Smuggling penalty proceedings opened against you: fine, confiscation and defence

The case, in five lines

What is brought

Submissions against the decision to initiate, with evidence and an alternative valuation, seeking to have the proceedings closed, the infringement downgraded or confiscation excluded. Against the decision, an appeal for reconsideration (recurso de reposición) or an economic-administrative claim (reclamación económico-administrativa), as its statement of appeal rights (pie de recurso) indicates, and then judicial review (recurso contencioso-administrativo). If the matter moves to the criminal courts, Managora does not handle that defence.

Before which court

The proceedings are investigated by the smuggling section of the customs office (Administración de Aduanas) for the province where the infringement was discovered, and decided by the head of that office (Administrador de Aduanas), the Head of the Customs and Excise Unit (Jefe de Dependencia de Aduanas e Impuestos Especiales) or the Director of the Customs and Excise Department (art. 16 of Royal Decree 1649/1998). The claim is decided by the TEAR (Tribunal Económico-Administrativo Regional, the regional tax appeals tribunal), or by the TEAC (Tribunal Económico-Administrativo Central, the central tax appeals tribunal) if the Director imposed the penalty or, on further appeal (alzada), if the amount exceeds 150,000 euros. Judicial review goes to the Sala de lo Contencioso-administrativo (administrative chamber) of the Tribunal Superior de Justicia (regional High Court of Justice) or to that of the Audiencia Nacional (National High Court) (arts. 10.1.d and 11.1.d of the LJCA, the Administrative Courts Act).

Deadline

Fifteen days to respond from the day after notification of the decision to initiate (art. 31 of Royal Decree 1649/1998). Six months for a decision, extendable once; once they expire, and after a further thirty days, the proceedings lapse (art. 35.5). One month for the appeal for reconsideration or the claim (arts. 223.1 and 235.1 of the Ley General Tributaria, LGT, the General Tax Act) and two months for judicial review (art. 46.1 LJCA). The infringement becomes time-barred four years after it was committed (art. 15 of Organic Law 12/1995).

Who can bring it

The individual or company accused of the infringement (art. 11.1 of Organic Law 12/1995), personally or through an accredited representative: the firm files the submissions, appeals and claim under your authorisation, without asking for your digital certificate. The owner of the goods or of the vehicle who took no part in the facts can make submissions to save them from confiscation (art. 5 of Organic Law 12/1995).

Financial risk

A fine of 100% to 350% of the value, with a minimum of 500 euros (200% to 350% and 1,000 euros for the goods in art. 2.2; up to 600% and 2,000 euros for tobacco), plus confiscation and, for those goods, closure or suspension of the activity. Appealing carries no fee and suspends the fine without a guarantee, but judicial review may end with an order to pay costs. If customs sees a criminal offence, it passes the matter to the criminal courts.

Crime or infringement: the value decides who judges you

The same conduct is either a criminal offence or an administrative infringement depending on what the goods are worth. Failing to present goods for customs clearance or hiding them within the customs area, trading in non-Union goods without proving that they were lawfully imported, diverting goods in transit to consumption, importing or exporting without complying with a trade policy measure, or obtaining release of the goods on false grounds is a criminal offence from 150,000 euros (art. 2.1 of Organic Law 12/1995). The threshold drops to 50,000 euros for historical heritage, monopoly or prohibited goods, CITES species, defence material, dual-use items, goods that could be used for torture and drug precursors (art. 2.2), and to 15,000 for tobacco. For drugs, weapons, explosives or toxic chemical or biological agents, or where an organisation is involved, there is no threshold.

Below those amounts it is an administrative smuggling infringement, however small the value, whether committed with intent or with any degree of negligence (art. 11.1). If customs considers that the facts may amount to a criminal offence, it refers the matter to the criminal courts (pase del tanto de culpa), notifies you and stops acting until there is a final judgment, a discontinuance or dismissal, or the file is returned; if the judge finds no offence, customs continues on the basis of the facts the judge holds proven, and a criminal conviction rules out the fine (art. 17 of Royal Decree 1649/1998). Meanwhile, customs may assess and collect the customs debt (fourth additional provision of Organic Law 12/1995).

What nobody tells you is that the threshold is not measured shipment by shipment: where there is a preconceived plan or the same opportunity is exploited, the law adds the values together, and the offence can also be committed through gross negligence (art. 2 of Organic Law 12/1995). A company can be criminally liable, with a fine of two to four times the value and a ban, for one to three years, on obtaining subsidies, contracting with public authorities and enjoying tax benefits (art. 3.3). Managora does not handle the criminal defence; it does handle what remains administrative, such as the assessment of the taxes.

