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Cross-border trade

Have you considered the following?

Cross-border trade

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Context

In the event of a no deal Brexit, UK businesses trading with the EU will need to register for an Economic Operator Registration and Identification number (EORI) number to continue trading.

Your business should consider

Has your business registered for an EORI number to continue trading with the EU in the event of a no deal? UK Government guidance on EORI numbers: Get a UK EORI number to trade within the EU.

UK/EU customs and excise checks

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Context

As a ‘third country’, UK exporters to the EU after Brexit may in future be required to make customs declarations.

Your business should consider

What customs procedures do you comply with for trade with non-EU markets?

Are you ready, if the need arises, to apply these to imports from or exports to the EU?

Resources and information

HMRC has published an information pack to help businesses plan ahead plan for the contingency of a ‘no deal’ EU Exit. https://www.gov.uk/government/publications/partnership-pack-preparing-for-a-no-deal-eu-exit


To register for the HMRC’s EU Exit update service for future guidance and updates: on GOV.UK, search for ‘HMRC videos, webinars and email alerts’, click to register to get business help and education emails, enter your email and select ‘EU Exit’.

See the UK Government's technical notice on trading with the EU if there's no Brexit withdrawal agreement: http://www.gov.uk/government/publications/trading-with-the-eu-if-theres-no-brexit-deal

See the UK Government's technical notice on exporting controlled goods if there's no Brexit withdrawal agreement: http://www.gov.uk/government/publications/exporting-controlled-goods-if-theres-no-brexit-deal

Arrangements for importers or exporters, using roll on roll off ports or the Channel Tunnel to transport goods between the EU and the UK in the event that the UK leaves the EU without a deal: https://www.gov.uk/guidance/moving-goods-to-and-from-the-eu-through-roll-on-roll-off-locations-including-eurotunnel

HMRC have released a short video on what to consider when importing or exporting goods from the EU to the UK in a no deal EU Exit.

If the UK leaves the EU on 29 March 2019 without a deal there'll be changes to how businesses trading in excise goods (alcohol, tobacco and certain oils) move and declare these goods. Businesses would no longer be able to use the Excise Movement Control System (EMCS) to move excise duty-suspended goods to the UK from the EU: https://www.gov.uk/guidance/moving-and-declaring-excise-goods-in-the-event-the-uk-leaves-the-eu-with-no-deal

Potential delays at UK/EU border

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Context

With potential customs checks between the UK and the EU, there may be delays at the border.

Your business should consider

The potential of customs checks to cause delays at the border will depend on how new policies are implemented in practice: customs checks are typically risk-based rather than universal. As yet there no details on how enforcement might be executed in practice.

How resilient is your supply chain to potential border delays?

Do any contracts you have include penalties for late delivery? You may want to discuss with your logistics provider whether you would require new arrangements.

Do you need to increase your inventory and/or buy additional storage space?

Resources and information

HMRC have released a short video on what to consider in a no deal EU Exit regarding changes at the UK Border.

HMRC have also provided some industry specific information:

Tariffs on UK-EU trade

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Context

The British Chambers of Commerce has been advocating for zero tariffs on trade between the UK and the EU after Brexit.

However, businesses should consider the potential impact of a situation where there are tariffs between the UK and the EU – based on the EU Most Favoured Nation (MFN) tariff (which applies to countries that do not have a special agreement with the EU).

Your business should consider

Do you know the HS codes (international classification system) for your products? Do you know the EU MFN tariff that is applicable for your product?

If the UK and the EU do not reach an agreement that removes all tariffs, what would the impact of the MFN tariff be on your cost base?

