Belgium : Fraudulent imports of Chinese textiles & shoes, OLAF

A large-scale fraud scheme in imports of textiles and shoes from China has been discovered by the European Anti-Fraud Office (OLAF) in co-operation with the Austrian authorities.
Following close cooperation between the Austrian Finance Ministry, the Customs investigation services in Vienna and Wiener-Neustadt and OLAF, the cover was blown off a band of Chinese, Hungarian and Austrian citizens who have smuggled large quantities of textiles and shoes form the PR of China into the EU by means of heavily undervalued and false invoices.
Products involved were jeans, t-shirts and other clothes as well as various kinds of footwear including sports shoes and casual shoes.
The actual financial impact in customs duties and VAT in the present case cannot be accurately established yet, as the investigations are ongoing, but will run to millions of Euros. In addition, quantitative restrictions on the importation of Chinese textiles were circumvented.
The investigation revealed that mainly small customs clearance agents were used to do the customs clearance on behalf of Asian citizens. The goods were subsequently cleared in the Member State of arrival without paying the VAT and were then transported into another Member State of destination. In this scheme the majority of consignees are either non-existent or disappear from the scene after a short period in operation.
According to OLAF’s findings, this type of fraud (false origin and value declarations, up to 15 times lower than the actual value) is not limited to Austria alone but it appears to be a Europe-wide phenomenon. Several other Investigations in different Member States are ongoing.
The overall quantity of textiles and footwear affected by this type of fraud until now can be estimated at around 600,000 tons. The overall financial impact for the budget of the European Community would be more than 200 million Euros in customs duties alone.