Are you "Brexit ready"?
Brexit three phase strategy
The transition period ends on 31st December 2020, the existing EU trade rules will no longer apply. It is expected that customs formalities will be introduced as of 01/01/2021. The UK Government have indicated new rules will be introduced gradually in a “three phase strategy”, which is a plan for the first six months of 2021. See details below:
Phase 1 – from January 2021
Export. All exports from the UK to EU will be subject to customs clearance formalities from day one.
Import. Standard Goods imported from the EU (such as clothes or electronics) will have up to 6 months to complete customs declarations and pay any import duties.
Phase 2 – from April 2021
Import. Animal origin (such as meat, honey or milk) and all regulated plants and plant products will require pre-notification and relevant health documentation.
Phase 3 – from July 2021
Import. All goods will be subject to full customs declarations, tariffs and duties. Full safety and security declarations. Physical checks at UK Border Control Posts.
As the UK will come out of the agreed transition at 23:00hr 31 December 2020 (GMT). It’s vital that Importers, Exporters and transport businesses prepare in advance. Failure to do so will result in lorries being prevented from crossing the border. ALL lorries must have complete documentation for ALL shipments BEFORE lorries will be permitted to board ferries or trains. This will be the case with or without a “deal”, customs controls will apply between GB and the EU from 01/01/2021.
Anyone importing or exporting goods between Great Britain & the EU needs to understand who is responsible for deciding how goods will be moved and who will submit paperwork on behalf of importers and exporters. The checklist below is designed to point you towards the basic decisions that need to be taken before 01/01/2021.
Brexit Check List
*Please note this check list has not been arranged in any particular order, you should check all the points, depending on your business and your circumstances you may need to seek more guidance and information.
1. Have you agreed IncoTerms with your customer or suppliers?
Info: You need to agree terms of trade with your customers and suppliers ASAP. Incoterms define what part of the shipment and custom clearance process you are responsible for. Our simple Incoterms guide is here and you can find out more about IncoTerms here and here.
2. Apply for a Duty Deferment Account.
Info: Traders who import goods regularly may benefit from having a duty deferment account (DDA). This enables customs charges including customs duty, excise duty, and import VAT to be paid once a month through Direct Debit instead of being paid on individual consignments. VAT registered traders can instead account for import VAT on their VAT return using postponed VAT accounting. You can find out how to apply here and here. Link to application is here (you will need yor Goverment Gateway Login)
3. Have you got your EORI Number?
Info: UK Traders will need a UK EORI Number to be able to trade with the EU by road. To apply for EORI click here. Your EU suppliers and customers will also need their own EORI number, please make sure they have this – they need to follow their own country application process.
4. Do you know your Commodity Codes?
Info:You need to know the commodity codes for the goods you will be moving. Commodity codes are needed for customs declaration. You will needs to communicate them to whoever is doing your customs declarations. A link to the UK Govt website where commodity codes can be obtained is here.
5. Have you decided and arranged who will do your custom declarations?
Info: Unless you’re planning to do it yourself, you must arrange for an agent or logistics company to arrange your customs declarations. Salvatori can help you please register your intrest using this form. This may be difficult to secure, but essential if you wish to continue to import or export with the EU.
6. Are you ready to raise correct commercial invoice? Are your suppliers ready to issue correct commercial invoices to you?
Info: Not all Commercial Invoices produced by company accounting systems produce invoices that contain the right data to complete customs or other border processes. Traders need to act now to ensure goods are properly identified, you can find sample template in our Useful Docs section.
7. Do you need a special license?
Info: You’ll need to get a license or certificate to import or export some types of goods. If you move controlled goods such as Excise Goods, Foods, Chemicals, etc you may need an Export or Import license.
8. Can you register for simplified procedures?
Info: You may be eligible to register for simplified custom procedures. These are slightly different for Import and Exports, but they are designed to allow the start of the process by making an entry in your own records and make supplementary declarations later. Find out more on import and export simplified procedures. These however do not apply to controlled goods.
9. Is your packaging material compliant?
Info: From 1 January 2021 all WPM (wood packaging material – such as pallets, crates or boxes) moving between the UK and the EU must meet ISPM15 international standards by undergoing heat treatment and marking. All WPM may be subject to official checks either upon or after entry to the EU. You can find out more details here.