TC09625 - [2025] UKFTT 01066 (TC)

Mr Mciver took exception to the fact that the Application did not relate only to Brands and GB, but also to “other suppliers to those persons identified by HMRC as forming part of the backwards supply chains”; he submitted that its scope was too wide. He compared UWG’s position with the facts of other cases, saying that in Hughes the issue was with the identity of one person who had stored the goods, and in another case, Essex Trading Ltd (Footnote: ³), the missing piece of the jigsaw was whether a specific company, Hi-Line Ltd, was the holder. In contrast, said Mr Mciver, UWG was not looking for a missing piece, but for “the whole jigsaw” and was on a “fishing expedition” to see what it could find in order to build a defence.

That is an unfair characterisation of UWG’s position. It is clear from Dawson UT (approved by the Court of Appeal) that in order to succeed in proving it was not liable for the duty, UWG must satisfy each of the Factors set out at §13. Factor 2 requires UWG to identify “the person alleged to have de facto or legal control over the goods who it is said should be assessed rather than the subsequent holder…and how that person is said to have such control and the basis on which it was being exercised”. In Hartleb,the UT endorsed and followed the approach in Dawson, confirming that physical possession “is not the end of the matter and a more detailed consideration of the facts is needed”. Thus, it is not sufficient for UWG to identify a person, such as Brands or BG, who supplied the goods; UWG must also prove that the person in question had de facto or de jure control over the goods after they were released from consumption. As the UT say in the same passage, “control might have been exercised by another entity earlier in the chain of supply in compliance with a request by the person in question to deliver them to the subsequent holder”. Factor 3 requires the time the duty point arose to be identified, and Factor 4 requires UWG to prove where the goods were held at that time. In casting the Application in wide terms, Mr Thornton was doing no more than reflecting the Factors which UWG have to prove.

While it is true that the issues in Hughes and Essex Trading were narrower, that is simply a consequence of the particular fact patterns. As Sales J said in Ingenious: “If the circumstances of a case are such that comparatively wide or general orders for disclosure are necessary to enable the FTT to deal with that case fairly and justly, the Rules are intended to enable a party to make such generalised requests for disclosure”.

Relevant facts in this case were that:

Mr Mciver explained the references to “missing traders” in the above passages by saying that as the traders were “missing”, it followed that HMRC could not obtain sufficient information to establish that they were prior holders. However, he accepted that HMRC could not refuse to assess an impecunious or absent previous holder, including a missing trader, if there was sufficient information to make the assessment, see Ali.

Given the facts of this case, it is not a “fishing expedition” for UWG to ask the Tribunal to direct that HMRC provide the information it holds about the supply chains, the missing traders, the role of the entities in the supply chains and the delivery arrangements. All that information was available when HMRC decided UWG was liable to excise duty as the first holder of the goods, and it is entirely reasonable and in the interests of justice for it to be disclosed to UWG.