The Canmi Case: How a Direct Agent Became the Centre of a Landmark Excise Duty Battle
A review of Canmi Ltd v His Majesty's Revenue and Customs [2025] UKFTT 890 (TC).
When Canmi Limited submitted routine customs declarations for importers of Nigerian beer in 2016, it could not have anticipated that years later it would find itself fighting a legally significant battle against HMRC. The case now sits at the heart of the debate over can the agent who submits customs paperwork be held jointly and severally liable for the misdecalaration by an importer?
This dispute raises questions that go far beyond the parties. It reshapes how freight agents, clearing agents, and logistics companies operate across the UK.
At the core lies one question:
Can a direct representative, acting purely on behalf of an importer, be held jointly and severally liable for unpaid excise duty?
The First‑tier Tribunal (FTT) answered “yes”, and the Upper Tribunal (UT) has now refused permission to appeal. The judgments make clear that, under the UK’s excise regime, any person “involved in the importation” of excise goods can be liable on a strict basis, regardless of knowledge , benefit and their remotness to the facts and that includes a direct agent who completes and submits customs declarations.
Background: The Imports and the Dispute
Between April and November 2016, Canmi acted as a direct representative for an importer of Nigerian beer.
The case was one of a wider cohort: Canmi had acted for many importers on similar entries (35 appeals in total), so the tribunal case‑managed this appeal as the lead case; the others were stayed pending outcome.
Between April and November 2016, Canmi acted for several importers, including Ms Miriam Bumah (the lead case), in clearing shipments of Nigerian beer into the UK. Each importer expressly instructed Canmi that the beer qualified for small brewery relief. Canmi submitted C88 import entries and used tax type code 443 (small brewery relief), which reduces excise duty where the beer is produced by a small brewery; HMRC concluded the correct code was 473 (standard rate), and treated the under‑declarations as irregular importations. HMRC issued an assessment against the importers and joint and several liability notices to Canmi; Canmi appealed. The FTT heard the case in January 2024 and July 2025.
This triggered 35 separate appeals by Canmi.
How the Lead Case Was Selected
Canmi’s work spanned dozens of importers, with HMRC raising corresponding decisions across the set. The facts and law materially overlapped: the role of a direct representative, who is the declarant, and whether regulation 12(2) imposes strict, involvement‑based liability in an irregular importation.
To avoid duplicative hearings and inconsistent outcomes, the Tribunal and parties treated one appeal (Miriam Bummah) as the lead case and stayed the remaining appeals pending the outcome. As time passed, several importers paid the assessments either fully or partially, but the core issues remained live for the stayed cases. HMRC refused to withdraw the joint and several liability notice for those appeals which had been fully paid by the importers. The appeals continued on an academic point.
The FTT’s judgment determined the approach across the stayed matters.
Canmi’s Arguments
Canmi’s case was consistent and legally detailed.
Canmi was a direct representative, not the declarant.
Canmi explicitly declared direct representation on each C88 and held written authority from the importers. Under customs law, the importer, not the agent, is the declarant. Should established principle under customs law be extended to excise duties?
No knowledge: Canmi was an “innocent agent”
The Tribunal found as fact that:
- Canmi had no actual or constructive knowledge and that the small brewery relief did not apply.
- The importer provided all information; Canmi had no way to verify the goods in Nigeria.
- Regulation 12 is not strict liability
HMRC’s interpretation, that any involvement triggers liability, is said to be:
- a misreading of the legislation
- inconsistent with EU law
- unfair and disproportionate
Even if liable, Canmi is a secondary debtor
The importer is the primary debtor. HMRC must pursue them first, exhaust all avenues and then seek to recover monies from Canmi.
Canmi’s Case (as run) — and Why it Failed
Canmi’s arguments were sophisticated and wide‑ranging. The FTT judgment records the following principal contentions and explains why each one failed:
1. “Involvement must be more than de minimis and/or require knowledge”
Canmi's position was that administrative acts by a disclosed direct agent were too remote to count as “involvement” under reg 12(2), or that at least knowledge/benefit/control should matter.
