Zobortrans EU sro v The Home Office

Zobortrans EU s.r.o. (“the Appellant”) is a freight transport company based in Slovakia. The Appellant’s vehicles were stopped and seized by the Border Force as follows:

The Appellant submitted that the review decisions made by the Border Force Officers in relation to the Third and Fourth Seizures were unreasonable, and that the vehicles involved should be restored free of charge. For the reasons set out in this decision notice, we uphold the review decisions and reject the appeals.

The hearing was originally listed to be heard by video, with Mr Jánský and the Appellant’s director, Mr Seidl, joining the hearing from abroad. However, that hearing was postponed at the last minute because Mr Seidl was unwell.

Relisting the hearing on the same basis was precluded by the guidance issued following Agbabiaka (evidence from abroad; Nare guidance) [2021] UKUT 286 (IAC), as Slovakia has not confirmed that it has no objection to evidence being given by video in a Tribunal hearing.

After the position in relation to giving evidence from abroad had been clarified, the parties were provided with a summary of the legal position. In particular, the Tribunal explained that Mr Seidl had to attend the hearing in person in order to give evidence, but that Mr Jánský could attend by video as he was Appellant’s legal representative and not a witness.

On 8 January 2024, Mr Jánský confirmed that both he and Mr Seidl would attend the hearing in person; he added that Mr Seidl required a Slovakian interpreter. Having taken into account both parties’ dates to avoid, the hearing was listed for the two days of 19 and 20 June 2024, with a professional interpreter fluent in Slovakian attending. Those arrangements were communicated to the parties.

At 10.05am on the day before the relisted hearing, Mr Jánský emailed the Tribunal to ask for the case to be postponed on the following basis:

Judge Redston considered the application. As Mr Jánský was the advocate he would not be giving evidence. She confirmed with the Tribunals Service that the case could be converted from face-to-face to hybrid. She then decided it was not in the interests of justice to allow the application, for the following reasons:

Although Judge Redston was surprised that Mr Jánský had only become aware on the day before the hearing that he needed a valid passport to enter the UK, she did not need to clarify this points with Mr Jánský, given the availability of a hybrid hearing and the reasons for rejecting the application set out in the previous paragraph.

At 12.26 the same day, Mr Jánský was informed that Judge Redston had refused the postponement application; that the hearing would be on a hybrid basis, and that he would be sent a link and instructions.

At 13.15, Mr Jánský replied as follows “I fully understand. That was my fault with the passport. Good to hear that I can attend via videoconferrence. I will go through instructions”. However, five minutes later, he emailed again to say:

When the hearing began the following day, Mr Jánský joined by video from Slovakia. The Tribunal reminded him that, as Mr Seidl was not attending the hearing, the only evidence which could be considered was that in the documents before the Tribunal. In particular, Mr Jánský could not give hearsay evidence provided to him by Mr Seidl. When Mr Jánský expressed some concern at this limitation, the Tribunal said that if Mr Seidl was able to come to the UK the following day to give evidence, the structure of the hearing days would be reconfigured to allow that.

Mr Jánský said Mr Seidl was unable to come to the UK the following day because his wife was already booked to work a shift, and Mr Seidl had responsibility for childcare. Mr Jánský applied for the hearing to be adjourned so Mr Seidl could come to the UK on another date.

The Tribunal took time for consideration. We decided that it was not in the interests of justice to allow the application, for the reasons set out at §8(1) to 8(4) above, and for the additional reason that we did not find it credible that Mr Seidl had ever intended to come to the hearing. Had that been the position, he would not be prevented from attending on the second day because of his wife’s prearranged shift pattern and his consequential childcare responsibilities. We informed the parties that the hearing would continue.

It was clear from the assistance already given by the interpreter in relation to Mr Jánský’s submissions that it was in the interests of justice for her (or another interpreter also fluent in Slovakian) to remain for the duration of the hearing, and we directed accordingly.

In restoration appeals, the Tribunal’s jurisdiction is limited. We cannot direct the Border Force to restore a vehicle, or to restore a vehicle without payment, but if we decide the officer in question has made an unreasonable decision, we can direct that the Border Force make a new decision taking into account specific findings of fact.

