London Daily

Focus on the big picture.
Friday, Aug 08, 2025

UK negligent in failure to stop customs fraud, says senior EU lawyer

UK negligent in failure to stop customs fraud, says senior EU lawyer

Non-binding opinion says UK allowed criminal gangs to flood Europe with cheap Chinese-made clothes
A senior EU lawyer has concluded that the British government was negligent in its failure to tackle customs fraud that allowed criminal gangs to flood European markets with cheap Chinese-made clothes and shoes.

The non-binding opinion from a European court of justice legal expert does not recommend any penalty, but bolsters the position of Brussels authorities who have demanded the UK pay €2bn (£1.71bn) in compensation to the EU budget.

In a 139-page legal opinion published on Thursday, advocate-general Priit Pikamäe largely found in favour of the European Commission; he concluded the UK had “failed to fulfil its obligations” under EU law to collect the correct amount of customs duties and VAT on imported Chinese goods. The Estonian legal expert also said British authorities had not shown “sincere cooperation”, a key tenet of EU law. In particular, he criticised the UK for withholding a legal opinion believed to be the justification for HMRC to cancel 24 demands for payment to suspicious importers.

“The measures adopted by the United Kingdom were manifestly ineffective, in view of the characteristics of the fraud at issue and the knowledge that the United Kingdom authorities were able to have during the infringement period,” Pikamäe wrote.

While the views of advocates-general do not bind ECJ judges, the court often follows their advice.

His opinion is likely to raise tensions between London and Brussels, amid a simmering dispute about renegotiating the Brexit Northern Ireland protocol. Under the Brexit withdrawal agreement, the UK remains subject to ECJ jurisdiction for any breaches of EU law during its membership. The alleged failures by HMRC date from 2011 to 2017.

The European Commission launched the legal action in 2018 after the bloc’s anti-fraud office (Olaf) accused British authorities of failing to combat customs fraud that had allowed criminal gangs to evade EU customs duties, by making fake claims about clothes and shoes imported from China. Olaf said British authorities had been repeatedly warned about fraud and recommended a €1.98bn fine.

According to fraud investigators, in 2016 more than 50% of all textiles and footwear imported into the UK from China were below “the lowest acceptable prices”, a calculation based on production costs.

The case emerged after a 2005 decision championed by then EU trade commissioner Peter Mandelson to abolish quotas on textiles and clothing from all World Trade Organization countries, including China. In following years, EU fraud officials became concerned that importers were using fake invoices that undervalued clothes and shoes made in China. Raising the alarm in 2014, the EU’s anti-fraud office launched Operation Snake to check import declarations. This included a method to calculate undervalued goods.

British customs officials declined to use the EU method, arguing it was counterproductive and disproportionate. In court, the UK defence team said customs officers had done everything required to combat fraud, arguing that EU law did not mandate any method to calculate undervalued goods. The government was supported by six member states: Belgium, Estonia, Greece, Latvia, Portugal and Slovakia.

The advocate-general rejected their arguments and recommended that the UK and six supporting countries pay their own costs. He also wants the UK to pay four-fifths of the European Commission’s legal bill.

Other member states, notably France, have accused the UK of failing to help tackle fraud. The case touches all EU member states, as 80% of customs duties collected at the EU’s external borders go to the common budget.

A HMRC spokesperson said it was considering the opinion, noting that the court may arrive at a different judgement. “The UK has always denied liability in the case. But even if the CJEU were to find the UK in breach of EU law, we consider that the Commission has greatly overstated the size and severity of the alleged fraud. We take customs fraud very seriously and continue to evolve our response as new threats emerge.”

The ECJ judgement is expected in early to mid 2022.
Newsletter

Related Articles

0:00
0:00
Close
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
OpenAI Launches GPT‑5, Its Most Advanced AI Model Yet
Embarrassment in Britain: Homelessness Minister Evicted Tenants and Forced to Resign
President Trump nominated Stephen Miran, his top economic adviser and a critic of the Federal Reserve, to temporarily fill an open Fed seat
The AI-Powered Education Revolution: Market Potential and Transformative Impact
Chikungunya Virus Outbreak in Southern China: Over 7,000 Hospitalized
French wine makers have seen catastrophic damage to vines that were almost ready to be harvested after the worst fires in more than 70 years burned through the south of the country
US Lawmaker Probes Intel CEO’s China Ties Amid National Security Concerns
Brazilian President Lula says he’ll contact the leaders of BRICS states to propose a unified response to U.S. tariffs
Trump Open to Meeting Putin as Soon as Next Week, with Possible Trilateral Summit Including Zelenskiy
Katy Perry and Justin Trudeau spark dating rumors, joining high stakes world of celeb-politician romances
US envoy Steve Witkoff arrived in Moscow to seek a breakthrough in the Ukraine war ahead of President Trump’s peace deadline
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Nine people have been hospitalized and dozens of salmonella cases have been reported after an outbreak of infections linked to certain brands of pistachios and pistachio-containing products, according to the Public Health Agency of Canada
Karol Nawrocki Inaugurated as Poland’s President, Setting Stage for Clash with Tusk Government
Trump Signals JD Vance as ‘Most Likely’ MAGA Successor for 2028
US Charges Two Chinese Nationals for Illegal Nvidia AI Chip Exports
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
U.S. Tariff Policy Triggers Market Volatility Amid Growing Global Trade Tensions
Tariffs, AI, and the Shifting U.S. Macro Landscape: Navigating a New Economic Regime
Representative Greene Urges H-1B Visa Cuts Amid U.S.-India Trade Tensions
U.S. House Committee Subpoenas Clintons and Senior Officials in Epstein Investigation
Sydney Sweeney Registered as Republican as Controversial American Eagle Ad Sparks Debate
Trump Accuses Major Banks of Politically Motivated Account Denials and Prepares Executive Order
TikTok Removes Huda Kattan Video Over Anti-Israel Conspiracy Claims
Trump Threatens Tariffs on India Over Russian Oil Imports
German Finance Minister Criticizes Trump’s Attacks on Institutions
U.S. Proposes Visa Bond of Up to $15,000 for Some Applicants
U.S. Farmers Increase Lobbying Amid Immigration Crackdown
Elon Musk Receives $23.7 Billion Tesla Stock Award
Texas House Paralyzed After Democrats Walk Out Over Redistricting
Mexican Cartels Complicate Sheinbaum’s U.S. Security Talks
Mark Zuckerberg Declares War on the iPhone
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
OpenAI’s Bold Bet: Teaching AI to Think, Not Just Chat
Tesla Seeks Shareholder Approval for $29 Billion Compensation Package for Elon Musk
Nvidia is cutting prices on its RTX 50-series graphics cards after sales slowed and inventories piled up
Ghislaine Maxwell Transferred to Minimum-Security Prison Amid Ongoing DOJ Discussions
U.S. Tariffs Surge to Highest Levels in Nearly a Century Under Second Trump Term
Matt Taibbi Slams Media for Role in Russiagate Narrative
Pilots Call for Mental Health Support Without Stigma
All Five Trapped Miners Found Dead After El Teniente Mine Collapse
Ong Beng Seng Pleads Guilty in Corruption Case Linked to Former Singapore Transport Minister
BP’s Largest Oil and Gas Find in 25 Years Uncovered Offshore Brazil
Italy Fines Shein One Million Euros for Misleading Sustainability Claims
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
Declassified Annex Links Soros‑Affiliated Officials and Clinton Campaign to ‘Russiagate’ Narrative
×