addition to customs duty, at the standard or reduced rate of the country of destination, on the customs value plus any customs duty already applied. It is refundable for VAT-registered businesses through the regular VAT return, but usually must first be paid at the border.
Customs Deferment Account: Allows a regular importer to settle customs duty and VAT monthly instead of shipment by shipment, easing cash flow; some member states also allow a form of deferred VAT accounting.
De Minimis Threshold: The value below which imports were historically exempt from customs duty, VAT, or both. This point requires special attention at the moment: The EU customs reform agreed upon in March 2026 abolishes the long-standing customs duty exemption up to €150 as of July 1, 2026. From this date, a flat transitional customs duty of €3 per item will apply until the EU Customs Data Hub for e-commerce is operational, expected around 2028, and a separate processing fee for handling small packages is to follow by November 2026 at the latest. Anyone shipping low-value packages to the EU should assume that the old thresholds no longer apply.
Classification Terms (CN Codes, HS Codes, TARIC)
Classification determines the duty rate, whether a license is required, and whether a product is subject to any restriction at all. If the code is incorrect, every downstream calculation is also incorrect.
HS Code: The Harmonized System code, a six-digit classification maintained by the World Customs Organization and used in some form by virtually every trading nation. It is the common language that allows a product to be identified in Rotterdam in the same way as in Shanghai.
CN Code: The Combined Nomenclature, the EU's own extension of two additional digits to a total of eight, capturing EU-specific details.
TARIC Code: Two additional digits on top of the CN code, totaling ten, and the level at which the EU links anti-dumping duties, quotas, bans, and licensing requirements to a specific product-origin combination.
Binding Tariff Information (BTI): A legally binding classification decision issued upon request of an importer, valid for three years throughout the EU, and the path to legal certainty for a genuinely ambiguous product. Importers can apply for a BTI decision electronically via the EU's centralized BTI service.
Terms regarding Border Clearance at the Port
These are the terms linked to the physical movement of goods: the part of the process that takes place at the terminal rather than on a screen.
ENS (Entry Summary Declaration): The advance security declaration to be submitted before the arrival of the goods, now submitted via ICS2 for every mode of transport – a late or inconsistent declaration can flag a shipment before it even reaches EU waters.
Customs Office of First Entry: The customs office responsible for the initial risk assessment upon arrival of the goods, not necessarily the same one that ultimately releases the goods for delivery. Centralized customs clearance arrangements now allow a declaration to be submitted to a customs office other than the one where the goods physically arrive.
Green, Yellow, and Red Channels: The three outcomes of a customs risk assessment: Green releases the goods immediately; Yellow requires a document check; Red triggers a physical inspection. Most declarations with clean, consistent documentation are routed green or yellow; Red remains reserved for higher risk profiles or random selection.
Demurrage vs. Detention: Two frequently confused charges – demurrage is charged by the terminal when a container sits in the port beyond its free time, while detention is charged by the shipping line when the container itself is held outside the port beyond its free time.
ISPM 15: The international standard requiring wood packaging material, including pallets and crates, to be heat-treated or fumigated and marked – untreated pallets remain a common, avoidable cause of detention.
EU-Specific Trade Terms (AEO, ICS2, REX)
A number of programs and systems exist specifically to make the EU customs system work on a large scale, and they constantly pop up once a business grows beyond occasional, low-volume shipments.
AEO (Authorised Economic Operator): A status as a trusted economic operator awarded after an audit of a company's compliance history, financial solvency and, depending on the type, security practices. AEOC covers customs simplifications, AEOS covers supply chain security, and AEOF combines both – recognized throughout the EU once granted by a single member state.
ICS2 (Import Control System 2): The EU platform for advance cargo information, now the uniform system for submitting an ENS for air, maritime, road, and rail transport, after replacing the predecessor system in phases up to 2025 and 2026.
REX (Registered Exporter System): The system that allows a registered exporter to self-certify preferential origin directly on the commercial invoice, instead of applying for a separate certificate for each shipment. Below a shipment value of €6,000, any exporter can make the same declaration without being registered at all – a threshold that smaller suppliers should know.
Worthy of mention in its own right: In March 2026, the EU agreed on a truly comprehensive customs reform, the largest since the creation of the Customs Union in 1968. In the coming years, it will introduce a new EU Customs Authority, a centralized EU Customs Data Hub, and a "Trust and Check Trader" status, which will reshape the AEO program in the long term. None of these terms will disappear overnight, but this glossary will have to be updated before the end of the decade.
Most of these terms only truly stick once they have cost you money or a week's delay. When a detention notice full of unfamiliar codes lands on your desk, that is usually the right moment to ask instead of guessing. Get in touch, and we will walk through what is actually required together.