In C&E Commrs v Corbitt [1980] 2 WLR 753, Lord Lane said that a decision would not be “reasonable”:

In John Dee v C&E Commrs [1995] STC 941, Neill LJ gave the only judgment with which Roch and Hutchison LJJ both agreed. He first outlined the principles in a similar fashion to Lord Lane, but went on to acknowledge at p 953:

In assessing reasonableness, the Tribunal may also consider evidence that was not before the decision maker, and may reach factual conclusions based on that evidence, see Gora v C&E Commrs [2003] EWCA Civ 525.

The documents and submissions made reference to the 1956 Convention relative au contrat de transport international de marchandises par route, in English the “Convention
on the Contract for the International Carriage of Goods by Road”, also known as the CMR Convention from its French title, or simply as “the CMR”.

A standard consignment note was developed based on the CMR Convention; this too is known as a “CMR”. In this decision, when we refer to a CMR we are referring to the consignment note; we refer to the CMR Convention by that name, or as “the Convention”.

Article 8 of the Convention includes the following requirements:

The Tribunal was provided with two Bundles of documents prepared by the Border Force, which included the following:

At 22.25 on the night before the hearing, Mr Jánský filed and served documentary evidence relating to the following:

Those documents were filed and served long after the deadline set in the Tribunal’s directions. However, Mr Davies did not object them being admitted into evidence, and the Tribunal gave permission. However, we went on to agree with Mr Davies that the penalty decision was not relevant to these proceedings, and we say no more about it.

Mr Davies applied during the hearing to admit a screenprint of a page from the Companies House website. Mr Jánský did not object to that application, and we admitted the document into evidence.

The review decision in relation to the Third Seizure was made by Officer Brenton on the basis of the evidence before him. He provided a witness statement, but had retired by the date of the hearing. Officer Ian Cox reviewed the information considered by Officer Brenton together with other information, and came to the same conclusion. He provided a witness statement to that effect.

As Judge Redston observed in Paniec v DBR [2020] UKFTT 0360 (TC), the issue in restoration appeals is whether the review decision was reasonable, and it is the Tribunal which has to decide that issue. The view of a different Border Force Officer as to reasonableness is not evidence in the appeal. However, an Officer who did not make the review decision can give witness evidence about the Border Force’s practice and procedures generally, and can also give evidence about relevant information identified after the review decision was made. Officer Cox was cross-examined by Mr Jánský and re-examined by Mr Davies. We found him to be wholly honest and credible.

The review decision in relation to the Fourth Seizure was made by Officer Mark Summers. He provided a witness statement, gave evidence-in-chief led by Mr Davies, was cross-examined by Mr Jánský, re-examined by Mr Davies and answered questions from the Tribunal. He too was a wholly honest and credible witness.

Based on the evidence summarised above, we make the findings of fact in this decision. We first make findings about the Appellant and the First to Fourth Seizures, and then about other matters.

The Appellant is a freight transport company based in Slovakia, of which Mr Seidl is the owner and director. At the relevant time, it carried out around 20,000 transport journeys a year, the majority of which were to the UK.

On 7 October 2018, one of the Appellant’s vehicles was stopped by the Border Force and 48 kilos of HRT were found in the load. The HRT was seized, together with the vehicle. The Border Force offered to restore the vehicle for a payment of £10,616.64. The Appellant paid that sum to the Border Force and the vehicle was restored.

Mr Seidl’s evidence, given on 11 June 2019, was that the driver of the vehicle was subsequently retained as an employee until he had repaid the £10,616.64, at which point his contract was terminated. There was no challenge to the first part of that evidence: the Border Force accepted the driver had been retained by the Appellant despite having been found to have smuggled 48 kilos of HRT, and we find that to be a fact.

The second part of the evidence was challenged. In deciding whether to accept it, we took into account that:

Given the above, we do not find it credible that, within the eight month period which followed the First Seizure, the driver had paid the Appellant £10,616.64: this would be roughly twice the salary he had earned during that period. Consistently with that finding, we also reject Mr Seidl’s evidence that the driver’s employment contract was terminated after he had paid that sum to the Appellant.