Resources and information

HMRC has published an information pack to help businesses plan ahead plan for the contingency of a ‘no deal’ EU Exit: https://www.gov.uk/government/publications/partnership-pack-preparing-for-a-no-deal-eu-exit

UK Government technical notice on trading with the EU if there's no Brexit withdrawal agreement: http://www.gov.uk/government/publications/trading-with-the-eu-if-theres-no-brexit-deal

UK Government technical notice on classifying your goods in the UK Trade Tariff if there's no Brexit withdrawal agreement: http://www.gov.uk/government/publications/classifying-your-goods-in-the-uk-trade-tariff-if-theres-no-brexit-deal

UK Government technical notice on trade remedies if there's no Brexit withdrawal agreement: http://www.gov.uk/government/publications/trade-remedies-if-theres-no-brexit-deal

Rules of Origin in UK-EU trade

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Context

Even if the UK has a zero-tariff trade agreement with the EU, companies will need to prove that their product is of UK origin to benefit from this (usually, this means that 50-55% of the product has to be locally sourced). The exact terms of these rules between the UK and the EU are yet to be negotiated.

Your business should consider

If you are a supplier, has your customer asked you to provide proof of where you source your content? Would you be able to provide it if asked?

If you buy your components from local suppliers, have you thought about conducting an audit of where they source their materials?

Resources and information

UK Government technical notices on EU FTAs if there’s no Brexit withdrawal agreement: http://www.gov.uk/government/publications/existing-free-trade-agreements-if-theres-no-brexit-deal

EU trade agreements with third countries

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The UK Government has indicated its intention to secure the benefits of existing EU trade agreements with other countries. However, businesses may need to consider a scenario where the terms were to change and preferential trade terms are no longer available.

Your business should consider

Do you import or export using lower duty rates (‘preferences’) provided by the EU’s existing trade agreements?

How might changes to, or the ending of, these preferential rates impact you?

If you are supplying to a partner in the EU who is exporting to a third country with which there is an agreement, please be aware that EU firms have been encouraged to look for EU-only (not UK) content to be able to benefit from lower tariff rates. Consider if there is any way for you to mitigate this.

Customs facilitations, reliefs etc

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Context

There are a number of duty relief schemes available to UK businesses.

Your business should consider

It may be worthwhile for your business to consider applying for these.

There is also a trusted trader scheme – Authorised Economic Operator (AEO) – that may be relevant to you if your supply chain also takes part in it. Please speak to your local Chamber to learn more about these.

Will your business handle new Customs and Safety and Security Declarations in-house or with a third-party?

If your business is exporting live animals or animal products, do you have the right documentation (e.g. Export Health Certificate, Catch Certificates, equine/plant IDs)? And are your drivers aware of the required documents?

If you are importing certain types of food and feed of non-animal origin, you may be subject to increased import controls. Have you considered the requirements for certain types of goods to enter through Border Inspection Posts and/or Designated Points of Entry?

You can now register for simplified import procedures if the UK leaves the EU without a deal: https://www.gov.uk/guidance/register-for-simplified-import-procedures-if-the-uk-leaves-the-eu-without-a-deal

Resources and information

Do you plan to apply for additional customs relief or trusted trader schemes from HMRC? Read more about them at www.gov.uk/duty-relief-for-imports-and-exports & http://www.gov.uk/guidance/authorised-economic-operator-certification

Customs/export training

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Your business should consider

Do you have a member of staff knowledgeable in customs and export?

Would it be valuable to train a member of staff in this area?

Resources and information

Chambers of Commerce are able to provide both ongoing support and relevant training. Find your local Chamber here.

HMRC have announced a programme of training and IT support for customs intermediaries in December. The purpose of the training is to give traders an understanding of how to compile the information needed for simple import and export customs declaration entries.HM Treasury and HMRC announced a one-off investment to support broker training and increased automation. As part of this investment, funding has been set aside for grants to help meet the upfront costs of employee training and IT improvements: https://www.customsintermediarygrant.co.uk/

Incoterms

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Your business should consider

Are you familiar with INCOTERMS?

Knowing the International Terms and Conditions of Service will help you set the right contract terms to reflect potential changes of status (becoming an exporter/importer) once the UK leaves the EU.