A logistics industry expert has set out urgent practical steps businesses trading with the EU should take to minimise problems they could face after a no-deal Brexit.
David Johnson (pictured above), managing director of Leeds-based Tudor International Freight, said with less than 200 days until the UK leaves the EU, affected importers and exporters broadly needed to bring their processes and documentation for trading with the bloc into line with those applying to nations elsewhere now.
He said: “The possibility of no withdrawal agreement being concluded in the talks involving the EU and UK seems to have risen sharply up the list of possible outcomes in recent weeks. If this happens, the free circulation of goods between the two will cease in March 2019 and there’ll be immediate changes to importing and exporting procedures, as the envisaged 20-month transition period won’t apply.”
Johnson said these amendments would almost certainly include tariffs being imposed, import and export declarations being required, customs checks taking place and any VAT and customs duties due having to be paid.
He said: “There are several steps affected businesses should take now that could help reduce shipping delays and other problems they may encounter after a no-deal result.
“These include ensuring comprehensive CMR notes are used for all consignments transported by road to and from the EU. Such documents should contain detailed and precise content concerning shippers and consignees, for example.”
A CMR note – the abbreviation being derived from its French name – is the standard contract for transporting goods internationally by road. Containing a set of terms and conditions, and therefore making it unnecessary for individual businesses to devise their own, it is a consignment note confirming the carrier has received the goods and has a transportation contract with its customer.
Johnson added: “We’d also advise traders with the EU to ensure they now prepare full and accurate commercial invoices.
“It’s important that all descriptions of goods are sufficient for the appropriate customs commodity codes to be identified and applied. These classify items for import and export, so businesses can complete declarations and other paperwork correctly, check if there’s any duty or VAT to pay, and discover whether any duty reliefs apply, for instance.”
Johnson said that, in addition to taking actions such as these themselves, affected enterprises should now be talking with other companies in their supply chains, to ensure any preparations needed for a no-deal outcome were in progress there too.
He added: “We’d also advise relevant traders to start considering how they’ll handle important tasks likely to become necessary later if no deal is agreed. These include whether they should enlist specialist support from organisations like ourselves for submitting customs declarations or assisting with documentation checks.”
Johnson said that when seeking assistance from international freight forwarders, traders should remember the few hundred in the UK who were Authorised Economic Operators could offer them advantages unavailable elsewhere. These included a faster application process for customs authorisations and a reduction in the level of financial guarantees required.
He concluded: “Effective contingency planning involves preparing for the worst-case scenario and we’d therefore urge affected businesses to seek advice where necessary and take the steps we’ve outlined now, so they’re protected to the greatest extent possible from the adverse consequences of a no-deal Brexit.”
Importing goods: Current requirements
The processes that would apply to goods being moved to or from the EU following a no- deal Brexit would contrast sharply with the much less onerous procedures applying today. When a trader currently imports goods from the EU on a client’s behalf, for example, the only documentation it needs is a copy of the packing list or commercial invoice and the travel document. This is a waybill for air freight, a bill of lading for sea consignments and a CMR note for road haulage. No customs clearance processes or duties apply, and no VAT is payable before goods can be moved from receiving ports or airports.
Posted on: September 28th 2018