Montenegro has started implementation of a new Excise Movement and Control System (EMCS) designed to bring the movement of fuel, tobacco and alcohol products under a real-time electronic monitoring framework aligned with European Union practices.
The Customs Administration formally launched the project on July 20, 2026, with participation from representatives of the Ministry of Finance, the EU Delegation, the Ministry of Public Administration, the Central Finance and Contracting Directorate and the project contractor. The upgrade will transform Montenegro’s existing national excise application into a system capable of electronically tracking goods moving under excise-duty suspension.
Excise Revenue Exceeds €185 Million in First Half of 2026
The project has an estimated value of €600,000, while the fiscal segment it supports represents a significantly larger revenue stream for the state. Excise duties generated €185.1 million for Montenegro in the first six months of 2026, increasing by €5.2 million, or 3 per cent, compared with the same period of 2025.
Excise revenues represented more than a quarter of the €675.9 million in customs-administered revenue collected during the first half of the year. Based on the first-half collection pace, annual excise revenue could approach €370 million, depending on seasonal consumption patterns for fuel, tobacco and alcohol products. An improvement equivalent to 0.5 per cent of this indicative annual revenue would represent approximately €1.85 million.
Digital Tracking Replaces Fragmented Excise Records
The EMCS project is intended not only to improve tax collection but also to change how excise liabilities are established, secured and released during the movement of goods through supply chains. Excise duty is generally payable when goods are released for consumption. Fuel, tobacco and alcohol products often move between import points, tax warehouses, producers, distributors and exporters before reaching that stage.
The duty-suspension model allows authorised goods to move without immediate payment, provided that movements are controlled and potential tax obligations are secured. For compliant fuel distributors, breweries, wineries and tobacco importers, this reduces the amount of working capital tied up before products reach their taxable destination. The same system also creates risks when goods moving under suspension are diverted, falsely declared as exported or fail to reach their registered destination. EMCS introduces a digitally traceable process designed to replace paper-based documentation and fragmented databases.
Electronic Documents Will Monitor Excise Shipments
Under the upgraded system, an authorised consignor will submit an electronic Administrative Document (e-AD) before dispatch. The system will validate the information and issue an Administrative Reference Code (ARC) identifying the individual consignment. The electronic document will be transmitted to the destination authority and consignee. After delivery, the consignee will submit an electronic report of receipt, allowing the movement to close and the financial guarantee to be released or adjusted.
If there are differences in quantities, incorrect destinations, delays or missing receipt confirmations, the system will generate an electronic discrepancy visible to authorities. Officials will then be able to determine whether the issue resulted from an administrative mistake, transport loss, incorrect documentation or possible diversion.
Businesses and Logistics Operators Must Adapt
The companies directly affected by the transition include:
- authorised warehousekeepers;
- registered consignors;
- registered consignees;
- fuel importers and distributors;
- breweries;
- wineries;
- distilleries;
- tobacco operators;
- logistics companies transporting excise goods.
Customs brokers and software providers will also need to adjust because electronic message accuracy and timing will become part of the commercial movement process. For compliant operators, the system is expected to provide faster processing, fewer paper documents and more predictable closure of excise guarantees.
Product codes, quantities, tax categories, operator authorisations, transport information and destination details will need to be correct before a shipment begins. Errors that were previously resolved through additional paperwork or communication between offices may become system exceptions capable of delaying dispatch or preventing closure of movements.
Large fuel and tobacco companies are expected to integrate the system through existing compliance and enterprise-resource-planning systems, while smaller producers and distributors may require additional support, specialised software or intermediary services.
Upgrade Will Connect Montenegro With EU Excise Systems
The project documentation indicates that Montenegro plans to upgrade its existing EMCS version 3.2 application to EU Phase 4.1, or the latest available EU phase during implementation.
The project includes:
- analysis of current business processes;
- system architecture redesign;
- preparation of functional specifications;
- software development;
- testing;
- validation;
- user training.
The upgraded platform will also need to connect with the EU’s System for Exchange of Excise Data, the Automated Export System, customs information systems and platforms managing authorisation and authentication. The planned contract duration is 30 months, with financing provided through the EU’s Instrument for Pre-accession Assistance. Depending on the contract start date, implementation could continue into late 2028 or early 2029.
EU Interoperability Requires Operational Readiness
Montenegro must ensure that the system can exchange messages with external platforms, maintain accurate operator registrations, align national and European data and allow the Customs Administration to manage failures, irregularities and security incidents. The EU has operated EMCS since 2011, with more than 200,000 registered operators using the system.