On 28 November 2018, one of the Appellant’s vehicles was stopped by the Border Force and 24 kilos of HRT were found in the load. The HRT was seized, together with the vehicle. The Border Force offered to restore the vehicle for a payment of £5,631.60. The Appellant paid that sum and the vehicle was restored.

Mr Seidl’s evidence, also given on 11 June 2019, was that the Appellant was currently deducting sums from the driver’s salary and he would be terminated once the amount had been repaid in full.

There was no dispute that the driver’s employment was not terminated despite him having been found to have smuggled 24 kilos of HRT, and we find that to be a fact. The second part of the evidence was challenged. In deciding whether to accept it, we took into account that:

Taking into account all the above, we reject Mr Seidl’s evidence that the driver was required to pay the Appellant £5,631.60, after which he would be sacked.

On 5 December 2018, a tractor and trailer unit owned or leased by the Appellant arrived at Dover. It was driven by Mr Moroslav Balint, an employee of the Appellant. According to the accompanying transport documentation, the trailer was carrying car parts, seat belts and compressors.

Mr Balint’s evidence, given to the Border Force Officers and recorded at the time, was that the trailer was not sealed. Mr Seidl said in subsequent (undated) correspondence that “we undertake to use in our company the locking seals on the load and trailers” and “the company also adopted measure the trailer to be sealed before departure”. However:

We prefer the contemporaneous evidence given by Mr Balint and find as a fact that the trailer involved in the Third Seizure was not sealed.

When the vehicle was searched, 96kg of HRT was found, some in the trailer and some in the cab. The duty and VAT which should have been paid on the HRT totalled £22,464. The Border Force seized the HRT and the tractor and trailer unit.

Mr Balint was issued with a Seizure Information Notice (form BOR156); a Seizure of Vehicle Notice (form BOR 162) and a Notice 12A, which informed the Appellant of the right to challenge the seizure in the Magistrate’s Court. Mr Balint was not arrested and the Appellant did not challenge the seizure.

The evidence about what had happened before Mr Balint arrived at Dover included the following:

Having assessed that evidence, we find the following facts:

Mr Seidl’s evidence was that the Appellant had subsequently terminated Mr Balint’s contract and was suing him in the Slovak courts. However, there was no supporting evidence (such as a termination letter and/or court documents), and Mr Seidl did not attend the hearing and so could not be cross-examined. We take into account that the Appellant did not dismiss either of the drivers involved in the First and Second Seizures, and also did not dismiss Mr Loci, who was involved in subsequent seizures (see further §61ff). On the balance of probabilities, we find as a fact that Mr Balint also was not dismissed as a result of the Third Seizure.

The Border Force offered to restore the tractor and trailer for £22,464, equal to 100% of the duty/VAT involved. Mr Seidl said that paying that sum “will cause to Zobortrans huge existence problems”. Again, there was no supporting evidence, such as financial statements, to support this statement, and Mr Seidl could not be cross-examined. As this importation was one of over 200,000 journeys made by the Appellant’s vehicles in a calendar year, we find that the Appellant is not running a small business, and also find on the balance of probabilities that (given its size) the Appellant would be able to pay the fee without its existence being threatened.

On 3 April 2019, the Appellant received an order which stated that a shipment was being subcontracted to it from a company called Stozek, which in turn was said to be a subcontractor of another company called Rhenus. Both are well known businesses in Slovakia.

The delivery documents included a handwritten and largely illegible CMR. This did not contain any statement that the driver had been unable to check the goods and the reasons for this.

The documents also included a Delivery Note, which included the following information:

Companies House website gives GTEL’s registered address as 160 City Road (rather than 180 City Road), and records that it was incorporated on 27 February 2019, some four weeks before the order in question. It also states that GTEL’s business was “non-specialised wholesale of food, beverages and tobacco” and “wholesale of other food, including fish, crustaceans and molluscs”.

Mr Seidl’s evidence on the following points was unchallenged:

In reliance on that evidence we find that when the Appellant received an order, it did not check the bona fides of the consignor and/or consignee, and (at least in relation to the Third Seizure) also did not check from the CMR to the goods on the vehicle.

On 8 April 2019, a Renault Van owned by the Appellant arrived in Dover accompanied by the documentation summarised above. The driver was Mr Paul Capucha, another of the Appellant’s employees. He told Border Force officers that:

In reliance on that evidence, we find the above to be facts.