What you are accused of: not every customs error is smuggling

Read the decision opening the proceedings (acuerdo de inicio) to find which conduct under art. 2 you are accused of: each one is defended differently. If it is failing to present the goods or holding them without proving their import, the defence is documentary: the chain of invoices back to the declaration under which they were cleared. In a transit operation that was not discharged, the law presumes that the goods were released for consumption if they do not reach the office of destination intact or the seals and other control measures were not respected, unless proven otherwise (art. 11.1 of Organic Law 12/1995). And if the goods turned up in false bottoms or concealed spaces, the regulation presumes deliberate concealment, again unless proven otherwise (art. 2.1.a of Royal Decree 1649/1998).

The most disputed boundary is the inaccurate declaration. If the goods were presented and declared, and what is wrong is the classification or the value of goods in lawful trade not subject to a licence or a trade policy measure, the matter is in principle one for an assessment and, at most, a tax penalty: an inaccurate declaration causing no economic loss, for example, is penalised at one per thousand of the value, between 100 and 6,000 euros (art. 199.7 LGT). It is smuggling when the error serves to evade a licence, a prohibition or a measure, or to obtain release on false grounds, and an incorrect classification that gets round the electronic controls aggravates the fine (art. 12 bis.1.c of Organic Law 12/1995).

Failing to respond is penalised too. Not providing the documents for the goods, not complying with a duly notified request or failing to appear without good reason is a minor infringement of obstruction, with a fine of 1,000 euros (3,000 if officials are prevented from entering and 5,000 if there is coercion), unless it is used to aggravate the main penalty (arts. 11.4 and 12.4 of Organic Law 12/1995). Always respond, even if only to explain which document you do not have and whom you have asked for it in writing: that letter is also evidence of your diligence.

The value customs sets decides the grade and the fine

The grade depends solely on value (art. 11.2 of Organic Law 12/1995). As a general rule, the infringement is minor below 37,500 euros, serious from 37,500 to 112,500 and very serious above that. For the goods in art. 2.2, such as dual-use items, defence material or CITES species, the cut-off points are 6,000 and 18,000 euros, and for tobacco 1,000 and 6,000. That is why a difference of a few thousand euros in the valuation changes the band and, at the edge of 150,000, 50,000 or 15,000 euros, decides whether your case is resolved by customs or by a criminal judge.

The fine is a percentage of the value (art. 12): 100% to 150% if minor, 150% to 250% if serious and 250% to 350% if very serious, with a minimum of 500 euros. For the goods in art. 2.2 it ranges from 200% to 225%, 225% to 275% and 275% to 350%, with a minimum of 1,000 euros, and for tobacco it reaches 600%, with a minimum of 2,000; for those goods the premises may also be closed or the activity involving those goods suspended. In the warehouse case, bringing the valuation down from 48,000 to 37,000 euros turns the serious infringement into a minor one, and the minimum fine falls from 72,000 to 37,000 euros.

Customs values the goods before opening the proceedings (art. 25.1 of Royal Decree 1649/1998), and not on the basis of your invoice: for imported or exported goods, the Organic Law takes the average price declared to customs for similar goods in the same tariff subheading in the calendar month before the facts and, in other cases, the official price, the average Spanish market price or the sale price. Ask for the valuation record and check the subheading, whether the goods treated as similar really are, and the reference date, which is that of the facts or, if unknown, of their discovery. A well-documented alternative valuation is, together with the fault argument, your strongest card in the proceedings.

Fault and grading: where the fine is won or lost

There is no penalty without fault: only those who act with intent or fault are liable (art. 28.1 of Law 40/2015), and Organic Law 12/1995 is satisfied with any degree of negligence (art. 11.1). The bar is low, but it exists. If your supplier loaded different goods or more units than ordered without your being able to know, if you bought from an established wholesaler with an invoice and at market price, or if whoever lodged the declaration departed from your instructions, you can argue that you acted with due diligence or made an unavoidable error (error invencible), and then there is no fault. An error that ordinary diligence would have avoided does not save you: it is negligence, and that is enough for a penalty.

The fine is graded from the minimum of the band (art. 6.3 of Royal Decree 1649/1998). It is increased by repeat offending, if in the previous five years you have a final smuggling penalty or conviction (15 to 20 points for minor and very serious infringements, 30 to 40 for serious ones, and more if there are several), obstruction of the investigation, fraudulent means or a front person, commission through or for the benefit of someone with special facilities to do so, and use of simplified customs clearance procedures (art. 12 bis of Organic Law 12/1995 and arts. 8 and 9 of the Royal Decree). The decision must state the criteria used for grading (art. 35.2.e of the Royal Decree): an aggravating factor without reasons is a ground of appeal.