The FTT held the opposite:
- Reg 12(2) does not impose any knowledge or benefit threshold;
- “Involvement” is an ordinary English word and the tribunal found it aptly describes completing and submitting the C88 and paying duty;
- CJEU and Court of Appeal authority in WR/Perfect supports a non‑fault approach where the provision does not mention knowledge.
2. “Customs law (direct v indirect representation) controls excise liability”
Canmi urged the tribunal to compare the customs distinction of agents and imply it into the exicse regulations as the excise regulations do not stipulate for a similar distinction. Canmi referred the FTT to the CJEU's decision in Dansk Transport og Logistik v Skatteministeriet Case C‑230/08 and the wording of the Recast Directive 2020/262. The FTT rejected this proposal:
- The customs code concerns customs debts, not excise;
- Article 8 of the Excise Directive and reg 12 answer the liability question expressly;
- Dansk was a case where excise legislation was silent on a particular point; here it isn’t; and
- The Recast Directive post‑dates the events and does not retrospectively alter Art 8’s meaning.
3. “Agency law shields a disclosed direct agent from principal’s liabilities”
The tribunal accepted the general agency principle in private law, but held that statutory liability under reg 12(2) overrides private law concepts; the provision catches “any person involved”, and the tribunal found Canmi was involved.
4. “Criminal standard of proof should apply”
Canmi suggested the allegations were quasi‑criminal (akin to aiding/abetting), so a higher standard applied. The FTT held that civil standard applies; no dishonesty was alleged; and burden was otherwise on Canmi under FA 1994 s16(6) to make out its appeal grounds.
5. “Recast Directive can interpret earlier law”
The FTT found the Recast Directive has no retroactive effect and, in any event, reg 12 is unambiguous; the Recast could not be used to re‑engineer the earlier regime for these imports.
Bottom line: the FTT dismissed the appeal on 22 July 2025, finding that Canmi (a direct agent) was “involved in the importation”: completing and filing C88 entries and paying duty are central steps in an import process, and reg 12(2) imposes joint and several liability in irregular importation cases irrespective of knowledge.
Permission to Appeal: Refused Twice
After the merits decision, Canmi sought permission to appeal.
On 31 October 2025, the FTT refused permission, addressing each of Canmi’s six grounds and concluding there was no real prospect of success. Among other points, the FTT said the “involvement” test is unqualified; any de minimis gloss or knowledge threshold is not in the text, and the tribunal’s reading accords with Perfect and Hartleb.
On 22 January 2026, UT Judge Anne Redston refused permission on the papers. The UT emphasised that reg 12(2) is clear and that reliance on WR/Perfect supports strict liability even where the person involved is an innocent agent; the UT also upheld the FTT’s case‑management refusal of the very late amendment.
The upshot is procedural finality unless an oral renewal leads to a different outcome (the UT’s notice carefully explains that step). As things stand, the FTT’s dismissal remains in place.
The Key Takeaways from the Judgments
(A) “Involvement” is broad and does not import a mental element
“Involvement” under reg 12(2) carries no knowledge requirement and no “benefit or control” filter; if the person’s acts form part of the importation process (e.g., preparing and submitting declarations, calculating and paying duty), that is involvement.
(B) Strict liability is compatible with the Excise Directive’s purpose
WR/Perfect teaches that where the legislation does not stipulate knowledge, strict liability advances the Directive’s revenue‑protection aim: “someone must be held responsible.” The FTT and UT aligned with that policy rationale.
(C) Customs law analogies will not override reg 12(2)’s wording
The direct/indirect distinction from the UCC does not prevent a direct agent from being an “other person involved” in an irregular importation. The customs concepts are useful background, but they do not displace the express excise rule.
(D) Private law agency principles cannot confine a statutory excise liability
Even if a direct agent is normally shielded from a principal’s liabilities in the case of customs duties, Parliament and the EU legislature can impose statutory duties on any person involved; that is what reg 12(2) does.
