Brexit is the name given to the Great Britains withdrawal from the European Union. Following a public vote in 2016, Great Britain formally left the European Union on 31 January 2020. This was accompanied by a transition period until 1 January 2021. This exit has a variety of implications for politics, economics and logistics.
In this article, we discuss the impact of Brexit on the logistics industry, provide information about new customs regulations and list which documents are necessary for importing and exporting to the Great Britain. We then show how Röhlig ensures a smooth process when importing and exporting goods to and from the Great Britain.
How does the Brexit affect logistics?
Before Brexit, goods could be transported from one EU country to another without any problems. No customs duties were levied at the borders between the UK and the EU. As a result, there were virtually no customs costs and delays in the supply chain were minimal.
On 1 January 2021, Great Britain left the EU customs union and VAT area. To move goods between the EU and Great Britain, full import and export documentation has been required since then.
The new customs regulations after Brexit initially led to delays
At the turn of the year 2020 - 2021, there were long truck jams at several ports on the south coast of England and near the northern French town of Calais. The reason for this was, in addition to a reduced number of ferries for the crossing to the island, the additional control effort of the administrative formalities for customs and security declarations, which have been necessary since the final exit of the British from the EU.
Many logistics companies complained about long standstill times for their drivers and large losses of time.
Customs declaration becomes necessary after Brexit
With Great Britains exit from the EU single market and customs union, all freight transported between the EU and Great Britain will have to be formally declared and checked with customs and other relevant authorities. Shipments to and from Great Britain are now considered international imports and exports.
It is essential that customs documents comply with the correct classification of goods, being complete and unambiguous. Delays in clearance, such as those that occurred in southern English ports in January 2021, are mainly due to the inadequate or incorrect declaration of goods. Groupage consignments, where several different goods with different shippers are transported in one truck, often run the risk of causing long waiting times. As soon as one of the containing consignments is insufficiently or incorrectly declared, the truck gets stuck at the border.
Recommendations for companies shipping goods to and from the Great Britain after Brexit
To ensure the submission of complete and compliant declarations when importing or exporting to the UK, a comprehensive knowledge of the regulations and requirements is necessary. Company staff who previously managed the flow of goods between the UK and the EU must now acquire new expertise in post-Brexit requirements and have a broad knowledge of new requirements. Therefore, they face an even higher level of responsibility.
After the end of the transition period, the UK government therefore recommends using either a customs broker or a logistics service provider to manage the complex process.
The delayed import declaration with "Customs Freight Simplified Procedure" (CFSP)
To promote trade, the Great Britain government has developed an electronic customs declaration. The Customs Freight Simplified Procedure (CFSP) allows standard goods to cross the Great Britain border when the trader makes an initial declaration (Simplified Frontier Declaration). The details of the shipment are sent to HMRC (Her Majesty's Revenue and Customs). To use the CFSP, the business or trader must be authorised by HMRC. Goods imported under the CFSP will still be treated in the same way as goods under the normal procedures. However, this procedure makes the data transmission for transit documentation and submission to HMRC simpler and quicker. After this simplified declaration, the complete tax and statistical data must be submitted in a supplementary declaration within a certain period of time.
Röhlig UK Ltd. is certified to use the CFSP and helps with a smooth process when importing or exporting goods to the Great Britain.
Exports to the UK after Brexit only with export declaration
With Brexit, the United Kingdom has left the Single Market and the Customs Union. Transports are therefore no longer considered an intra-Community supply and are treated as exports to a third country. Therefore, a customs export declaration is required for each consignment of goods to be exported to Great Britain.
In order to make the movement of goods between the EU and Great Britain as smooth as possible, we recommend that companies have the documents listed below ready when they receive their order. In this way, unwanted delays can be avoided and planned supply chains can be maintained.
How preferential tariffs and zero tariffs are regulated after Brexit
In addition to the documents listed below, documentation of the relevant rules of origin of the goods is particularly important. If the goods satisfy the Rules of Origin (RoO for short), zero tariffs and zero quotas apply to both EU and Great Britain imports. In such a case, the tariffs are preferential. In contrast to standard tariffs, which apply to imports of goods from a third country, these represent preferential treatment. But it is worth taking a closer look here. Duty-free in this context does not mean "free of formalities", because the so-called preferential duty rate can only be claimed if the goods are "originating" and this is documented and verifiable in detail. It should also be noted that every exporter can issue a declaration of origin if the value of the goods does not exceed 6,000 euros. As soon as the value of the goods is higher, the EU exporter must be a registered exporter (REX).
