The EU is the UK’s single biggest export market, accounting for 46% of all UK exports and valued at £289 billion. In the scenario of no deal, the legal relationship of the UK to the EU will be that of a “third country”, meaning the process for exporting goods to the EU will fundamentally change.
Key challenges for business
How will the rules for exporting to the EU change after no deal?
Exporting to the EU for UK businesses will change immediately after no deal. Overnight, the UK will be regarded as a third country by the EU, and tariffs will be applying on most UK exports, all UK exports will have to undertake customs procedures and many regulated goods will need to have additional licenses or go through additional procedures.
There are only a very few temporary measures in place that will ease the flow of goods to the EU – so the changes on Day 1 will be the changes businesses will have to contend within until and if a deal is struck.
What impact could the changes to exporting rules have on business?
For businesses, the combination of tariffs, customs procedures and regulatory change creates both additional burdens and costs. The imposition of EU tariffs will mean that some businesses will face challenges in offering competitive pricing to their EU customers. The additional customs checks at the EU border have the potential to cause delays at ports if processes fail or are not followed correctly by transporters. These delays will have knock on impacts on supply chains – and are difficult for perishable products in particular, with all products of animal origins and plants having to enter the EU via a point of entry with a Border Inspection Post.
How will exporting work across the Republic of Ireland/Northern Irish border?
The Withdrawal Agreement included the Northern Ireland protocol, aimed at avoiding a hard border on the island of Ireland in the event of no deal. It means that, while Northern Ireland will remain part of the customs territory of the UK, customs checks and controls will apply for goods moving from Great Britain to Northern Ireland. That ensures no customs checks or controls are required between Northern Ireland and the Republic.
It also includes the creation of zone of regulatory compliance, in which Northern Ireland will follow EU rules for manufactured goods and agri-food.
A Joint Committee will decide on detailed criteria for what goods are “at risk” of being shipped on to the EU and will therefore have to pay the EU tariff. The definition of “at risk”, which will be agreed during the transition, will determine the volume of GB–NI trade where checks are required.The Irish government has produced a range of programmes and funds to support preparedness which Northern Irish firms may consider going through with their customers. Information about how to pay import duty and submit customs declarations can be found on the Irish Tax and Customs website.
Key questions for business to consider
Continuity plans for no deal will be unique to every organisation. However, there are some key questions your plan should answer, to ensure the major issues are covered.
- Do you know how important goods exports to the EU are to your business?
- Do you know your GB Economic Operator Registration and Identification (EORI) number?
- Have you considered whether transporting using the Common Transit Convention (CTC) rules will benefit your business?
- Have you checked if the importers you work with has an EU EORI number? You'll need to get an EU EORI number if you're exporting to your own business within the EU. You can get one from the customs authority in any EU country.
- Does your business understand the impact of potential delays at the border on your customers, particularly if you export perishable goods, are part of a just-in-time supply chain or commit to same day or next day delivery?
- Have you considered extending your promised delivery deadlines in case of a no deal to account for delays?
- Have you thought about moving forwards or pushing back your scheduled delivery dates to avoid the no deal deadline?
- Have you spoken to your customs broker, freight forwarder or logistics provider about how to make customs declarations, or explored engaging one?Have you familiarised yourself with VAT rules for exporting to the EU and considered any cash flow implications?
- Have you checked what you need for the types of goods you export? There may be specific licences or rules for certain goods.
- Have you considered how the EU’s external tariff schedule may impact the goods that you export?
Want the highlights? View our webcast
Preparing for no deal: changes for exporting goods
Want the deep dive?
Other resources to help you plan
Explore the government’s advice for getting ready to export here and specific advice on bringing goods through roll-on-roll-off ports like Dover and the Channel Tunnel here and from French customs here.
In particular, make sure you know which customs authorisations you will need here.
Look into your Economic Operator Registration and Identification (EORI) number here. This will make it easier to move goods into or out of the EU in a no deal scenario.
Read this mythbuster on EORI for more information.
If your goods cross into the Republic of Ireland from Northern Ireland, read the Irish government’s Brexit Contingency Action Plan here.
Find out how to claim VAT refunds from EU countries after Brexit here.
Work out what tariffs your goods could face through the EU Trade Helpdesk here.
If you make use of trailers when crossing the border into the EU, check out the government’s guidance here.
If you import or export chemicals, meat, dairy or live animals, see these process flowcharts here.
If you import or export to or from the EU using roll on roll off (RoRo) ports, see these flowcharts here.
If you need further support, there is a new government Imports and Exports helpline. The number is 0300 3301 331 and lines are open Monday to Friday, 8am to 6pm.
How are other businesses preparing?
— Manufacturer, West Midlands
As we export 25% of our goods to the EU, we tried to protect our customers there in the lead up to the previous cliff edge in March by stockpiling in Germany. As this did not happen in the end, that effectively became a waste of money and resources and we had to run down our stock – but now we to have to buy up stock again in preparation for the October deadline