(E) Late amendments face a high hurdle
Attempts to add new points (e.g., that HMRC must first exhaust remedies against the importer) very late in the day will usually fail unless there is clear justification and a workable draft.
What This Means for Agents and Importers
For freight forwarders and customs agents
- Direct agents can be liable for excise on irregular importations by virtue of “involvement” alone. The role of “just a form‑filling agent” does not insulate against reg 12(2).
- Knowledge is not the touchstone. Even where agents have no actual or constructive knowledge, they can still be liable if their actions constitute involvement.
Risk management now demands:
- tightening client onboarding and written authorisations;
- contractual indemnities and cost recovery mechanics;
- scrutinising duty code choices where a relief is claimed (e.g., small brewery relief) and retaining documentary support; and
- considering insurance for excise exposure tied to client declarations.
For importers
- The decision does not absolve importers; rather, it adds a solvent target. HMRC may pursue either or both jointly and severally liable persons. Good‑faith importers must maintain robust documentation proving eligibility for reliefs.
For trade bodies and advisers
- Expect updated guidance, training and template clauses to reflect strict involvement‑based liability under reg 12(2). The Recast Directive remains important going forward, but the tribunals have signalled that past periods are governed by the plain text of the 2010 Regulations.
Frequently Asked Questions (Practical Perspective)
Q1. Does it matter that I am a “direct” (not indirect) representative?
Not for irregular importations when it comes excise duty debt. The FTT made clear that, for reg 12(2), the customs distinction does not exclude a direct agent from being “involved.” in relation to excise duties.
Q2. If my client told me to use a relief code and I relied on that, am I safe?
Not necessarily. If the importation is later found to be irregular, your contribution (submitting the C88, calculating duty) may still be “involvement”. Ensure you keep evidence of the client’s instructions and any supporting certificates when a relief is claimed. You must ask for and keep a record of any certificates or other evidence which authorise the client to use any relief codes.
Q3. Can HMRC choose me instead of the importer?
Yes. Joint and several liability allows HMRC to pursue any liable person in full. Allocation between you and your client is then a private matter (contract/indemnities).
Q4. Is there any scope left to argue proportionality?
The tribunals’ reliance on WR/Perfect and the plain text of reg 12(2) narrows the room for proportionality arguments where the provision is clear and does not require knowledge.
The Procedural Epilogue: Permission to Appeal
The FTT refused permission to appeal on 31 October 2025, and the UT refused permission on 22 January 2026, finding no arguable error of law. The UT reiterated that reg 12(2) can make an innocent agent liable and that the tribunal’s case‑management call on late amendments was well within discretion. FTT’s decision stands.
Final Word
Canmi is now a leading modern statement of the strict, involvement‑based liability regime that applies to irregular importations of excise goods. It confirms that declared status as a direct agent is not a shield under reg 12(2). For the sector, the watchwords are documentation, due diligence, indemnities, and insurance.
The case also underscores a broader principle: where excise goods are released for consumption, the law prioritises revenue protection and assigns liability broadly so that “someone” is responsible. For freight agents and import facilitators, that “someone” may now be them.
-------
The Legal Framework
Should you be interested, the legal provisions discussed are as follows:
Assessment to excise duty
Section 12 of the Finance Act 1994 (“FA1994”) states as follows:
“12 Assessments to excise duty.
…………
1A Subject to subsection (4) below, where it appears to the Commissioners—
(a) that any person is a person from whom any amount has become due in respect of any duty of excise; and
(b) that the amount due can be ascertained by the Commissioners, the Commissioners may assess the amount of duty due from that person and notify that amount to that person or his representative.
…………
(8)In this section “representative”, in relation to a person appearing to the Commissioners to be a person from whom any amount has become due in respect of any duty of excise, means his personal representative [F24, trustee in bankruptcy or interim or permanent trustee,] any receiver or liquidator appointed in relation to that person or any of his property or any other person acting in a representative capacity in relation to that person.”
