It has been pretty quiet for a while since the United Kingdom left the European Union on 31 January this year. Is there any news about the conditions under which Brexit will take place? In this flyer you will find the answer.
Although the UK left the European Union earlier this year, nothing will change at all to the relationship between the United Kingdom and the European Union until 31 December 2020. Both parties have agreed that separate agreements would be made about the way in which they split up and that is why we are currently still in a transition period. But after December 31, there will be changes in that relationship that may affect you as well.
Negotiations
At the moment, negotiations are still taking place on a Trade Agreement, the conditions that will apply once the transition period has passed. For example, discussions are being held about the way in which law enforcement, data exchange and security will be dealt with in the future. The last round of discussions on this will take place from 2 October next.
Stumbling Block
The biggest stumbling block in the Brexit negotiations is the border between Ireland and Northern Ireland. The EU wants Northern Ireland to have a separate status. This would make it possible, under certain circumstances, to import without having to pay import duties and VAT. But recently the British Parliament has indicated that Prime Minister Boris Johnson must renegotiate this.
After the transition period
All omens point to the fact that the UK, like China and the United States, will become a so-called “third country” after 31 December 2020.
Trade Agreements
If the UK actually becomes a third country, the UK will have to enter into separate trade agreements with other countries. Such an agreement should then also be reached with the European Union. The end result may be that EU countries do not have to pay any or fewer import duties (so-called “preference”).
In general, it takes a number of years before countries reach a trade agreement. It is therefore not expected that an agreement will be reached between the EU and the United Kingdom this year.
That is why it is now assumed that the UK will levy import duties for EU countries from 1 January 2021. Tariffs have already been set for this, which you can find here.
Delays
Long waiting times may arise on both sides of the border due to border controls. It is also possible that transport companies will not yet have the required permits as soon as Brexit starts. All in all, the delay could be up to 3-5 working days compared to normal turnaround times.
In addition, other practical problems may arise, such as driving licenses that are no longer recognized, changed environmental standards and new standards for trailer dimensions.
All in all, the aforementioned risks can cause transport prices to rise sharply.
What can HealthLink do for you?
Our specialists keep an eye on the situation every day, in order to always be able to offer you the best transport solution. Thanks to our extensive network of supply chain partners, we offer access to all modalities, so you can be sure that enough alternatives are available.
Stock in United Kingdom
Depending on your exact situation, storing your goods in a (bonded) warehouse in the UK can offer a solution. HealthLink can take care of this for you, thanks to our extensive partner network.
Storage locations and infrastructure (especially the various ports in the UK) are expected to fill up quickly. If you are considering moving some or all of your stock to the UK, we recommend that you discuss this with us as soon as possible.
Tips for preparation
Below you will find 7 tips to help you prepare for the new situation as of 1 January 2021.
- Apply for an EORI number. You need this number after Brexit in order to continue trading with the UK. Subsequently, make sure that you are able to file a declaration in the Customs systems.
- Discuss the possibilities of (temporarily) storing your products in the UK with HealthLink.
- Let HealthLink (with a “Classification Application“) or Customs (with a “Binding Tariff Information“ document) indicate under which customs tariff your goods should be classified.
- Check whether you need customs authorization. This could be the case, for example, if you have a customs warehouse or if your imported or exported goods are returned after processing. For example, a customs permit is also required for repair shipments.
- Apply for an “Authorised Economic Operator permit” (the so-called AEO status). Thanks to the AEO certificate, you are much less likely to suffer delays through inspections. In order for the permit to be granted, you must be able to be regarded as a reliable market participant.
- Make sure you have an ‘Article 23 permit’. With this license in hand, you will not have to pay VAT immediately on import.
- Apply for an export license for Dual-Use goods if you export goods with a dual-use character or products for the defense industry from the EU to the UK.
Options via Healthlink
Regardless of the final scenario, HealthLink can of course support you in various areas. For example, we have:
- An extensive transport and warehouse/storage network in the UK, including bonded storage.
- Customs brokerage options in every “port of entry” in the UK.
- Customs and transport specialists who monitor Brexit developments on a daily basis and are in contact with logistics partners in and around the UK.
- Transport independence and with that a wide range of flexible transport solutions, allowing us to select the best transporter, modality and shipping lane for your shipments on a daily basis. Matched to the expected continuously deteriorating incoming and outgoing goods channels in the first weeks after Brexit.
- A Control Tower with transport professionals who keep a close eye on the situation at the borders, seek creative solutions for specific shipments and where possible take measures in the event of delays or major congestion.
- The advanced logistics application Klairy, in combination with customs software and links with Portbase & Cargonaut.
- An experienced tax partner in the UK guiding VAT applications.
Advice
HealthLink can advise you and put you in touch with the appropriate agencies, to ensure that you are prepared for Brexit.
In the run-up to Brexit, HealthLink has put together a team with specialists in areas such as Customs and Transport. They can answer any questions you may have about Brexit and help you on your way where necessary. Send an email to brexit@healthlinkeurope.com or call +31 73 – 3030 500.
Useful link for you about Brexit