The import VAT regime for consignments with a low value of goods
No duties or import taxes are levied on the export of all commercial consignments from a third country such as Great Britain to consignees in the customs territory of the European Union whose value of goods does not exceed €22. Shipments with a value of goods between €22 and €150 are not subject to customs duties, but they are subject to import VAT. The material value of the goods is decisive for determining the value of the goods. In the case of goods for commercial purposes, the material value corresponds to the price of the goods excluding transport and insurance costs. However, if these costs are included in the price and cannot be stated, they remain in the material value.
|POWER OF ATTORNEY LETTER/ LETTER OF EMPOWERMENT||only needs to be completed once to authorise Röhlig to act as direct representative in completing customs declarations.|
|EORI NUMBERS OF EXPORTER AND IMPORTER||
The EORI number (Economic Operators Registration and Identification) is a requirement for customs clearance of goods in the European Union and the UK. |
- The EORI number is applied for at national customs directorates.
- It contains all contact details for the identification of the trader.
- Information for a UK-based company - Information for a company based in the EU
- For imports into or exports from the UK, companies need a "GB EORI number". This can be applied for in the link.
If the Export Accompanying Declaration (EAD) is prepared independently, indicate the Movement Reference Number (MRN) of the EAD in the transport order and hand over the EAD to the driver. |
- From 1 January 2021 also required for goods values below EUR 1,000.
The electronic copy of the commercial invoice must be available. Customs duties and VAT are calculated on the basis of the value of the goods and the currency.|
- Attach the exporter's EORI and for goods destined for the UK, the importer's EORI.
- To benefit from customs relief, the declaration of origin (incl. REX number of the registered exporter if the value of the goods exceeds € 6,000) must be attached.
|CUSTOMS TARIFF NUMBER OF GOODS (HS CODES)||- Harmonised classification code of the list of customs tariff numbers of goods (HS codes).||https://www.trade.gov/harmonized-system-hs-codes|
|DESCRIPTION OF GOODS||
- In the national language allowing correct HS classification.|
- Gross/net weight and number/type of packaging.
|UK IMPORT PROCEDURE: FULL DECLARATION OR CFSP EASEMENT||
Border Operating Model outlines UK import options that must be confirmed and initiated prior to EU export.|
- Inform Röhlig whether Great Britain import will use CFSP facilitation (importer's EORI is sufficient for UK entry) or full import declaration (import declaration entry number "ENO" required for Great Britain entry).
- If Röhlig is not commissioned to prepare the full import declaration, state the ENO in the transport order.
The impact of Brexit on the validity of Incoterms
After Brexit, different Incoterms will be required between Great Britain contractors and EU customers and suppliers. Incoterms need to be agreed between business partners in advance to clarify who is responsible for customs clearance and associated costs. Terms such as Delivered Duty Paid (DDP) now become Delivered At Place (DAP). This is because the transport of goods from Great Britain to and from the EU after Brexit is now considered international. As a result, import formalities must be handled in the country where the goods are received. That is also where your liability ends. If you want or need to continue using DDP for liability purposes, you will need an EU EORI number in addition to your UK EORI number.
How we can help you after Brexit
The changes that Brexit will bring to importing and exporting to Great Britain seem complex to many. Customs can therefore become a challenge. Whether you are a client from Great Britain or want to ship from the EU to Great Britain, with Röhlig you gain an experienced logistics company that knows all about Brexit and will guide you through the new processes.
Our extensive network of over 2,200 employees worldwide will deliver your goods to and from Great Britain from any country in the world. All three branches of Röhlig UK offer customs clearance services and can clear imports and exports at all Great Britain ports and airports. While we keep up to date with regulatory procedures, our team is on hand to help you navigate the complexities of customs compliance and help you manage your Great Britain import and export procedures.
Our summary of the impact of Brexit on the logistics industry
The consequences of Brexit are not only felt in the form of new customs regulations. Many companies are thinking about restructuring their supply chains due to Great Britains exit from the EU. Flexibility, reliability and speed have become more important than ever for effective value chains. Supply chains are expected to adapt to the new conditions of Brexit. How this will happen will become clear in the coming months and years.
The processes for importing and exporting to Great Britain have become more complex post-Brexit. A wide range of experience and knowledge will be required of all parties involved. As a business, understanding the guidelines around importing and exporting to and from the EU from Great Britain is crucial to minimising your costs and making the movement of your goods as smooth as possible. More businesses are expected to outsource their logistics activities. To find out how you as a company can find a suitable 3PL partner for your business, please read this blog article.
Röhlig supports you with tailor-made solutions, excellent customer service and digital solutions to keep your supply chains running smoothly after Brexit.
DISCLAIMER - All information is provided in good faith for guidance and reference purposes only. It is of a general informational nature, and Röhlig Logistics GmbH & Co. KG takes no legal responsibility for the accuracy of the information provided via this document. Röhlig Logistics GmbH & Co. KG makes no representation as to the accuracy or completeness of any of the information contained herein and accepts no liability for any loss arising from the use of the information provided.