Canmi argued that the above section does not envisage assessing anyone who acts purely in the capacity of a representative. This includes a direct representative but not an indirect representative.
Tribunal powers
S14(2) of FA1994 provides an appeal for reviewing a decision to impose customs duty or the amount of duty. The Tribunal's jurisdiction is conferred by S16 of FA1994. The powers of the Tribunal are contained in Section 16(5). The relevant parts of that section provide as follows:
“In relation to other decisions, the powers of an appeal Tribunal on an appeal under this section shall also include power to quash or vary any decision and power to substitute their own decision for any decision quashed on appeal”.
Burden of proof
The burden of proof is addressed in S16(6) FA1994, which provides as follows:-
“On an appeal under this section the burden of proof as to …………
shall lie upon the Commissioners; but it shall otherwise be for the Appellant to show that the grounds on which any such an appeal is brought have been established”.
The 2008 directive
Council Directive 2008/118/EC (concerning the general arrangements for excise duty and repealing Directive 92/12/EEC) ("2008 Directive") harmonises the principles to be applied across the EU concerning the point at which excise duty is levied on excise goods and the duty-suspended movement of goods between Member States.
Chapter II of the Directive headed "Chargeability, Reimbursement, Exemption" contains general provisions about those aspects of excise duty. Under section 1, headed "time and place of chargeability", Article 7 of the Directive provides, inter alia :
"(1) Excise duty shall become chargeable at the time, and in the Member State, of release for consumption
(2) For the purposes of this Directive, 'release for consumption' shall mean any of the following:
………
(d) the importation of excise goods, including irregular importation, unless the excise goods are placed, immediately upon importation, under a duty suspension arrangement."
Article 8 provides, so far as relevant to this appeal:
“1. The person liable to pay the excise duty that has become chargeable shall be:
………
(d) in relation to the importation of excise goods as referred to in Article 7(2)(d): the person who declares the excise goods or on whose behalf they are declared upon importation and, in the case of irregular importation, any other person involved in the importation.
2. Where several persons are liable for payment of one excise duty debt, they shall be jointly and severally liable for such debt.”
The Appellant is not a person “involved in the importation” of the alcohol contrary to Article 8 (1) (d) above. To be involved the Appellant would need to offer services other than merely completing a form and paying the applicable tax on account on behalf of the Importers. The Appellant would have to be acting as an indirect agent.
The 2010 regulations
Parliament has given effect to the 2008 Directive via the 2010 Regulations introduced under the Finance (No.2) Act 1992.
Part 2 of the 2010 Regulations contains rules concerning excise duty points and payment of the duty. Regulations 5 to 7 contain rules concerning the excise duty point for goods released for consumption in the UK. Regulations 8 to 12 contain rules concerning the persons liable to pay duty in respect of goods released for consumption in the UK.
Regulation 12 gives effect to Article 8 of the 2008 Directive, see copied above. Regulation 12 stipulates as follows:
“(1) The person liable to pay the duty when excise goods are released for consumption by virtue of regulation 6(1)(d) (importation of excise goods that have not been produced or are not in free circulation in the EU) is the person who declares the excise goods or on whose behalf they are declared upon importation.
(2) In the case of an irregular importation any person involved in the importation is liable to pay the duty.
(3) Where more than one person is involved in the irregular importation, each person is jointly and severally liable to pay the duty.”
Regulation 12 of the 2010 Regulations also confirms that in the case of an irregular importation any person involved in the importation can be held liable to pay the duty. Canmi argued that it was not ‘involved in the importation’ of the alcohol.
The Community Customs Code
Regulation 2913/92, the Community Customs Code (“CCC”) provides clarification in regards to the role of a representative in relation to declarations made on behalf of an importer.
Article 4 of the CCC states as follows:
“For the purposes of this Code, the following definitions shall apply: .........
(18) ‘Declarant’ means the person making the customs declaration in his own name or the person in whose name a customs declaration is made.”