When the vehicle was searched, it was found to contain 140,000 cigarettes cached within the legitimate load, with a duty value of £36,453. The vehicle was seized, the cigarettes confiscated, and Mr Capucha arrested. He was also issued with form BOR156 and BOR 162, together with Notice 12A. The Appellant did not challenge the seizure in the Magistrate’s Court.

In an email to the Border Force dated 6 August 2019, Mr Seidl said “the company closed the employment with the driver”. However, there was no supporting evidence (such as a termination letter), and Mr Seidl did not attend the hearing and so could not be cross-examined. The Appellant did not dismiss any of the drivers involved in the previous three Seizures, and did not dismiss Mr Loci, who was involved in subsequent seizures (see further §61ff). On the balance of probabilities, we find as a fact that Mr Capucha was not dismissed as a result of the Fourth Seizure.

The employment contracts between (a) the Appellant on the one hand, and (b) Mr Balint and Mr Capucha on the other, included the following terms:

The contracts thus contained no reference to smuggling. Mr Seidl’s unchallenged evidence was that there was no requirement under Slovak law for employment contracts to contain such a provision.

On 17 July 2022, the Border Force stopped a vehicle belonging to the Appellant and driven by a Mr Jan Loci, an employee of the Appellant. The vehicle was found to contain 8,440 cigarettes, which were seized, as was the vehicle. The Border Force offered restoration for a fee of £3,523. The Appellant accepted, and the vehicle was restored.

On 29 May 2023, the Border Force stopped a tractor unit and trailer belonging to the Appellant, also driven by Mr Loci. It was found to contain 503,000 cigarettes with a duty/VAT value of £209,968. These were seized, as was the vehicle. The Border Force offered restoration for a fee of £4,000. The Border Force Officer in question said that “normally in these circumstances the vehicle would not be offered for restoration” but that he had taken into account the steps the Appellant had taken to prevent smuggling, noting that its “recent track record suggests that the measures have made a difference”. The Appellant accepted the offer, and the vehicle was restored.

The Border Force policy on restoration (“the Policy”) provides that the Border Force’s approach differs depending on whether:

Under Part A, the Policy says:

Under Part B, the Policy reads:

Under Part C, the Policy reads:

In Szymanski v DBR [2019] UKUT 0343 (TCC) (“Szymanski”) at [43] and [49], the Upper Tribunal found that the Policy was reasonable. In addition, as both Officer Brenton and Officer Summers said in their review letters, the Policy had been applied “firmly but not rigidly” so as to allow an exercise of discretion on a case-by-case basis.

We first summarise Officer Brenton’s review decision, followed by a discussion of the relevant factors.

On 5 March 2019, Officer Brenton decided that paragraph B(2)(a) of the policy applied, and offered to restore the vehicle for a sum equal to 100% of the revenue involved in the smuggling attempt. His review decision said that:

In coming to that decision, Officer Brenton did not take into account further evidence provided by Mr Seidl on 11 March 2019: this was before the deadline given to the Appellant but for some unknown reason this was not forwarded to Officer Brenton before he made the decision. Officer Brenton was also plainly unable to take into account evidence provided subsequently as part of the Appellant’s grounds of appeal, and he did not take into account (and was presumably unaware of) the First and Second Seizures. It was thus common ground that the Tribunal needed to consider additional facts in deciding whether the outcome of the review decision was reasonable.

The parties submitted that one or more of the following factors were relevant.

We have found as a fact that he trailer was not sealed. Mr Davies submitted that sealing the trailer was a basic reasonable step to prevent smuggling, as an unsealed trailer made it much easier for a smuggler to hide goods within a legitimate load. We agree.

It was common ground that Mr Balint was involved in the smuggling which led to the Third Seizure. Mr Davies submitted the Appellant’s failure to dismiss him was the opposite of a “reasonable step”, because he could continue to smuggle on future journeys. Again, we agree.

