Most finance leaders will have missed it, but earlier this month, the First-tier Tribunal handed down its decision on several preliminary issues in UNIVERSAL CYCLES and Others v HMRC. The appellants, all part of the Frasers Group, are challenging a 2017 assessment of more than £23 million in anti dumping duties (ADD) on bicycles imported from Sri Lanka between 2009 and 2011.

On paper, it looks like an early victory for Frasers. HMRC’s case appears vulnerable on procedural grounds relating to the burden of proof and debtor notification. However, the main hearing is still to come, and the risk for other importers remains very real.

The background

HMRC challenged Frasers Group’s import declarations on the basis that bicycles originating in China had been routed via Sri Lanka in a way that avoided anti-dumping duty. These are the same issues that were decisive in HMRC’s recent £4.7 million win against Morrisons, where the tribunal ruled that minor processing in Thailand was insufficient to change a product’s origin.

In Frasers’ case, HMRC’s position may fail not because its ADD argument is wrong, but because the department may not have directed its assessment at the correct legal entity and may not have met the burden of proof required to sustain a claim more than three years after the import date.

The takeaway is clear: Frasers may have won this round, but only because of a technicality.

Why finance leaders should care

For finance teams, this is not a theoretical risk; it is a genuine concern. Anti-dumping duties can reach 30 to 50 per cent of a product’s value, and HMRC can revisit imports going back three years or even longer in cases involving special circumstances. In Frasers’ case, the duty demands were issued six to eight years after the goods were imported.

The financial consequences extend beyond ADD itself. Additional impacts can include import VAT, penalties, interest, restated margins and prior period adjustments.

More importantly, HMRC’s approach is becoming more forensic. The Morrisons and Frasers cases demonstrate that HMRC is willing to apply established EU case law, utilise open-source evidence, pursue large and well-advised importers, and reopen historic declarations long after the fact.

Frasers may have avoided liability this time, but HMRC’s underlying argument remains intact. The department is unlikely to repeat the same procedural errors.

A pattern is emerging

The line between processing and manufacturing is far thinner than many businesses assume. In Morrisons, finishing steps carried out in Thailand were not enough to confer Thai origin. In Frasers, we are still awaiting the details from the main hearing, but the core argument remains active.

Frasers’ disputes arise from assessments issued many years after the original imports were made. These long tail cases highlight a structural risk: customs is not a point-in-time compliance exercise. It is a financial exposure that can crystallise many years after the goods have moved through the border.

This means businesses must retain detailed origin evidence, supplier documentation, contractual records, technical product descriptions, internal decision-making notes and import files. Without these records, companies may find themselves attempting to defend historic decisions made by teams or suppliers who are no longer involved.

Taken together, the Morrisons and Frasers cases show that HMRC’s scrutiny of non-preferential origin and anti-dumping exposure is intensifying, and many importers are unprepared for it.

So what should businesses do?

Finance leaders do not need to become customs specialists. However, they do need assurance at the same level expected in other areas of tax and risk.

A periodic, independent customs review is essential. It allows businesses to test origin positions, validate supplier claims, identify misclassifications, review supporting evidence, assess historic exposure and evaluate control frameworks.

HMRC does not expect perfection. Errors happen. What they do expect is robust controls, documented post clearance checks and evidence that issues are detected and corrected.

If HMRC asks, “Where did this really come from?”, businesses must be able to respond quickly and with credible evidence.

In summary

Frasers may have won the battle, but the wider conflict around anti-dumping duties is only just beginning.

The lesson from both recent cases is clear: businesses must apply the same level of scrutiny to customs duties that they already apply to other areas of financial risk. HMRC’s focus on origin and ADD is increasing, and its activity is accelerating.

Barbourne Brook offers a Customs Landscape Review for businesses that want to examine critical areas such as classification, origin and valuation. This review consolidates data and evidence across departments to provide comprehensive visibility in an area that is often overlooked until it is too late.

See your customs risks before HMRC does.

For businesses seeking assurance in areas such as classification, origin, and valuation, our Customs Landscape Review brings clarity and confidence to your customs position before issues arise.