What About the B Word?

Date: 16/06/2020
Author: Susana Cordoba
Company: GMCC Trade Team

As the world has been dealing with coronavirus and the aftermath of its impact Brexit has taken a back seat. Now, as we are halfway through the year, governments across the globe including the UK are starting to relax lockdown measures to start our economic recovery. Last week though, Brexit made some headline news as the Chancellor of the Duchy of Lancaster, Michael Gove, formally notified the EU that the UK will neither accept nor seek any extension to the Transition Period.

From the 1st January 2021 the UK will officially leave the EU customs union. Below are some of the changes, which will be implemented in stages, that will start from January:

  • EORI Number: For companies who have only been trading with the EU, you will need an EORI number from January 2021 onwards. All UK VAT registered businesses should have received one from HMRC last year. However, if you have not received an EORI make sure you register for one here.  This will be a unique identification number for exporters and importers.
  • Paperwork: With or without a Free Trade Agreement with the EU, UK & EU companies trading with each other will be required to complete customs paperwork, such as Customs Declarations. Currently, we know that UK importers will have up to 6 months from Jan 2021 to complete their declaration as well as pay for any relevant tariffs. Further clarification is needed for exporters. Equally, Safety and Security Declarations will be needed from July 2021 onwards.
  • SPS Commodities: Whilst some SPS controls will be relaxed for the first few months of 2021 companies can expect increased physical checks from April 2021, and all products of animal origin will be required a pre-notification and relevant health documentation.
  • Northern Ireland: We know there will be a soft border for goods traded between Ireland and Northern Ireland, goods moving from NI to the rest of the UK will be required to go through some form of customs.
  • VAT: Companies will also need to decide how they will account for VAT on imported goods.  UK/EU companies selling on DDP basis may need to consider whether they will be required for VAT in an EU state/UK respectively.
  • Rules of Origin: Post Brexit, what was European value-added will have to be separated into UK and EU value-added and this can make it harder for some businesses to reach the standard 50% threshold to export to the EU without tariffs (Institute of Government). The UK is of course pushing for a more flexible approach on this to benefit UK companies. However, this has yet to be agreed.

So, whilst we welcome the fact the changes will be implemented in stages giving companies more time to adapt, we urge companies and members keep planning and preparing. Whether changes are phased, whether we reach a Free Trade Agreement with the EU or not, trade as we knew it will change.

So, how can we help you?  Here is a list of some of the services we offer to help you Get Brexit Ready:

  • Check our free Brexit hub full of useful links and information to help you prepare.
  • Our free Brexit Readiness Assessments will help UK exporters and importers to understand how ‘ready’ they are.
  • Customs Declarations: We now can act as your customs broker and complete on your behalf export and import declarations.
  • Export Audits - Need help reviewing your existing processes and systems to ensure you remain compliant with post-Brexit? We are accepting bookings now for audits to take place in Autumn and Winter for our Customs and Certificate of Origin/ROO evidence Audits.
  • Training: From Export and Import procedures to Customs Declarations and Incoterms, we have a wide range of technical accredited and non-credited courses which can help your staff to keep up to date with the latest changes.

Interested in knowing more about our services? Visit our website for more information.