Everything you need to know about exporting to the UK after Brexit
2021 is drawing to a close. We’re almost a year after Brexit, and it’s safe to say a lot has happened since the process began. A growing number of companies are getting used to the new situation and can trade between the European Union and the United Kingdom, but many still do not have a clear idea of what they need to do to make these efforts successful. of success.
Frank Weermeijer, Group CEO at Customs assistance, identifies three key elements that businesses should be aware of when exporting to the UK.
Know your flow
We saw in the first few months of Brexit, and what we still see is that many companies do not have a complete view of their supply chain when it comes to the origin of goods. The origin is essential because it determines, for example, the import duties that must be paid. The origin also determines the documents you must submit to import or export your goods.
In particular, companies that were used to doing business only within the EU face this problem. Suddenly they have to prove the origin of their goods when exporting to the UK. And there is another problem: import duties.
For example, let’s say you are an EU based business exporting to customers in the UK. If you buy certain goods in the USA and sell them in the UK, the import duty must be paid twice, first when you import it into the EU and then again when you import it UK.
The solution for this is to set up or use a bonded warehouse to store the goods you import from outside the European Union. When your goods are stored in a bonded warehouse, you don’t have to pay import duties… yet. You only need to pay the import duty when you import it into the European Union. When you sell to a customer in the UK you only pay the import duty there.
Come to an agreement
Businesses need to review the Incoterms under which they sell to customers in the UK. Two Incoterms can cause problems: Ex Works and Delivered Duty Paid.
If you are selling Ex Works to a company in the UK, you do not have to deal with customs yourself. But you can be a big challenge for your UK customers. They must be established in the European Union in order to be able to conclude an agreement with a customs broker for direct representation. Most customs brokers are unwilling to issue customs documents without a direct representation agreement.
If you are selling Delivered Duty Paid, you will encounter a similar problem as your UK customers with Ex Works, only the issues will occur in UK. You will need to be registered in the UK to be able to enter into a direct representation agreement.
We advise companies in the EU to no longer use Ex Works or Delivery Duty Paid when trading between the European Union and the United Kingdom, if they are not registered in this country.
Companies that export or import from countries like China or the United States are used to having their goods on a ship for weeks. This leaves plenty of time to organize the documentation needed to import the goods once they arrive.
Companies that export to the UK don’t have this luxury. The distance between the EU and the UK is so short that there is no time to create additional documents. You must have all the documents in order before the goods leave the European Union.
Ask an expert
Customs rules and regulations can sometimes be complex, while non-compliance can result in delays or even fines. Whether it’s determining the origin of your goods, the classification of your goods, or getting the right documents and permits, make sure you know what you’re doing. If in doubt, contact a customs specialist. They have in-depth knowledge and experience and can help you import and export a shipment without any hassle. Let them relieve you.