What nobody tells you is that the mitigating factor for goods in lawful trade (15 to 20 points off, 30 to 40 for serious infringements), which does not apply to prohibited goods, dual-use items, defence material, CITES species, historical heritage, tobacco or goods subject to a trade policy measure (art. 12 bis.2 of Organic Law 12/1995 and art. 7 of Royal Decree 1649/1998), never takes the fine below the minimum of the band: the TEAC has settled this in a ruling unifying its criteria, so it only offsets aggravating factors. Nor is there any reduction for accepting the proposal or paying promptly: a recent TEAC criterion, not yet repeated, refuses to apply those in the General Tax Act and Law 39/2015. Admitting liability or paying before the decision only closes the proceedings sooner, without losing the right to appeal (art. 18 of the Royal Decree).

Confiscation: what you lose, what can be saved and what happens meanwhile

Confiscation goes with the penalty and covers the goods, the materials and instruments used, the means of transport and the profits (arts. 5 and 14.1 of Organic Law 12/1995); even before the proceedings are opened, officials seize as a precaution anything that may be confiscated (art. 14.2). It has two limits worth arguing from the outset. Goods in lawful trade that belong to a third party in good faith, or that a third party acquired in good faith, are not confiscated (art. 5.3), nor is the vehicle of a third party who took no part if confiscating it would be disproportionate to its value and that of the goods (art. 5.1.c).

While the dispute lasts, the goods remain seized: they are not returned until a final decision so declares or the deciding body so agrees (art. 28 of Royal Decree 1649/1998). That is why you can ask for early return, especially if lawful import has already been proved, or to be appointed custodian (depositario), with a guarantee if the investigating officer requires one, so that the goods do not deteriorate in someone else's warehouse. If keeping them involves a risk or a significant loss of value, even through the passage of time, or if you expressly abandon them, they may be sold early and the proceeds held on deposit (art. 14.1 of Organic Law 12/1995, which refers to its art. 7).

If confiscation is ultimately not ordered, the goods are returned to their owner or, if they were sold earlier, the proceeds are handed to whoever proves ownership (art. 36 of the Royal Decree). If they are confiscated, the customs debt on those duties is extinguished (art. 124.1.e of the Union Customs Code); if goods that were never cleared are released, they will have to be declared and the customs duties and import VAT paid, because the fine does not replace the taxes. The customs declaration is lodged by your company or by a registered customs representative; we prepare the classification, the valuation and the documents, and we challenge the assessment if it is wrong.

Deadlines and appeals: fifteen days, six months, one month and two months

The proceedings open with a decision to initiate (acuerdo de inicio), and from the day after it is notified you have fifteen days to make submissions, provide documents and propose evidence (art. 31 of Royal Decree 1649/1998). If the decision already sets out the facts, their legal classification and the penalty, and you remain silent, it may be treated as the proposed decision and go straight to a ruling (art. 25.2). If you respond, an evidence period of ten to thirty days may be opened, and there is a fifteen-day hearing before the proposal, which goes to the deciding body without coming back to you (art. 34.2); if that body wants to aggravate the classification, it must first give you fifteen days (art. 90.2 of Law 39/2015).

Customs has six months from the decision to initiate to rule, extendable once only by another six, not counting delays you cause or time spent in the criminal courts. Thirty days after the deadline passes without a decision, the proceedings lapse and are archived, although new proceedings may be opened if the infringement is not time-barred (art. 35.5 of the Royal Decree), and it becomes time-barred four years after it was committed (art. 15 of Organic Law 12/1995), not the five that art. 4 of the regulation still states. The decision can be challenged, according to its statement of appeal rights, by an appeal for reconsideration to customs itself or by an economic-administrative claim, within one month and never both at once (arts. 222, 223 and 235 LGT).

The claim is filed through the AEAT e-office (sede electrónica), addressed to whoever imposed the penalty, and it is worth including the arguments from the start: if there was no appeal for reconsideration, customs can annul its own decision within the following month (art. 235.3 LGT). It is decided by the TEAR, which has one year to do so, or by the TEAC if the Director of the Customs Department imposed the penalty or, on further appeal (alzada), if the amount exceeds 150,000 euros. Appealing in time suspends the fine without a guarantee until it becomes final at the administrative stage (art. 35.6 of the Royal Decree). After that, two months for judicial review before the administrative chamber of the Tribunal Superior de Justicia or of the Audiencia Nacional (arts. 10.1.d, 11.1.d and 46.1 LJCA), with a court representative (procurador) and a lawyer, no court fee and without the prior settlement attempt that Organic Law 1/2025 requires only in civil matters.

How we run the case, step by step

1. 1

   Fix the dates and obtain the file

   From the notification receipt we work out the last of the fifteen days to respond and request a copy of the file: the seizure report, the valuation record and the photographs. A properly drawn-up report has the status of a public document, so its signatures and witnesses are checked and the evidence to rebut it is prepared (art. 23 of Royal Decree 1649/1998).

