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Don’t get left behind – check what you need to do to continue trading with the EU

9:00 am, Thursday, 17th December 2020 - 2 years ago

Brexit

The countdown to the end of the UK transition period is well underway. Businesses of all sizes must take urgent action if they want to continue to trade with Europe.

Firms will have to make a number of changes to make sure that goods, data, people and services can continue to flow smoothly between the UK and the EU.

The Government has put a range of measures in place to offer support to companies of all sizes on gov.uk/transition.

If you import and export goods to the EU, Government has set out six key areas to check:

  1. Use gov.uk to find out what regulations apply to your product that you sell to the EU. New product approvals may be required. You will need to speak to your supply chains and distributors. Consider what new marking and labelling may be required for your product.
  2. Look up “Check how to export goods” on gov.uk for information on overseas tariffs, rules and new border arrangements. Changes are coming in from January 2021. If you don’t complete the proper documentation or follow the correct procedures, it may result in delays getting goods through customs as well as unexpected taxes on goods on entry to the destination and country.
  3. Import tariffs: Check what tariff is payable on goods entering the UK from January 2021 on the new UK Global Tariff schedule: gov.uk/guidance/uk-tariffs-from-1-january-2021.
  4. Import VAT: If you import any goods from the EU, you may need to pay Import VAT from January 2021.
  5. EU Settlement Scheme: if you employ EU, EEA or Swiss citizens, you can signpost them to the information they need to secure their future in the UK. That deadline is 30 June 2021.
  6. Data: If you’re a business that receives personal data from the EU you may need to take action.

Cllr Philip Jackson, Leader of North East Lincolnshire Council, said: “We have a number of businesses in our area that regularly trade not only with the EU, but across the globe.

“There has been a lot of work already done, but we know there are instances of businesses that haven’t checked what they need to do yet. Everyone who deals with the EU, whether moving goods in and out of our ports or employing EU nationals has their part to play.

“If you haven’t already checked, I’d urge you to do so as soon as possible, and if you need help, contact the various helplines available.”

Case studies:

Paul Beatty: The Online Fulfilment Centre, Grimsby

The Online Fulfilment Centre, based in The Enterprise Village, in Grimsby, provides fulfilment services for a number of online retailers including Grimsby’s very own Docks Beers.

Paul Beatty, Managing Director at the company explained: “Our work entails sending retailers’ products out to customers all over the world, in particular to within the EU.

“In terms of planning for EU Exit, like other companies, it’s been quite difficult to know exactly what to do given there’s no trade deal in place. We have had to think about how either having a trade deal of not having a trade deal would affect us and make more than one plan.

“The key thing that we have had to do is look at becoming a bonded warehouse, as many of our clients source their stock from the US, which normally means there is VAT due on it, but as a lot of that product will be going out of the UK, then that VAT is not applicable. However, for us to process and not have to pay that VAT we need to become bonded. The likely alternative would be that our clients would have looked to storing and sending their products out from within the EU, with Ireland looking the most likely option.

“The process in becoming a bonded warehouse is not a straightforward one and we knew that we would struggle without expert guidance. We hired a specialist consultant to help us with this. We had great help from E-Factor in both finding expert advice and also helping us to find funding to help with the costs.

“I think EU Exit is going to be difficult to start with as no-one really knows exactly what is going to happen at the moment.

“I would advise all companies to get expert advice, plan for different scenarios and look to see if funding is available to help with this huge transition.”

Case study: Karen Kennedy, Achtis

Achtis are a local company, based at Europarc in Grimsby, providing specialist flooring products, and their innovative strapless spiked overshoes for flooring installers.

Their EU current customer base is primarily based in Germany, but they distribute their products to 19 countries across the world.

Karen, Director of Achtis, said:

“We’ve been importing and exporting for several years now, but we’ve still had a lot of work to do to make sure we’re ready for EU Exit.

“In terms of imports, we’ve talked with our hauliers, we’ve been through a checklist from e-Factor, and we think we have that bit under control.

“Regarding exports, there’s going to be lots of new paperwork as we predominantly export to the EU. It will be similar to the paperwork for the rest of the world, there will just be a lot more of it.

“We’ve had a huge amount of help from DIT and E-Factor. The key thing for both exporting and importing is not to panic – there are lots of people there to offer advice and help you to get things right, all you have to do is ask.

“COVID has had a massive impact across the globe, and I think this is likely to continue to cause issues in the coming months. We’ve had containers held in different countries as port authorities have understandably prioritised health products in the last few months which has led to delays in fulfilling customer orders. We’ve also had the heads up from hauliers that they are warning of tailbacks through the southern ports from the 1st January 2021 and we are passing that information on to our customers.

“Having said all that, if you’re a business that’s thinking of diversifying and trying the European market, I’d say “Do it”. We never anticipated we were going to be an international firm when we started up, but that’s the backbone of our business now.

“There’s lots of different people and companies out there to help, and they’ve all been brilliant, wanting to work together to move your business forward – from the free HMRC workshops, local advice from E-Factor or DIT (Department of International Trade) colleagues, all you have to do is ask.”

Gavin Legg, Customs Manager, Ocean Blue Logistics

Ocean Blue Logistics are a freight forwarding company with offices in Grimsby, Hull, Bradford and Glasgow. The business uses ports across the country, predominantly Immingham, but also the southern ports, to ship freight of all types between the UK and the rest of the world, with much of it going through the EU ports.

Ocean Blue Logistics has also secured Authorised Economic Operator status through the UK Government, an internationally recognised quality mark which will indicate that their role in the international supply chain is secure and their customs controls and procedures are efficient and compliant, and as such, can be considered as a “secure” trader and a reliable trading partner.

Gavin said: “We’ve actually been Brexit-ready for many years, as we deal with many countries outside EU. However, since the referendum, we decided to set up a new department, with additional experienced staff, as a result, knowing that the volume of work would likely increase significantly.

“In the last year, with the pandemic, we have seen significant changes to the shipping trends already – with higher demand on vessel space increasing the costs worldwide.

“However, we’ve been taking the time in the last 18 months or so to help explain to our customers what they need to do to continue trading with Europe. From directing customers to becoming EORI registered to some of the really detailed work around individual product codes, we know it’s complicated, and will be relatively new to a lot of businesses.

“We also know, however, that if we can help our customers through that paperwork journey in the first few instances, we can help them to understand the system and make it easier in the long run for everyone.

“It’s going to be tough for everyone, but we’re here to advise and help through every step. We’re like a family here. We believe in not only helping customers where we can, but also helping them to help themselves.

“It’s an incredibly busy time at the moment – we’ve taken the decision to contact our customers proactively to make sure they’re ready for 1 January. Whilst it might be a bank holiday for some, unfortunately, freight forwarding is a 24/7 operation, and we need to hit the ground running from day one.”

Useful resources:

UK Government Transition portal: Brexit transition – GOV.UK (www.gov.uk)

The Greater Lincolnshire LEP: https://www.businesslincolnshire.com/business-resilience/eu-transition-support/

E-Factor have also run a two-part series of webinar panel discussions on EU Exit: https://e-factorbusiness.co.uk/webinar-recordings/

E-Factor advisors are also available at www.e-factorbusiness.co.uk. They will be able to put any local firm in touch with experts in almost any field and particularly experts from sectors such as food, logistics and health.

ENDS

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