Red Diesel Use in the EU

UPDATE: 18/10/2018 - Decision from the Court of Justice of the European Union could end the use of red diesel for private pleasure craft in the UK

At the moment almost all diesel sold in British marinas is red diesel, taxed either at a lower rate if some of the fuel is used for heating the boat, or at 100% for the fuel that is used only for propulsion by the engine. In a case launched last year, the EU has argued that the UK should not allow red diesel to be used in this way.

Under EU rules, Member States must apply a "fiscal marker" (red dye in the UK) to diesel which is not taxed at the full rate. The Court of Justice of the European Union has now concluded that Member States may not apply that marker also to diesel which is taxed at the full rate for propulsion, without undermining the purpose of the marker.

Its judgment declares: "that by allowing the use of marked fuel for the purposes of propelling private pleasure craft, even where that fuel is not subject to any exemption from or reduction in excise duty, the United Kingdom has failed to fulfil its obligations... on fiscal marking of gas oils and kerosene". The Court dismissed the evidence from HMRC that ending the use of red diesel would be impracticable, some of which was provided by the Cruising Association.

Judith Grimwade, CA President, said: "We are delighted that the Court has finally delivered a judgment in this case, but given the uncertainties of Brexit, it remains to be seen what the impact will actually be. Whatever the outcome, we will continue to campaign for cruising yachtsmen to be able to travel between countries without being penalised for buying a fuel which is very often the only option available."

No deadline is specified in the judgment and member states are usually given a reasonable period to make the adjustments necessary - which in this case could mean white diesel going on sale in UK marinas - bearing in mind many craft may continue to use red diesel for heating.

However, no-one knows what may happen as a result of Brexit. HMRC is examining this judgment and will announce how and when the UK will adjust its practices in due course.


UPDATE: 26/04/2018 - Development of the use of red diesel with Belgian authorities

RATS has received this notice from the Belgian Finance Office that there will now be no fining or penalties for UK vessels visiting Belgium which have our marine red diesel in their tanks:

The policy of tolerance regarding red diesel in UK flagged yachts visiting Belgium will be maintained until further notice. Any change to this policy will be communicated in due time. This removes any remaining uncertainty for the members, and other yachtsmen and women, who wish to make the crossing from the east coast or channel ports to Belgium. This status quo to the agreement will not change, without warning, on behalf of the boating community in the UK.

This is a constructive development that removes any trace of concern for those Members planning to call into Belgian waters.

However, the 100% fuel duty must still be paid on all red diesel which is purchased prior to the trip to Belgium. The full advice details are contained in the RATS note which can be seen on this document.

Please let RATS rats@theca.org.uk know of your of your experiences this summer. It could be of help to other members.


UPDATE: 14/11/2017 - Another step in the diesel story

During the highly successful negotiations with the Belgian Ambassador and with assistance from HMRC about resolving the problems of Belgium again fining UK vessels with red diesel in their engine tanks, RATS was aware that the ECJ had, after some lengthy delay, issued a Case Number for the European Commission's action against HMG over the use of marked diesel in private leisure vessels. As has been stated before, HMG has always taken it that the marking of our red diesel does not contravene any of the EU regulations. HMRC continue to support the use of red diesel for propulsion in our leisure vessels.

RATS then understood that Counsel was in the process of being instructed on the defence for the UK position, namely that our red diesel is considered to be legal. Members may be interested to know that we have been told by our HMRC contacts that this defence has been lodged with the European Court of Justice.

We await anything further on this hearing and will let Members know of developments as information becomes available.

In the meantime RATS will be pleased to add to our significant record any difficulties Members have when in Belgium. Any thoughts they have on this matter will also be welcome by using the email address rats@thecaorg.uk.

Current advice and any other relevant documents are available to download at the bottom of this page.

 


UPDATE: 24/10/2017 - Updated advice from RATS is in the document, The Use of Marine Red Diesel by Pleasure Craft When In Belgian Waters, attached at the bottom of this page

 


UPDATE: 29/09/2017 - Cruising Association welcomes further assurance from the Belgian Embassy

The Embassy of Belgium in London today confirmed, to the Cruising Association, that ‘the policy of tolerance regarding red diesel in UK flagged yachts visiting Belgium will be maintained until further notice. Any change to this policy will be communicated in due time’.

This removes any remaining uncertainty for our members, and other yachtsmen and women, who wish to make the crossing from the east coast or channel ports to Belgium. This assurance follows cordial and diplomatic exchanges with the Ambassador and his staff including a meeting in August.

As has been widely reported, the levying of fines for Red Diesel was suspended some weeks ago and that suspension remains in force. "We were glad to secure the agreement that this status quo would not change, without warning, on behalf of the boating community in the UK", said Cruising Association President, Judith Grimwade.

Keep an eye on the CA website where we will post updates as and when other information becomes available. www.theca.org.uk

 


UPDATE: 28/07/2017 - CA wins change of heart from Belgian government

The Belgian Ambassador to the UK has told the CA that Belgium will not fine boats found to be carrying red diesel, from now until the issue has been discussed by the EU Committee on Excise Duty on September 18.

The CA had received reports that yachts visiting Belgium were:

  • tested for red diesel in tanks and fined €500 if any traces were found, even if receipts were provided
  • inspected for paperwork, including Schengen crew lists.

As a result, RATS (the Regulations and Technical Services Group) wrote to the Belgian Ambassador in London and Belgian Customs in Brussels to ask for an explanation for their change of conduct. Our contact in Nieuwpoort could give RATS no explanation of the sudden Customs action but now confirm that RATS advice, agreed with them three years ago, will now be honoured.

The CA now recommends that any members planning to visit Belgian ports carry receipts for all diesel purchased in the past two years, which should have tax paid on 100% of the engine fuel. They should also carry a Schengen crew list, and if possible a print-out of the full text of the email from the Belgian Ambassador in the attachment below. Our advice, in the attachment below, will be revised if necessary after September 18.

 


UPDATE: 06/07/2017 - RATS new advice to members - not to call into Belgian ports

RATS has heard of other yachts being fined as well as our CA Members informing us about their friend's plight. These friends have now told RATS in detail of their traumatic experience with the Belgian officials.

We have spoken again with our Belgian marina contact who can offer no reason for, nor why no warning has been given about the non-observance of the agreed 'understanding' of their position over UK yachts with red engine diesel.

The sudden change this year of their conduct and apparent random heavy fining for vessels having even residual traces of red diesel engine fuel, together with no guarantee of the Belgian officials adhering to the original RATS advice note, is unhelpful.

All of this has made RATS review the situation again. They have concluded that they must now raise their level of advice to Members not to call into Belgian ports.

In the meantime RATS will continue to monitor the position and post any further advice.

If Members have comments on, information or details about the Belgian actions, RATS will be pleased to hear from them and thanks them in advance.

Please see the updated document attached below for further information and advice from RATS on the use of red diesel when in EU waters.

 


Original posting 29/06/2017

RATS has just heard that a yacht, which had re-fuelled with white diesel, was in Nieuwpoort on passage back to the UK. It has been fined 500 Euros by Belgian officials for having traces of red diesel in the engine tank.

As the understanding for these last two years with Belgium, as outlined in the 'RATS advice, on red UK diesel' can no longer be relied upon, RATS is now suggesting to Members and other sailors that they may consider not sailing to Belgium.

If any advice is received that the original understanding is upheld of how the Belgian officials treat visiting UK vessels, RATS will publish an update to this note.

See the attached document for further information and advice from RATS.