2. 2

   Measure the threshold and the classification

   The value is compared with the criminal thresholds, adding other shipments if they could be seen as part of one plan, and we identify which conduct in art. 2 of Organic Law 12/1995 you are accused of. If the matter could end up in the criminal courts, you are told from the start: Managora does not handle the criminal defence.

3. 3

   Redo the valuation

   The calculation is redone with the correct subheading, genuinely similar goods and the date the law requires. A few thousand euros change the grade, the percentage and the minimum fine and, at the edge of the thresholds, decide whether the proceedings remain administrative.

4. 4

   Submissions with evidence within fifteen days

   The firm files the submissions under your authorisation: lawful import, lack of fault or unavoidable error, good-faith third party against confiscation and an alternative valuation, with a proposal of evidence. The same document asks for the goods to be returned or for you to be appointed custodian.

5. 5

   Watch the hearing, the grading and the deadline

   We answer the hearing before the proposal, insist that every aggravating factor is reasoned and that the mitigating factor is applied, and track the expiry of the six months, or twelve if extended, to rely on the lapse of the proceedings.

6. 6

   Appeal within one month and, if needed, go to court

   Against the decision, an appeal for reconsideration if a document customs did not see is enough, or an economic-administrative claim if the dispute is legal, always within one month and with the fine suspended without a guarantee. If the TEAR or the TEAC dismisses it, judicial review within two months, asking the court for suspension and informing the AEAT within that period.

The law that applies

• Arts. 2 y 3 de la LO 12/1995. They define the criminal offence of smuggling: from 150,000 euros for the general conduct and from 50,000 for historical heritage, monopoly or prohibited goods, CITES species, defence material, dual-use items and precursors, with lower or no thresholds for tobacco and the most dangerous goods; they punish it with one to five years' imprisonment and a fine of one to six times the value, and legal persons with a fine of two to four times the value. BOE-A-1995-26836
• Arts. 11, 12 y 12 bis de la LO 12/1995. Below the criminal threshold, conduct with intent or any degree of negligence is an administrative infringement, minor, serious or very serious according to value, punishable by a fine of 100% to 350% of the value with a minimum of 500 euros, with higher scales and minimums for the goods in art. 2.2 and for tobacco, where closure or suspension of the activity may also be imposed. They also make obstruction of the investigation an infringement and set the grading criteria. BOE-A-1995-26836
• Arts. 5, 13 y 14 de la LO 12/1995. Confiscation covers the goods, the instruments, the means of transport and the profits, except lawful goods of third parties in good faith and vehicles of uninvolved third parties where it would be disproportionate; it also applies to administrative infringements, with precautionary seizure before the proceedings are opened. The AEAT's customs bodies have jurisdiction, and their decisions are challenged through the economic-administrative route and then before the administrative courts. BOE-A-1995-26836
• Arts. 2, 4 y 6 a 9 del RD 1649/1998. In their 1998 wording they implement Title II of the Organic Law: their peseta thresholds, five-year limitation period and scale of fines have been overtaken by the Organic Law. They keep the presumption of deliberate concealment in false bottoms, grading from the lower limit of the band, the mitigating factor for goods in lawful trade (15 to 20 points, or 30 to 40 for serious infringements) and the increases for repeat offending and obstruction. BOE-A-1998-21017
• Arts. 16, 17, 25, 34 y 35 del RD 1649/1998. They divide responsibility between the section that investigates and the customs body that decides; require referral to the criminal courts and a stay if there are signs of a criminal offence; require the goods to be valued before the proceedings open; send the proposal straight to the deciding body; and set six months for a decision, extendable once, with lapse, as well as automatic suspension without a guarantee of a fine appealed in time. BOE-A-1998-21017
• Arts. 222, 223, 225, 233 y 235 LGT. They govern the optional appeal for reconsideration within one month, which is decided within another and cannot be combined with a claim; the economic-administrative claim within one month, lodged with the body that issued the act, which may annul it if the filing includes arguments; and suspension, which for penalties is kept without a guarantee until the court decides if the judicial review is notified in time. BOE-A-2003-23186
• Arts. 28 y 29 de la Ley 40/2015. Only those liable through intent or fault may be penalised, and the penalty must be suitable, necessary and appropriate to the seriousness of the act, having regard to the degree of fault, persistence, the nature of the harm and repeat offending. BOE-A-2015-10566
• Arts. 10, 11 y 46 LJCA. Decisions of the TEARs that end the economic-administrative route are challenged before the administrative chamber of the Tribunal Superior de Justicia (regional High Court of Justice), and those of the TEAC before that of the Audiencia Nacional (National High Court); the time limit is two months from notification. BOE-A-1998-16718

Each article checked against the consolidated text published in the BOE (the Spanish official gazette).

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