Mr Davies also submitted that the Appellant had failed to include, in the employment contract, a specific provision stating that any employee found to be involved in smuggling would be summarily dismissed. Mr Jánský relied on the clauses set out earlier in this decision, see §59, and said that they could be read as having the same effect. He emphasised in particular that failing to protect the Appellant’s property was a “serious” breach which “shall be a reason for immediate termination of the employment relationship with the Employer”.

We agree with Mr Davies that not only are those clauses general in nature, with no reference to smuggling, but also that smuggling did not result in the “immediate termination” of an employment: it was common ground that neither of the drivers involved in the first two Seizures was summarily dismissed, and neither was Mr Loci. We have also found as facts that neither Mr Balint nor Mr Capucha was dismissed.

Mr Jánský also relied on Slovak law, saying that there was no requirement to include in employment contracts, a clause stating that an employee found to be involved in smuggling would be summarily dismissed. We have accepted that this is not a legal requirement in Slovakia, but nevertheless agree with Mr Davies that the inclusion of such a clause would have been a reasonable step.

The Policy takes into account earlier seizures. At the time of the Third Seizure, the Appellant’s drivers and vehicles had been involved in two previous smuggling attempts within the previous two months. Mr Jánský submitted that little weight should be given to this factor, as the Appellant carried out around 20,000 transport journeys a year, the majority of which were to the UK, so that these earlier seizures represented a tiny fraction of the total journeys.

It is true that the Policy takes into account the number of intercepted smuggling attempts irrespective of the size of the business in question, and therefore does not set less demanding criteria for larger businesses which make multiple journeys. However, such companies should be more aware of their obligation to prevent smuggling than smaller operators who rarely visit the UK. Moreover, such shading of the Policy would be difficult to evaluate and enforce. We are in no doubt that the First and Second Seizures were relevant factors to be taken into account when deciding on restoration.

Mr Jánský submitted that it could be seen from the subsequent seizures that the fee for restoration of the tractor and trailer unit involved in the Third Seizure was too high: following the seizure on 29 May 2023 of 503,000 cigarettes with a duty/VAT value of £209,968, the tractor and trailer unit were restored for only £4,000.

We do not agree that this is a relevant factor. The reasonableness of the decision to restore the tractor and trailer involved in the Third Seizure must be considered in the light of the facts relevant to that Seizure, not on the basis of a subsequent decision which included consideration of the Appellant’s changed approach.

Both parties made submissions on hardship. As set out at §48, we have already found that the Appellant can afford to pay the restoration fee, and we further find that Officer Brenton’s conclusion in relation to this factor was correct.

Mr Jánský submitted that the implementation of GPS tracking in the Appellant’s vehicles was a reasonable step which would help to deter smuggling. This was not in dispute and we agree.

Although some of the further factors discussed above were not relevant to the decision about the Third Seizure, others do need to be considered in addition to those taken into account by Officer Brenton.

Mr Jánský’s position was that, after taking into account those additional factors, Part B(1) of the Policy should be applied, because the driver but not the Appellant was complicit in the smuggling, and the Appellant had taken “reasonable steps” to prevent smuggling. In his submission, the Tribunal should direct the Border Force to make a new decision which would be likely to result in the vehicle being restored free of charge.

Mr Davies submitted that in the light of the further factors, the relevant part of the Policy was not B(1) – to restore the vehicle for 100% of the revenue involved – but instead B(2), which states that “on a second or subsequent occasion the vehicle will not normally be restored”. However, Mr Davies said the Border Force were not inviting the Tribunal to direct the Border Force to come to a harsher decision, but was instead asking us to confirm that Officer Brenton’s decision was reasonable.

We agree with Mr Davies that the Appellant did not take reasonable steps so as to bring itself within Part B(1) of the Policy because:

The use of GPS was a reasonable step, but this was insufficient on its own to meet the requirement. Instead, the correct part of the Policy is B(2)(b), because there had been two previous seizures within the last two months.

Thus, although Officer Brenton’s decision did not take into account all relevant factors, if we directed the Border Force to remake the decision taking into account those factors, the new decision would be likely to remove the offer of restoration for a fee. However, as the Border Force invited the Tribunal instead to leave the position unchanged, we have therefore decided to confirm Officer Brenton’s decision.

We first summarise Officer Summers’s review decision, and then discuss the relevant factors.

