Substantial simplifications planned for EU/UK trade in the event of ‘no deal’

This week, HRMC has written to 145,000 UK VAT-registered businesses trading with the EU about the transitional simplified procedures (TSP) for customs, in the event of a no deal scenario.

Chambers of Commerce welcome the introduction of the TSP arrangements as a means of avoiding prolonged checks at the border and gridlock on the motorways in the event of a no deal Brexit, but businesses need to be alert to the new requirements.

This is government planning for every eventuality, including a no deal scenario. Businesses are being advised that they should be similarly prepared for leaving the EU.

Once businesses are registered for TSP, they will be able to transport goods from the EU into the UK without having to make a full customs declaration at the border and will be able to postpone paying any import duties.

These simplifications will be available for an undefined time period, but 12 months’ notice will be given if  changes are being made by government. This announcement is a part of a series to ease the flow of goods in a no-deal scenario.

In summary:

EORI number

HMRC is reminding businesses to get an economic operator registration and identification (EORI) number if they do not already have one. Traders should be encouraged to apply as soon as possible. This number is crucial to be able to trade after Brexit in the event of no deal. Obtaining an EORI number can be done online and takes ten minutes.

Transitional Simplified Procedures (TSP)

Businesses can register for TSP if they have an EORI number, are established in the UK, and are importing goods from the EU into the UK. Registration for TSP opens on 7 February. 

Customs declarations and pre-notifications will still be required, but various simplifications are available to avoid congestion. Traders will be able to lodge them ahead of goods arriving at the border or into company’s records.

The initial declaration should be submitted in the company’s own commercial records, and once the goods arrive in the UK a supplementary declaration is lodged.

Transitional arrangements are very similar to the two existing customs procedures Customs Freight Simplified Procedures (CFSP) and Entry in Declarants Records (EIDR). Brokers will able to use own CFSP authorisations without being jointly liable for customs duties. Unlike now, this simplification available for all trade, not only EU/UK.

Relaxation of comprehensive guarantee requirement

A simpler version of the guarantee will be available for all traders, without the need to meet the current CCG requirements. Sufficient time should be given to provide a guarantee.

As is currently the case, anti-smuggling (Border Force) checks will take place at the border on selected shipments, based on risk-analysis. Even goods from other EU countries currently undergo these checks.

Special simplifications for customs formalities also for traders of controlled goods (requiring a licence or a certificate).

These simplifications take account of Chamber members feedback and addresses challenges currently faced by companies. The simplifications are based on existing forms and procedures so in principle should be feasible as not dependent on new IT or forms to be ready on time. Basically, this is an extension and simplification of what’s already available.

These are UK customs simplifications, so they don’t cover all UK border checks, nor checks required by the destination country.

Conclusion

The BCC has been engaging extensively with HMRC over recent months to suggest ways to minimise the disruption to trade in the event of no deal – based on feedback from Chambers and members across the Network – so we are pleased that this has been reflected in the new guidance. We will continue to update our Brexit Risk Register and Business Checklist as information from government becomes available.

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