Brexit update: where are we now?

For companies doing business with the UK, a number of things may change as of 29 March 2019. This close to the deadline, it is still not clear whether we will be faced with a "hard" Brexit where the UK immediately exits the customs union completely or whether there will be another variant. As best we can prepare, we must now assume that there will be a hard Brexit; then things can only go better.

Read the key points here

HM Revenue & Customs (HMRC) has written several articles on this subject and we summarise the most important points below. From a European perspective, you can also find useful tips and checklists in this article.

In short, what happens technically to customs in the event of a hard Brexit?

Then many companies in the United Kingdom will have to apply the same procedures to trade with the European Union as they apply to trade with the rest of the world. This means that imported goods are not released by customs until an import declaration has been made and any duties due have been paid. Companies in the European Union exporting to the United Kingdom (or importing products from the UK) must also take into account various enhanced regulations and procedures.

"Figures from Dutch Customs show that some 35,000 Dutch companies do business with the United Kingdom, and do not otherwise import or export outside the European Union. Customs and customs formalities are therefore unknown territory for them."

Source: Customs

According to the European Commission's Customs Guide, this includes:

customs formalities will apply, export and import declarations have to be lodged
veterinary and other product controls may apply
customs duties will have to be paid on goods entering the EU from the UK
VAT is payable on import from the UK on entry into the EU (this can be shifted to the importer's administration by means of a so-called "Art.23 licence")
there may be bans or restrictions on certain goods entering the EU from the UK which may require import or export licences
the Authorised Economic Operator (AEO) licences issued by the United Kingdom will no longer be valid in the EU (EU 27)
the rules for declaring and paying VAT (for supplies of services such as electronic services) and for cross-border VAT refunds will change
the transfer of goods to the United Kingdom will require an export declaration
an electronic administrative document (e-AD) may be required for the movement of excise goods to the United Kingdom
for excise goods moving from the UK to the EU (EU27), customs formalities must be completed before a movement under the Excise Movement Control System (EMCS) can begin

What will be the biggest Brexit challenge?

Dutch industrial companies expect a hard Brexit to result in major delays at the border, more complex procedures and administrative hassle.

What is the UK government doing about these challenges?

HMRC has introduced simplified transition procedures to make it easier for UK businesses to import goods from the EU through locations such as Dover or the Channel Tunnel. UK businesses already trading outside the EU that have a customs agent or software can use it to make declarations of trade between the EU and the UK. Other businesses will have to actively appoint an agent or start making declarations themselves.

And the rest of the European Union (including the Netherlands)?

In the Netherlands, the tax authorities have actively informed known entrepreneurs who do business with the UK about a number of areas of interest, such as the aforementioned licence art.23 WOB.

Roadmap for Dutch companies: what is needed?

To help Dutch companies, several websites write about roadmaps and things you need to have arranged before the Brexit. Below are the main points of the websites www.Hulpbijbrexit.nl, Dutch Customs and in particular for transport via Dutch ports the site www.getreadyforbrexit.eu in a row:

Step 1: Is it necessary?
Check whether your company trades with the UK or transports goods through the UK. If the answer is yes, also check whether your company is ready to continue trading with the UK in terms of staff, technical capacity and customs permits. For example, contact your suppliers and carriers as the Brexit may also affect your supply chain.
Step 2: Make your company known to Customs
Do you not yet have a relationship or experience with Customs? Then apply for an EORI number as soon as possible. Every company in Europe that exports or imports needs such a unique identification number. Even if you leave your import and/or export declarations to a forwarding agent or customs broker. You can find the contact details of the national customs authorities in that list.
Step 3: Determine who will make the import or export declarations
As an importer or exporter, it is important that you decide whether you want to file import and/or export declarations with Customs yourself or whether you want to use a forwarding agent or customs broker. If you are already filing declarations yourself, now is a good time to check whether additional Customs regulations or licences apply to you. Think for example of simplifications for placing goods under a customs procedure.

Do you trade in goods that may be subject to inspection? Then request information yourself or through your customs agent and, where necessary, arrange for the correct certificates with the NVWA and the ILT.
Step 4: Agree who will handle the customs documents and pre-notify
After the Brexit, the pre-notification of customs documents is mandatory at all Dutch ferry terminals and most shortsea terminals. This can be done by the importer/exporter, but also by the freight forwarder, customs agent or, occasionally, the carrier. It is very important to agree this properly in advance, because without advance notification the carrier will not be granted access to the terminal. And that causes delays! Please check the site www.getreadyforbrexit.eu for more information.
Step 5: check in advance whether the terminal has the customs document
Only digitally pre-announced cargo can enter and exit the terminal, otherwise the container or trailer will come to a standstill here. So always check the customs status at the terminal in advance, or have your forwarder or agent do so. Without a pre-notified document, no transport, and that results in delays.