Officer Summers decided that the Fourth Seizure satisfied the conditions at Part C(2) of the Policy because:

Application of Part C(2) would have led to the conclusion that the vehicle should not be restored. However, taking into account that the revenue involved was less than £50,000, Officer Summers decided to use his discretion and instead apply Part C(1). He offered restoration for £17,623, being the trade value of the seized vehicle.

In coming to that decision, Officer Summers took into account the following factors in addition to the value of the duty/VAT:

Officer Summers also considered the degree of hardship, noting that all vehicle seizures cause inconvenience and cost to the owner, but decided there was no evidence of “exceptional hardship” in the Appellant’s case.

By the conclusion of the hearing, the Border Force had accepted that Officer Summers had taken into account some incorrect and/or irrelevant factors, and we agree. We find that:

Mr Davies submitted that, even taking those points into account, any new decision would either “inevitably be the same” or harsher than the conclusion reached by Officer Summers. This was because the correct Part of the Policy was B(2)(b): the driver but not the operator was responsible, but the Appellant did not take reasonable steps to prevent smuggling, and there had been three previous seizures in the last twelve months. Part B(2)(b) required that the vehicle would “not normally be restored”.

In relation to the lack of reasonable steps, Mr Davies relied on the following points:

Mr Jánský submitted that Part B(1) of the Policy should have applied, because the Appellant did take reasonable steps. He repeated his submissions about the GPS and the employment contract, and added that there was no requirement under the Convention for an operator to check that the consignor and consignee are bona fide businesses. He said that the steps taken by the Appellant were entirely reasonable when considered from the perspective of a business operating in Slovakia, and that the Border Force should take that into account.

He also submitted that the Border Force had also not acted reasonably, because they should have investigated the smuggling rather than simply confiscating the vehicles. By way of example, he said they could have contacted Mr Cooke, who was named on Delivery Note, and/or followed the vehicles to their destination.

In relation to the last of those points, we disagree. It was Officer Summers’ responsibility to decide whether or not to restore the seized vehicle, and the Tribunal’s jurisdiction is to decide whether he made a reasonable decision. Whether the Border Force as a body could have done more to locate and intercept the smugglers is not a relevant consideration.

We also disagree with Mr Jánský’s submission that the Border Force should be required, when assessing reasonable steps, to consider what is meant by “reasonable” in other countries. Such an approach would be unfair, as countries with poor compliance would be held to a lower standard than those with stricter rules. It would also be impracticable: the UK imports goods from almost all corners of the globe, so establishing the position in the country of origin and/or the location where the carrier was based would be a huge exercise. Finally, it would undermine one of the purposes for which the Border Force had been established, namely to prevent smuggling. One of the ways the Border Force carry out that key task is to require carriers and importers to adopt “reasonable steps” to minimise the risk of smuggling. It is true that those steps go beyond the requirements placed on carriers by the Convention, but as the UT said in Szymanski at [54]:

We have already found in relation to the Third Seizure that installing GPS was a reasonable step, but that this was insufficient on its own to meet the requirements of the Policy, given the absence of any specific provision in the employment contract and the Appellant’s practice of continuing to employ drivers who had been caught smuggling. The Appellant has failed to show that the conclusion should be any different in relation to the Fourth Seizure. We would thus have confirmed Officer Summer’s decision on those grounds alone.

That conclusion is further supported by the Appellant’s failure to check any of the following:

We therefore find that the Appellant did not take reasonable steps, and so did not fall within Part B(1) of the Policy; instead it came within Part B(2). Officer Summers then used his discretion to offer restoration in accordance with subparagraph (a) of that Part. There was nothing unreasonable in the exercise of that discretion.

We therefore agree with Mr Davies that any new Border Force decision which took in the new findings of fact would either have the same outcome, or would be harsher than the conclusion reached by Officer Summers. As with the Third Seizure, the Border Force did not ask the Tribunal to remit the decision back so that it could take the additional factors into account and consider removing the restoration option. We therefore uphold Officer Summers’ decision.

For the reasons set out above, the Border Force review decisions in relation to the Third Seizure and the Fourth Seizure are confirmed. The Appellant’s appeals are dismissed.

This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to "Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)" which accompanies and forms part of this decision notice.