Earlier this year a client operating a long established (50 years plus) specialist wine importing and distribution business were declined their application for registration under Notice 2002: Alcohol Wholesaler Registration Scheme ('AWRS'). The grounds for the refusal related to a Director being associated with a company which had previously been liquidated for genuine commercial reasons, human errors made when utilizing the Excise Movement and Control System ('EMCS') during its implimentation and supposed inadequacies in the company's due diligence controls.

HM Revenue and Customs ('HMRC') decision to refuse the application was of course flawed and the Officer in question clearly either did not understand the due diligence controls in place or was trying to enforce requirements beyond the legal requirements of the AWRS. None the less the refusal necessitated an appeal in the First Tier Tax Tribunal by our client in order to obtain their registration.

How Did We Assist?

Our Director, Mr Mark Curley, prepared a witness statement pertaining to the due diligence and compliance services provided to the company and made strong representations to HMRC, prior to the case being heard, as to the actual legal requirements of Notice 2002. This evidence and witness statement were provided to HMRC's legal team as part of our client's skeleton argument and evidence bundle.

Upon receiving advice from their legal team, HMRC withdrew all grounds of refusal that related to our clients due diligence controls and the services provided by The Due Diligence Exchange Ltd. The witness statement and evidence provided by our Director was clearly so effective that HMRC were advised not to pursue the matter any further and withdraw these grounds from their refusal prior to the matter being seen in the Tribunal as it would likely weaken their case.

This has proven to provide another successful test of our due diligence procedures and reinforces that our systems and procedures are compliant and effective for the purposes of satisfying the legal requirements of Notice 2002: AWRS. This judgement should also prove useful to other businesses waiting for their cases to be heard in the Tribunal by setting a precedent as to the effectiveness of our due diligence controls and the legal requirements for FITTED due diligence under the Notice.