What is going to happen post Brexit?
The future trade relationship between the UK and EU after 31st December 2020 depends on the outcome of the current negotiations. There are currently two likely scenarios that UK-EU will be traded under from 1st January 2021.
- A Free Trade Agreement (FTA): The UK and EU are aiming to conclude an FTA by the end of the transition period. The details of this are still unknown but it is likely that an FTA would mean, broadly, that tariffs and quotas would not be applied on the majority of goods traded between the UK and EU. There could be some exemptions to this, however, and an FTA is unlikely to eliminate all customs checks so additional paperwork and other formalities could still be required.
- WTO terms: If an FTA cannot be agreed by the end of the transition period, the UK and the EU will trade on World Trade Organisation (WTO) terms. Shipments will be subject to customs clearance and inspections, while tariffs are expected to be imposed on goods that the UK sends to EU countries and on goods EU countries send to the UK.
Existing UK trade agreements with non-EU countries
Agreements with certain countries and trading blocks are expected to take effect when existing EU trade agreements no longer apply to the UK. These include Canada, Central America, Israel and Switzerland. See the full list here.
The UK has also signed a free trade agreement with Japan. Find out more.
There are ongoing discussions with other countries where there are existing EU trade agreements in place. These include Albania, Mexico and Turkey. See the full list here.
Mutual recognition agreements (MRA)
The UK has signed MRAs that replicate existing EU agreements with Australia, New Zealand and the United States of America. These are expected to take effect from 1st January 2021.
How are you preparing for potential supply chain delays?
We have increased our stock holding of key components and continue to work closely with our suppliers and freight forwarders to mitigate risks as far as we can.
Do you expect any disruption in international shipments of your products over the next couple of months?
It is unclear what disruption there will be, but in anticipation we have asked our customers wherever possible to avoid asking for shipments in the last two weeks of December and first week of January 2021.
Can you supply Country of Origin information for your products?
We are currently compiling a list of Country of Origin data which we will publish on this web page shortly. In the meantime, we will supply this information on commercial invoices.
What are Incoterms and are they important?
The Incoterms rules or International Commercial Terms are a series of pre-defined commercial terms widely used in international commercial transactions. These include:
- Where the goods will be delivered
- Who arranges and pays for the transport
- Who is responsible for insuring the goods
- Who pays the insurance premium
- Who handles customs procedures and who pays duties and taxes
If a trade deal hasn’t been agreed by the end of the transition period, Incoterms will be an important piece of information on the commercial invoices that will need to accompany shipments. These may also be needed if a trade deal is implemented, depending on the terms of the agreement.
What Incoterms will Advanced trade on after 1st January 2021?
To give the best possible service and flexibility to our customers, we will be shipping using Ex Works Incoterms where you wish to arrange your own carriage, and FCA (Free Carrier) Incoterms where you wish Advanced to arrange carriage. The guide below shows further details on FCA.
What will the impact of FCA terms be on couriers and delivery?
Our incoterms and logistical arrangements remain unchanged. FCA allows the flexibility for you to arrange to collect goods from our premises, or for us to arrange delivery to you or any delivery address that you require.
In the event of a no deal outcome, the only change will be the addition of taxes and duties to be paid, based on WTO rates. If you have a deferment account you will need to provide this information to your freight forwarder, courier or clearing agent (if you have one) and they will complete the clearance for you.
If you do not have a deferment account they will advise you how this payment can be made going forward.
What are the commodity codes for your products?
All products we supply will carry the commodity code: 8531 1030 00.
Are you registered as an entity within the EU?
Yes, although the trade talks are still in progress, we believe that we will need to have an Authorised Representative based within the EU. To address this, we are being supported by our parent company Halma, who have created an entity for those companies within the group who do not have a current EU based location. The address is:
Halma Europe DS BV, J. Keplerweg 14, 2408AC, Alphen aan Den Rijn, Netherlands
Have you already in place or plan to have the resources and administration/customs intermediary in place by 31/12/2020 to issue customs declarations and invoices for exporting outside of the UK?
Advanced already ship our products globally and therefore our export shipping team are fully trained and experienced in all aspects of international logistics, additionally we have full support from our freight forwarders and courier company to assist with customs clearance and documentation. We are anticipating some challenges in this area of course.
Can you confirm that all products supplied will be correctly labelled and marked under EU Law?
