CDS is intended to replace the existing Customs Handling of Import and Export Freight (CHIEF) system, which is now nearly 25 years old, over three phases between August 2018 and early 2019.

It was originally specified prior to the EU referendum in 2016, and designed to upgrade older technology and deliver a system to meet the requirements of the Union Customs Code (UCC), support the anticipated future import and export growth of the UK, and provide businesses with access to more of their customs information in one place.

HMRC has said CDS will be scaled to handle any potential increases in the volume of declarations that may result from the UK’s exit from the EU, which will depend on the final form of any trading agreement.

Following implementation of the first release of CDS on 14 August, a selected group of importers will start making certain types of supplementary declarations on CDS.

The majority of importers will start using CDS from November, once their own software provider or in-house IT team has completed development of CDS-compatible software. Exporters will follow after this. CHIEF will continue to operate in parallel while the transition of traders takes place.

Kevin Franklin, HMRC’s customs transformation programme director, said: ‘The first release of the new CDS is a major milestone.

‘We have been engaging closely with trade representatives including software developers, community system providers, freight forwarders, and traders themselves about CDS and we value the support from these organisations in preparing importers and exporters for the upcoming changes.

‘Our priority now is to make sure software developers, agents and their clients are ready and we will continue to work closely with them throughout the transition.’

Franklin explain that, when fully rolled out, CDS will offer several new and existing services all in one place, and due to requirements of the UCC, some additional information will need to be collected and included in import and export declarations. This means importers, exporters and agents will need to work with their in-house or external software developers to understand the impact these changes will have on their businesses.

The changes for exports will be available on gov.uk later in the year.

Brad Ashton, customs and international trade partner at RSM, said depending on the outcome of Brexit negotiations, an additional 145,000 companies who trade solely with the EU might be required to make customs declarations for the first time starting in March next year.

Post Brexit, the number of customs declarations is expected to increase from around 55m currently to around 255m each year.

Ashton said: ‘It’s hard to overestimate the importance of this project for HMRC – and for the nation’s importers and exporters.

‘The new CDS was planned well before the referendum, but our imminent exit from the EU has made the successful implementation of the CDS programme absolutely vital.

 ‘It’s important to note that this is only a partial launch with further functionality earmarked for rollout in November and December. Timing is therefore very tight indeed, and there’s a real risk of there being too little time to resolve any operational or system issues that may occur before the final rollout.’

Report by Pat Sweet