ARE YOU READY FOR BREXIT?
With the United Kingdom leaving the European Union on 31 January, an 11-month transition period commences during which we hope that both the United Kingdom and the European Union succeed in negotiating a comprehensive trade agreement, as described in the political declaration.
During the current transition phase, Deutsche Post DHL Group’s cross-border business continues as usual.
Through its global activity, Deutsche Post DHL Group is used to adapting to changing trade conditions and whilst Brexit is presenting all companies with exceptional challenges, we continue to work closely with our customers and remain fully committed to supporting their cross-border trade post Brexit.
What You Can Do to Get Prepared
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Customs Formalities and Import Duties
During the following months of transition, the negotiations between the UK and the EU will continue, but a worst case scenario for businesses is still a no deal Brexit. This would result in the UK becoming a third country without an agreement with respect to its trade with the EU. As a result, their merchandise trade becomes subject to a tariff schedule defined under the World Trade Organisation (WTO).
The EU VAT scheme will no longer be valid after the end of the transition period (1/1/2021). UK VAT will be due on goods imported to the UK from the EU. VAT will be levied together with any customs duties and a customs clearance process will be necessary also if only VAT is due.
VAT will also be due upon the import of goods into the EU from the UK at the rate that applies to supplies of the same goods within the country of importation as it would be the case for any other importation from outside the European Union.
Excise Duty
As with any import from third countries into the EU, excise duties for excisable goods (alcoholic beverages, tobacco products, etc.) will be due and payable when goods are put on the European market. In the future, imports from the UK could also be subject to anti-dumping, countervailing or safeguard measures in the framework of the European Union’s trade defense policy.
Northern Ireland
The movement of goods between GB and NI will be subject to the Northern Ireland Protocol from 01 January 2021. This is designed to ensure that goods are not stopped while moving across the island of Ireland. The final details of the how the Protocol will be implemented are still subject to agreement by the UK and EU but additional processes are expected when moving goods between GB and NI. Goods moving directly between the EU and NI (and vice versa) will not be subject to any new processes.
For more information visit UK Government: Moving goods under the Northern Ireland ProtocolUK Government: Moving goods under the Northern Ireland Protocol
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Following the transition period, companies exporting from the EU to the UK (and vice versa), will need to have an EORI number (Economic Operators' Registration and Identification number). You currently only need an EORI number when trading with countries outside the EU, as its required to release goods from Customs. Post-Brexit you will need this to trade with the UK too. In addition, UK-issued EORI numbers will not be accepted by EU countries post-Brexit, so you will need to register for EU issued EORI number if you want to seamlessly continue trading between the EU and UK. If you currently have an EORI number issued by a different EU Member State than UK, you’ll need to obtain a UK EORI number for post-Brexit UK imports and exports.
You can get UK EORI number via www.gov.uk/eoriUK EORI number. You will get your EORI number by email, usually within 3 working days.
You can register for EU EORI number hereEU EORI Number.
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When importing goods from the EU into the UK a valid UK VAT registration should be provided on the import declarations in order for VAT and duties to be accounted for correctly. From the 1 January 2021 a new scheme to account for import VAT will be introduced for all UK VAT registered businesses. Further details on the links below:
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From 31 Dec 2020 it is expected the UK-EU trading relationship will change. In preparation, your business needs to be clear about some key documents needed when trading internationally (e.g. commercial invoice), and some of the data you need to complete customs declarations (e.g. value of the goods, HS codes).
You can find more support in identifying how your goods are classified via HM Revenue & CustomsHMRC advice on classifying goods or European CommissionEU product classification system resources.
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Does Brexit impact import procedures and processes into UK from non-EU countries?
The procedures and processes for imports from outside the EU27 will remain largely unchanged in the UK.
Will the EORI numbers previously issued by the UK Customs Authorities still be valid for trading with EU Member States or an EU EORI number is needed?
No. After the transition period is over, the UK will become and be treated as a 3rd country. Therefore UK issued EORIs, and other authorisations will no longer be valid as the UK will not be a 'competent authority'. Further details on this are available via the European CommissionEuropean Commission Brexit preparedness.
If a company has EU EORI number and wants to continue to ship to the UK, is there any requirement for a UK EORI number?
Yes, a UK EORI number (starting with GB) is needed. This means cross European traders might end up with two EORIs, one EU and one UK. Further information on how to prepare for Brexit from the UK government is available here.UK Gov Website
Does the EORI cover both importing and exporting goods?
EORI number applies for both imports and exports.
What if goods are imported into UK from non-European countries travelling through Europe e.g. from China?
In this case it should be considered how to clear goods. There is a possibility that the trader would be charged duty upon entry into the EU and then again when goods arrive in the UK.
Customs process after Brexit
Both the UK and EU are preparing a number of measures to minimize disruption at the borders and minimize negative effects on businesses.
The UK have announced a phased approach to import measures from 1 January to 30 June 2021 for standard goods entering from the EU. This will only apply to EU-GB trade and will not apply to GB-NI. From 1 July 2021, full customs declarations will be required on goods entering from the EU at the point of importation to the UK.
Further guidance is available hereHow to import and export goods between Great Britain and the EU from 1 January 2021.
Customs on the EU side
Customs authorities will carry out controls on the basis of the Union Customs Code, according to the common risk-based system applied to any other external border of the Union with regard to the movement of goods in relation to third countries. These controls are likely to lead to increased administrative burdens for businesses and longer delivery times in logistical supply chains.
Further guidance is available hereGetting ready for the end of the transition period.
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Preparing for Brexit
UK Government - The Transition PeriodUK Government Import, Export & Customs for Businesses
EU Preparedness Notices for BrexitEU Preparedness Notices for Brexit
National Brexit Information for EU Member StatesNational Brexit Information for EU Member States
Customs, Taxes, EORI
EU Member States National Customs InformationEU Member States National Customs Information
HM Revenue & Customs Advice for Classifying GoodsHM Revenue & Customs Advice for Classifying Goods
EU Product Classification SystemEU Product Classification System
