What’s the future for UK's trade with the EU and the World?
Until December 2020 UK companies can trade with the EU and use EU’s negotiated 40 free trade deals covering more than 70 countries without reference to the World Trade Organisation’s terms (WTO). From 1st January 2021 the UK need to negotiate a free trade deal with the EU and replicate EU’s 40 free trade deals country by country in order to avoid WTO tariffs and other trade barriers.
New trade deals
So far, the UK has signed 20 deals covering 50 countries/territories representing around 8% of UK’s total trade and include; Andean countries, Caribbean countries, Central America, Chile, Eastern and South Africa, Faroe Islands, Georgia, Iceland, Israel, Jordan, Kosovo, Lebanon, Liechtenstein, Morocco, Norway, Pacific Islands, Palestinian authorities, South Korea, Southern African nations, Switzerland and Tunisia.
In addition to these trade deals the UK has signed “Mutual Recognition Agreements” with USA, Australia and New Zealand. These agreements recognise product and labelling standards etc but are no free trade agreements. So much more work needs to be done by the government before the end of 2020 to facilitate future UK trade.
We are leaving
It is now clear the UK will leave the Single Market and Customs Union on the 31st December 2020, so everyone who is trading with the EU should use the Transition period to prepare for new trade regulations and possible tariffs. As from 1st January 2021 all goods transported between the UK and EU over the various routes and transport methods like Ro/Ro, Eurotunnel, Road, Rail, Truck, Containerised Cargo, Sea Freight and Air Freight including Courier parcels will be subject to additional customs border checks and customs clearance declarations and applicable Phytosanitary, CVED’s and Licences.
We can help you
Telephone advice & consultancy available - we can help you understand how to continue Trading with Europe using the new Customs formalities.
If you are trading with the EU you need to take action and prepare for 1st January 2021. It is also important to remember that even if the UK and the EU agree a free trade deal the UK is set to leaving the Single Market and the Customs Union, which means all goods transported between the UK and EU will be subject to customs clearance formalities.
What you need to do now
Keep up to date
Have You Got an EORI Number
- Make sure you have your Economic Operator Registration and Identification (EORI) number. If you don’t have an EORI number (Economic Operator Registration and Identification) number you should apply for one now! You need the EORI number to Customs clear your goods when you import or export after 1st January 2021.
It will only take a few days and is free. Apply at: www.gov.uk/eori
Do You Know Your Commodity Code
You need to establish the Commodity Codes for your goods. You will need these codes to Customs clear your goods and to apply the correct amount of DUTY.
Check your Commodity code at: www.gov.uk/trade-tariff
Do You Know Your INCOTERMS
- You need to establish your Incoterms (International Commercial Terms), which define the responsibilities of sellers and buyers for the delivery of goods under sales contracts. The terms are published by the International Chamber of Commerce (ICC).
Check your INCO terms at: https://iccwbo.org/resources-for-business/incoterms-rules/incoterms- rules-2010/
and at ICC Store at: https://library.iccwbo.org/clp/clp-incoterms.htm
Do You Have The Right Documentation
You need to be ready to provide the following commercial documentation and information for each shipment.
Commercial Invoice incl. Sales Value and Currency for the Goods - Incoterms
County of Origin of the Cargo – this may be different to the country the goods are consigned from.
Commodity Code and Tariff Number
Health or Phyto Certs
Transitional Simplified Procedures (TSP)
- Please note registration and use of Transitional Simplified Procedures (TSP) for imports from the EU is currently suspended. You cannot use TSP during the Transition Period, 1st February to 31st December 2020. If you have applied for this service, please keep your paperwork safe. In addition, postponed VAT accounting is also not available during the Transition period.
If in doubt or have any questions please talk to RJJ, we will assist you and clarify what you need to do.
RJJ is AEO (Authorised Economic Operator) accredited by HMRC and therefore experienced and approved as a “Trusted Trader” by HMRC.
For more information please contact a member of the RJJ team:
Phone: +44 (0)1394 673466 Email: [email protected]