Article 5 stipulates that:
“(1) Under the provisions set out in Article 64(2) and subject to the provisions adopted within the framework of Article 243(2)(b), any person may appoint a representative in his dealings with the customs authorities to perform acts and formalities laid down by customs rules.
(2) Such representation may be:
-direct, in which case the representative shall act in the name of and on behalf of another person, or
-indirect, in which case the representative shall act in his own name but on behalf of another person.
A Member State may restrict the right to make customs declarations:
-by direct representation, or
-by indirect representation, so that the representative must be a customs agent carrying on his business in that country’s territory.
(3) Save in the cases referred to in Article 64(2)(b) and (3), a representative must be established within the Community.
(4) A representative must state that he is acting on behalf of the person represented, specify whether the representation is direct or indirect, and be empowered to act as a representative. A person who fails to state that he is acting in the name of or on behalf of another person or who states that he is acting in the name of or on behalf of another person without being empowered to do so shall be deemed to be acting in his own name and on his own behalf.
(5) The customs authorities may require any person stating that he is acting in the name of or on behalf of another person to produce evidence of his powers to act as a representative.
Article 64(1)
Subject to Article 5, a customs declaration may be made by any person who is able to present the goods in question or to have them presented to the competent customs authority, together with all the documents which are required to be produced for the application of the rules governing the customs procedure in respect of which the goods were declared.
(2) However,
(a) Where the acceptance of a customs declaration imposes particular obligations on a specific person, the declaration must be made by that person or on his behalf;
(b)The declarant must be established in the Community.”
Further to Article 5(4) the Appellant declared on each C88 relating to the imports under review that it acted as a direct representative.
The Union Customs Code
Article 15 of the UCC stipulates the provision of information to customs authorities, the Appellant maintains that all information has been provided as requested by the Respondents, in fact the Respondents were given free access to the Appellant’s archive warehouse and its computer system to take what the Respondents wanted.
In so far as relevant Article 15 reads:
1. Any person directly or indirectly involved in the accomplishment of customs formalities or in customs controls shall, at the request of the customs authorities and within any time-limit specified, provide those authorities with all the requisite documents and information, in an appropriate form, and all the assistance necessary for the completion of those formalities or controls.
2. The lodging of a customs declaration, temporary storage declaration, entry summary declaration, exit summary declaration, re-export declaration or re-export notification by a person to the customs authorities, or the submission of an application for an authorisation or any other decision, shall render the person concerned responsible for all of the following:
(a)the accuracy and completeness of the information given in the declaration, notification or application;
(b)the authenticity, accuracy and validity of any document supporting the declaration, notification or application;
(c)where applicable, compliance with all of the obligations relating to the placing of the goods in question under the customs procedure concerned, or to the conduct of the authorised operations.
The first subparagraph shall also apply to the provision of any information in any other form required by, or given to, the customs authorities.
“Where the declaration or notification is lodged, the application is submitted, or information is provided, by a customs representative of the person concerned, as referred to in Article 18, that customs representative shall also be bound by the obligations set out in the first subparagraph of this paragraph.”
Article 18 specifies the role of a customs representative, it states:
“Section 2 - Customs representation
Article 18 - Customs representative
1. Any person may appoint a customs representative.
Such representation may be either direct, in which case the customs representative shall act in the name of and on behalf of another person, or indirect, in which case the customs representative shall act in his or her own name but on behalf of another person.
2. A customs representative shall be established within the customs territory of the Union.
Except where otherwise provided, that requirement shall be waived where the customs representative acts on behalf of persons who are not required to be established within the customs territory of the Union.
3. Member States may determine, in accordance with Union law, the conditions under which a customs representative may provide services in the Member State where he or she is established. However, without prejudice to the application of less stringent criteria by the Member State concerned, a customs representative who complies with the criteria laid down in points (a) to (d) of Article 39 shall be entitled to provide such services in a Member State other than the one where he or she is established.
4. Member States may apply the conditions determined in accordance with the first sentence of paragraph 3 to customs representatives not established within the customs territory of the Union.”
