Government research shows that the majority of businesses that solely export to the EU are unprepared for a no-deal Brexit. While we still don’t know exactly what Brexit will mean for businesses, or even when it will happen, your own company can’t afford to be in the same boat once the UK leaves the EU.
If this does come to pass, the way your business sells goods within the EU will change overnight. The customs procedures you currently use will become redundant and you may instead find yourself trading under World Trade Organisation (WTO) rules. And unless your business complies with these regulations, you’ll almost certainly be prevented from exporting to EU countries at all. Follow the steps below to ensure you can still trade overseas post-Brexit.
1. Check the procedures for particular types of products
Depending on the goods you produce, and the countries you trade with, you could be required to apply for a licence to export your products. This bracket includes agricultural products, artwork, and medical devices, as well as excise goods (such as alcohol, tobacco, and certain oils) and controlled goods (like military items and firearms). For instance, animal products for human consumption need a commercial document that includes information about the consignment’s content and your contact details.
Make sure to check whether your own products will be subject to such procedures, as well as the regulations of the different countries with which you will be trading. This will allow you to make any necessary adjustments in order to ensure your compliance.
2. Ensure you have the right product documentation
Non-tariff barriers, like incorrect product documentation, can be an even greater hindrance to trade than the tariffs themselves. While UK and EU standards and regulations are currently aligned, they may not be after Brexit. Consequently, you should verify whether your paperwork meets the standards and labelling requirements of the countries you export to, as well as general EU regulations. For instance, you probably won’t be able to use the EU Organics logo on food products after Brexit.
However, there are plenty of technological solutions that can help streamline this process. Take SAP S/4HANA’s Product Compliance feature, which includes integrated checks and processes for a business’s products. For instance, its automated label printing function will help you avoid a lot of the rigmarole involved.
3. Make sure that you have an EORI number
An Economic Operator Registration and Identification (EORI) number identifies individual importers and exporters, tracking trade between EU and non-EU countries. You or your freight agent will use this when making customs declarations for goods crossing EU borders. Without an EORI number, these goods simply won’t be allowed through.
HMRC sent EORI numbers to all VAT registered businesses in August 2019, so you should have one already, and those with EORI numbers from other EU member states can continue using them for now. If you’re unsure whether you have one or not, it’s worth contacting the HMRC EORI teambe on the safe side. Should you not have a number for whatever reason, you can apply for one through the UK Government website, and should receive it within a few days
4. Decide how to export your goods
Using the Common Transit Convention makes it quicker and simpler to export your goods as you can bypass some custom declarations, only pay custom duties at the final destination, and complete some customs procedures away from the border.
To use the convention, you’ll need to have an EORI number, provide a guarantee to cover these goods in transit, and make an export declaration. In order to make export declarations, you must register for the New Computer Transit System. You’ll then need to decide whether you want to deal with customs yourself, or hire a customs agent, broker, or freight forwarder to do so on your behalf. For the latter option, you’ll have to provide written permission.