The platform initially covered movements under duty suspension but has expanded over time. Since February 2023, EMCS has also covered commercial cross-border movements of excise goods for which duty has already been paid in one member state. These movements use an electronic Simplified Administrative Document (e-SAD) and involve certified consignors and consignees.
Since February 2024, EMCS Phase 4.1 has introduced deeper interoperability with the EU’s Automated Export System. Montenegro is therefore upgrading towards a wider network connecting tax, customs, export and operator-registration systems.
Export Integration Could Improve Guarantee Release
The connection with the Automated Export System is particularly important for excise goods declared for export.
Under previous procedures, excise movements and customs export procedures could remain separate, creating uncertainty over whether goods had actually left the customs territory and whether excise guarantees could be released. A functioning interface would allow export and excise information to be compared automatically.
If customs confirms export, EMCS can complete the related excise movement. If an export declaration is rejected, amended or left incomplete, authorities can identify the discrepancy without manually comparing separate records. For fuel, alcohol and tobacco exporters, this could reduce delays in releasing guarantees.
EMCS Follows Customs Digitalisation Progress
The project follows Montenegro’s integration into the New Computerised Transit System (NCTS) and accession to the Convention on a Common Transit Procedure in November 2025. That system enabled goods to move between Montenegro, the EU, EFTA countries and other convention members under a common electronic transit procedure. The EU provisionally closed Montenegro’s negotiating Chapter 29 on the Customs Union on July 14, 2026.
Customs transit and excise control remain separate systems. NCTS tracks goods under customs transit, while EMCS follows the tax status of excise products. A single shipment may involve customs, transit, export and excise processes that must exchange information without creating conflicting records.
EMCS is primarily linked to Montenegro’s work under Chapter 16 on Taxation, which had not yet been provisionally closed when the project started. The Customs Administration identified EMCS implementation as a requirement under the chapter’s third closing benchmark. Montenegro has provisionally closed 18 of 33 negotiating chapters.
System Reliability and Cybersecurity Identified as Key Challenges
The new platform will introduce another time-sensitive commercial process into Montenegro’s digital customs infrastructure. In June 2026, an interruption in electronic message exchange temporarily disrupted customs procedures. The central Customs Information System remained operational, but messages from economic operators could not be received. Transport representatives reported that some trucks waited up to 17 hours at the Božaj border crossing.
Similar disruptions affecting EMCS could prevent goods from legally departing under suspension or delay the closure of movements and release of guarantees.
Montenegro will therefore need business-continuity procedures defining when fallback documents can be used, how they are later entered into the system and how misuse is prevented. Cybersecurity will also be important because EMCS will contain commercial data on product volumes, customers, routes, warehouse activity and high-value shipments. The system will connect with authorisation, export and customs platforms, requiring secure access controls and reliable data protection.
Data Quality and Operator Registration Require Preparation
The EU system relies on the System for Exchange of Excise Data (SEED) to verify whether operators are authorised for specific excise activities and product categories. Incomplete or inconsistent national records could result in legitimate transactions being rejected or incorrect transactions being accepted.
The pre-launch period will therefore require review of:
- excise authorisations;
- tax warehouse information;
- registered premises;
- product categories;
- authorised roles.
Businesses will need to verify their records before the system becomes operational.
New Digital Records Could Change Supply Chain Management
EMCS will not eliminate financial guarantees but will create a more precise connection between guarantees and individual movements. Depending on the legal structure, responsibility for securing potential duty may involve warehousekeepers, consignors, consignees, carriers, product owners or combinations of these parties.
Commercial agreements may need to define responsibility for:
- submitting electronic documents;
- providing guarantees;
- reporting receipt;
- resolving shortages;
- paying duties in case of irregularities.
The Customs Administration will also gain additional risk-analysis capabilities, allowing it to identify unusual shipment volumes, repeated route changes, unexplained shortages, frequent destination changes and movements that fail to close on time.
Fuel represents the largest fiscal exposure because of high volumes and the impact of small differences between declared and actual quantities. Montenegro is separately introducing a system for marking petroleum-derived liquid fuels and biofuels, with different markers for taxed and exempt products. Combining fuel marking data with EMCS movements, import declarations and domestic excise records could allow authorities to compare physical products in the market with their tax records.
Tobacco remains sensitive because excise duties represent a significant part of retail prices, while alcohol includes both large commercial operators and smaller producers such as wineries and distillers. The implementation of EMCS will depend on whether Montenegro can successfully connect electronic records, operator data, customs procedures and tax controls into a functioning real-time system.