Article 19 relates to the custom’s representatives’ empowerment, it reads as follows:
Article 19 - Empowerment
1. When dealing with the customs authorities, a customs representative shall state that he or she is acting on behalf of the person represented and shall specify whether the representation is direct or indirect.
Persons who fail to state that they are acting as a customs representative or who state that they are acting as a customs representative without being empowered to do so shall be deemed to be acting in their own name and on their own behalf.
2. The customs authorities may require persons stating that they are acting as a customs representative to provide evidence of their empowerment by the person represented.
In specific cases, the customs authorities shall not require such evidence to be provided.
3. The customs authorities shall not require a person acting as a customs representative, carrying out acts and formalities on a regular basis, to produce on every occasion evidence of empowerment, provided that such person is in a position to produce such evidence on request by the customs authorities.
Article 51 stipulates further in relation to the keeping of information.
“Section 8 - Keeping of documents and other information, and charges and costs
Article 51 - Keeping of documents and other information
1. The person concerned shall, for the purposes of customs controls, keep the documents and information referred to in Article 15(1) for at least three years, by any means accessible by and acceptable to the customs authorities.
In the case of goods released for free circulation in circumstances other than those referred to in the third subparagraph, or goods declared for export, that period shall run from the end of the year in which the customs declarations for release for free circulation or export are accepted.
…………”
Article 77 of the UCC reads in relation to the customs debt as follows:
“TITLE III -CUSTOMS DEBT AND GUARANTEES
CHAPTER 1 - Incurrence of a customs debt
Section 1 - Customs debt on import
Article 77 - Release for free circulation and temporary admission
1. A customs debt on import shall be incurred through the placing of non-Union goods liable to import duty under either of the following customs procedures:
(a) release for free circulation, including under the end-use provisions;
(b) temporary admission with partial relief from import duty.
2. A customs debt shall be incurred at the time of acceptance of the customs declaration.
3. The declarant shall be the debtor. In the event of indirect representation, the person on whose behalf the customs declaration is made shall also be a debtor.
Where a customs declaration in respect of one of the procedures referred to in paragraph 1 is drawn up on the basis of information which leads to all or part of the import duty not being collected, the person who provided the information required to draw up the declaration and who knew, or who ought reasonably to have known, that such information was false shall also be a debtor.”
The cases referred to
WR / Perfect Case C‑279/19 (2 June 2022)
Dansk Transport og Logistik v Skatteministeriet Case C‑230/08 (29 April 2010)
HMRC v Perfect [2019] EWCA Civ 465
R v Tatham [2017] EWCA Crim 1103
Taylor & Wood v Commissioners of Customs & Excise [1963] 1 WLR 955
Barwick v English Joint Stock Bank (1867) LR 2 Ex 259
HMRC v Katib [2019] UKUT 189 (TCC)
TNT (UK) Ltd v HMRC [2012] UKUT 104 (TCC) / [2012] STC 1232
Perfect v HMRC [2017] UKUT 476 (TCC)
GB Seed Ltd v HMRC [2012] UKFTT 343 (TC)
TNT (UK) Ltd v HMRC [2011] UKFTT 38 (TC)
Perfect v HMRC [2015] UKFTT 639 (TC)
Bediako v HMRC [2016] UKFTT 280 (TC)
Storefast Ltd v Commissioners of Customs & Excise Decision C00030 (1996)
HAMMAD BAIG © 2026
BARRISTER
33 BEDFORD ROW
Hammad Baig practices in the following areas: international trade, indreict tax, insolvency, commercial arbitration, public law and commercial litigation with a specific interest in Customs and Excise Law.
Further articles on topics relating to his practice areas can be read under his Insights and on his blog. Should you wish to instruct Hammad Baig then please do not hesitate to contact his clerk Geoff Carr.
NOTICE: This article is provided free of charge for information purposes only; it does not constitute legal advice and should not be relied on as such. No responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by any member of Chambers or by Chambers as a whole.