Ukraine's switch over to NCTS Phase 5 postponed again at businesses' request

MOSCOW. Dec 1 (Interfax) - Ukraine's State Customs Service and the Directorate-General for Taxation and Customs Union (DG TAXUD) have agreed to postpone Ukraine's transition to the New Computerized Transit System (NCTS) Phase 5, initially set for December 1, 2023, to a later date.

"Business representatives voiced concern about the switch over to NCTS Phase 5 from December 1, 2023, citing the need for additional time to test the brokerage software and preparations by companies themselves for the new approaches," Ukrainian media quoted the State Customs Service as saying in a statement.

The decision will give brokerage software developers more time to test their systems' functions to exchange data with the new NCTS Phase 5 software of the State Customs Service, it said.

In order to minimize risks for businesses in light of the transition to NCTS Phase 5, the State Customs Service has already signed a contract to develop a Trader's Portal, an IT solution that will act as an alternative to the brokerage software for submitting NCTS Phase 5 declarations, it said.

The new Trader's Portal is expected to become available to businesses at the end of the first quarter of 2024.

"The State Customs Service has pledged to carry out the transition to NCTS Phase 5 no later than May 1, 2024, taking into account the preparedness of the new Trader's Portal and/or brokerage software for full-fledged interaction in compliance with NCTS Phase 5 requirements," it said.

Ukraine has successfully completed all stages of the NCTS Phase 5 system's testing determined by DG TAXUD as part of Conformance Testing, the service said. The Conformance Testing results confirmed the performance efficiency of the system deployed within the State Customs Service and its ability to interact with other Convention on the Common Transit Procedure member countries as part of NCTS Phase 5.

As reported, Ukraine's State Customs Service in January 2023 published software update specifications for developers of brokerage software (bit.ly/3NwC9pk). In August 2023, national software developers were granted access to API to test message exchanges with NCTS Phase 5. The State Customs Service also said that it was actively interacting with the relevant teams to ensure that brokerage IT solutions are ready.

The State Customs Service announced in mid-August that the transition to NCTS Phase 5 would be postponed by two months, until November 1, to give businesses more time to prepare for work with the new system and the new requirements for filling out transit declaration. The service said then that Ukraine would switch to NCTS Phase 6 by June 2025.

NCTS is one of the 17 customs IT systems Ukraine will have to introduce before being admitted to the European Union. So far, it is the only system that Ukraine has joined. The introduction of an IT system involves not only its installation but also its synchronized development with other member countries of the Common Transit Convention.