Yes, over the past few years Advanced has worked hard to ensure the products are certified by EU based notified bodies. All products supplied will carry the correct certification and labelling to meet EU regulations and are now certified by European notified bodies.
Where can I find Declaration of Performance certificates?
You can find these on our website under ‘Approvals’ here.
Will it differ for Northern Ireland?
We believe that an XI EORI number will be submitted by mid December. For further information and support around shipping in and out of Northern Ireland please refer to the government website www.tradersupportservice.co.uk/tss and also www.nicustomstradeacademy.co.uk
Will there be a UK equivalent of the EUR1 form?
There is an assumption that there will be a UK equivalent after 1st January 2021 but there has not been any confirmation yet. We will update this page as and when we know more.
Will a commercial invoice be required?
If a Free Trade Agreement cannot be agreed within the transition period, goods traded between the UK and the EU will be subject to the same requirements as non-EU country goods under the World Trade Organisation (WTO) rules.
Every shipment will need a commercial invoice with information for customs authorities. This helps the authorities assess if the goods can move in or out of a country and what, if any, controls are needed. It also helps the authorities determine duties and taxes. It is vital to supply an invoice with the right information as it reduces the potential for delay.
Commercial invoices may also be required if a Free Trade Agreement is implemented, depending on the terms of the agreement.
The Advanced export shipping team are fully trained and experienced in producing commercial invoices where required. Further information on commercial invoices is available here.
What needs to be included on the commercial invoice?
Our commercial invoice will include the HS Code, the description of the goods, the value and the country of origin.
What is an HS code and is it important?
The Harmonized System (HS Code) is a list of numbers used to classify a product for tax and duties and any necessary restrictions, and consists of at least 6 digits. When you have classified your goods, customs authorities all over the world are able to identify the contents of your package. The system is used by more than 200 countries and covers 98% of traded goods.
You can classify your goods on your country’s Government website. You can also use an online HS code search – just type in a detailed goods description and you’ll get your code. If you don’t include the HS code on the commercial invoice and other shipping documents, it could delay the shipment and you risk the receiver paying the incorrect duties and VAT. You can find further information here.
What is a BTI?
Binding Tariff Information (BTI) is a tool created by the European Community to assist economic operators to obtain the correct tariff classification for goods they intend to import or export. Binding Tariff Information is issued on request by the customs authorities of the Member States. It is valid throughout the European Community.
Do you have BTIs or any other European Tax Authority?
We do not have any BTIs. We use our HS code is 8531 1030 00.
What is an EORI number and is it essential?
An Economic Operator Registration and Identification number (EORI) is a European Union requirement for businesses which import or export goods to and from the EU.
If you currently trade outside of the EU, you will already have an EORI number. If you only trade within the EU, you will need to register. If the UK and EU don’t agree an FTA, then to trade between the UK and EU both shipper and receiver will need to be EORI registered in their own respective countries. This may also be the case if an FTA is implemented, depending on the terms of the agreement. If you are shipping from the UK to Germany for example, you will need to register with the UK authorities. Your receiver will need to register with the German authorities.
EU EORI numbers will not be recognised in the UK.
UK EORI numbers will not be recognised in the EU.
We advise all customers to register for an EORI in your own country as soon as possible. It only takes 10 minutes to apply. Applications can be made through your country’s government website. UK businesses can register here.
What is Advanced’s EORI number?
GB 733 8363 23000
Will I need to pay taxes and duties?
Duties and taxes are likely to be charged at the point of import into the UK or the EU. The person or business receiving the shipment is legally obliged to pay duty unless the sender has agreed to accept these charges in the contract of sale (this will be shown by the Incoterm ® used). It is important that you understand any potential import tax and duty you may have to pay, which will be dependent on your HS code and the output of negotiations.
Do I need an import license?
You should check your local government rules to see if this is required.
What is a deferment account and do I need one?
A deferment account is an account authorised by your local customs office through which your payable duties can be paid directly to the authorities for a certain accounting period on a predetermined due date. Deferment accounts are not compulsory, but can be cost-effective and help ensure quick customs clearance as duties are paid in full at the time of import.
More information can be found on individual country government websites. UK businesses can find more information here.
Where can I find additional information?
Please see the FedEx website here, which contains a lot of useful information: FedEx.com/Brexit