End-user statement: why your supplier asks so much when you buy spare parts

A buyer at a plant outside the EU orders a pressure sensor, a frequency converter and a few valves from a European supplier. Shortly afterwards, a query comes back: please complete an end-user statement. Who is the end user? What will the goods be used for? And do you have an EORI number?

Many buyers see such questions as red tape or even as mistrust. In fact, they are usually a legal obligation of the seller. This article explains the key terms from the buyer’s point of view, so that you understand why the questions are asked and your orders go through faster.

Note: This article is a general introduction and does not constitute legal advice. For binding information, contact your export control department, your customs department or the competent authorities.

Export control: why suppliers have to check at all

Anyone exporting goods from the European Union is responsible for complying with export control law. This does not only apply to weapons or obviously military goods. Many civilian industrial products can also be affected if they are technically suitable for military purposes or are going to certain recipients. The exporter must therefore check:

• Are the goods listed and subject to licensing?
• Is there an embargo or are there sanctions against the country of destination?
• Is the recipient or end user on a sanctions list?
• Are there indications of a critical end use?

This check is not a matter of courtesy. Violations can have serious legal consequences for the exporter.

When your supplier asks about end use, they are not checking up on you. They are protecting themselves and you from a problem that would hit you both.

Dual use: civilian goods with two faces

Dual-use goods are goods, software and technologies that can be used for both civilian and military purposes. In the EU, this is governed by the Dual-Use Regulation, currently Regulation (EU) 2021/821. The listed items are set out in its Annex I.

This is more relevant for industrial spare parts than many people think. Depending on their technical specification, certain machine tool controllers, precision measuring equipment, special pumps, valves made of special materials or certain frequency converters, for example, may be covered. Whether a specific part is affected depends on its technical parameters, not on the product name.

If an item is listed, its export from the EU requires a licence. In Germany, the competent authority is the Federal Office for Economic Affairs and Export Control, BAFA for short. A licence requirement can also arise for non-listed goods if the exporter has been informed by BAFA, or is itself aware, that the goods are intended for a critical use, for example in connection with weapons of mass destruction or for a military end use in a country under an arms embargo. This is known as the catch-all rule under Article 4 of the Regulation.

The end-user statement

An end-user statement, also known as an end-use declaration, is a document in which the recipient confirms who will ultimately use the goods, for what purpose and in which country. The supplier requests it to fulfil its due diligence obligations, and for exports subject to licensing it is often part of the application.

What is typically requested

• Name and address of the end user
• Intended use of the goods, as specific as possible
• Country of destination and place of use
• Assurance that the goods will not be used for military or prohibited purposes
• Assurance regarding onward transfer or re-export
• Signature of an authorised signatory

What you can prepare

Have a short, factual description of your company and of the plants in which the spare parts are used ready. “Spare part for the filling line in our beverage plant” is a good statement. The clearer the use, the faster the check. Clarify internally who is authorised to sign end-user statements, so that requests do not wait days for a signature.

Origin of goods: preferential and non-preferential

The origin of a product is the country in which it was wholly obtained or underwent its last substantial processing. That is not necessarily the country it is shipped from. A part that comes from Hamburg can have its origin in Japan, the USA or Italy.

Non-preferential origin

This is relevant for trade policy, import restrictions or marking requirements. Many countries require a certificate of origin on import. In Germany, certificates of origin are usually issued by the Chambers of Industry and Commerce (IHK). In some countries the certificate must also be certified or legalised.

Preferential origin

This is relevant when a trade agreement exists between the EU and the country of destination. Goods of preferential origin can then be imported at a reduced customs duty rate or duty-free. Depending on the agreement, this is proven, for example, by an origin declaration on the invoice or a movement certificate. The prerequisite is that the goods meet the rules of origin of the agreement. For merchandise the supplier buys in itself, it needs supplier’s declarations from its own suppliers.

For buyers this means: if you want to take advantage of customs benefits, say so in your enquiry. Not every part meets the rules of origin, and the supplier first has to obtain the evidence.

EORI: the customs number for companies

EORI stands for Economic Operators Registration and Identification. The EORI number is an identification number that companies in the EU need to communicate with the customs authorities, for example for imports and exports. In Germany, it is applied for from the German customs administration.

For buyers outside the EU, the EORI number is usually not an issue, because they do not file EU customs declarations. For companies in the EU that buy goods from or deliver goods to non-EU countries, on the other hand, it is indispensable. If a supplier asks for your EORI number, they need it for the customs declaration.

Other questions you might hear

Supplier’s question	Why it is asked
Who is the end user?	Export control and sanctions screening
What will the part be used for?	Check for critical end use
Do you need proof of origin?	Import regulations or tariff preference in the destination country
What is your EORI or tax number?	Customs declaration and invoicing
Which customs tariff number (HS code) do you use?	Aligning the classification for import
Will the goods be resold?	Re-export and end use

Typical scenario: the blocked order

A plant in Asia orders a large number of components from a European supplier. One item is a frequency converter that the supplier’s screening flags as possibly subject to licensing. The supplier requests an end-user statement. The plant reacts with annoyance and only sends the statement after a week. The supplier then has to initiate an official review, which takes further time. The rest of the order waits.

Had the plant completed the statement immediately and released the other items separately, most of the parts would long since have been on their way. The lesson: answer export control questions quickly and completely, and separate critical items from non-critical ones.

What you can do as a buyer

1. Keep a standard description of your company and your plants ready.
2. Decide who signs end-user statements.
3. State the country of destination and the end user in your enquiry.
4. Say early on whether you need proof of origin.
5. Answer queries promptly and completely.
6. If in doubt, separate critical items from non-critical ones so the whole order does not have to wait.

How KTB handles this

Since 1976, KTB Europe has been sourcing spare parts for industrial customers in many countries. As an exporter, we too are bound by the rules described. That is why, where necessary, we ask about the end user and intended use, handle the export declaration for the goods we deliver and provide the required accompanying documents, insofar as they are available for the part in question. Our contacts speak many languages and explain why a piece of information is needed. This keeps the effort on your side to a minimum.

Find out more about our approach on the procurementpage. Do you have a question about a specific order? Write to us via the contact page.

Conclusion

Questions about end use, origin and EORI are not harassment, but part of a legal framework that applies to everyone. If you know the terms, prepare the necessary information and answer queries quickly, you will receive your spare parts faster and without nasty surprises at the border.