BREXIT: CUSTOMS, CODES AND CONTINGENCIES

14/01/2019

As I write, there are now only 11 weeks until the UK formally leaves the European Union.

Even so, despite more than 30 months have passed since the historic referendum withdrawal and successive, intense rounds of negotiations with the EU, we are no closer to establishing the firm and final shape which Brexit will take.

More to the point, we cannot know for the time being what impact it will have on ourselves and the many client companies which rely on Simarco to handle their exports and imports to and from Europe and the rest of the world.

Regular readers of this 'blog will now be aware, we recognised the need to be as fully-informed about the potential implications almost as soon as the referendum outcome became clear.

 

We not only set up a team of senior managers to assemble the most appropriate and helpful information for clients but opened a dialogue with officials both in Westminster and Brussels.

As a result, we believe that, whatever happens, we are confident that the contingency arrangements which we have put in place, including a comprehensive network of depots across Europe, will insulate clients from disruption and maintain service continuity when transporting goods by road between the UK and the EU.

However, we believe that, in the absence of a final resolution, it's important to plan as though the so-called 'no deal Brexit' will happen.

That would mean the UK no longer being bound by EU laws or benefitting from free trade with the remaining 27 member states. It would, therefore, entail Customs formalities and border controls being reinstated.

If your business currently trades with counterparts across the continent and you intend continuing to do so, you must register for something known as a UK Economic Operator Registration and Identification Number (or EORI, for short).

HMRC has provided a guide about how to do just that (https://www.gov.uk/eori).

In addition, we would advise that exporters and importers begin familiarising themselves with the kind of product information known as 'Commodity Codes' which will need to be declared on commercial invoices.

We would recommend that companies who have not previously had to classify their products start this process as soon as they can. Again, HMRC has come up with a guide (https://www.gov.uk/trade-tariff) to enable Simarco and its European counterparts to complete import and export Customs' entires on your behalf in a timely manner.

Of course, the Brexit situation remains subject to flux.

Things could change if the House of Commons decides to throw its weight behind the draft agreement between the Prime Minister, Theresa May, and her EU counterparts. It has already been supported by the House of Lords.

That Commons' vote is scheduled to take place on Tuesday (15th of January) having already been postponed before Christmas.

Nevertheless, we believe that being pro-active and putting effective contingencies in place is entirely worthwhile, especially as our intelligence suggests that ministerial assurances about the Customs Declaration Service (CDS) being in place by the end of March (https://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2018-12-06/199789) may - at the very least -be rather ambitious.

Whilst some within parliament even believe that Brexit might not take place, we firmly regard planning as though it will could protect businesses from even more turbulence, uncertainty and surprise.