Extract to table

Article 42(1) of the UCC provides that "[e]ach Member State shall provide for penalties for failure to comply with the customs legislation

" The provision goes on to specify that such penalties "shall be effective, proportionate, and dissuasive

This provision recognizes the member states' sovereign authority over penalty design and enforcement while maintaining the EU-level constraint that any penalties adopted must satisfy the effectiveness, proportionality, and dissuasiveness standard

The Regulation does not prescribe, for example, that a misclassification resulting in duty underpayment shall be subject to a penalty of a particular percentage of the underpaid duties

This risk must be actively managed through the mitigation strategies outlined in this memorandum

The ongoing accrual of interest during the administrative and legal proceedings introduces a time-value dimension to the dispute that must be actively managed