The plan for an end of year deal has not changed and Michael Gove recently spelt out the intentions behind this.
In a speech to Border Delivery Group stakeholders on February 10th, Mr Gove stated that as from the end of 2020, all UK exports and imports will be treated equally, whether with other nations, or the EU.
This means exporters in the EU, or the UK, will be required to submit customs declarations and all goods are likely to be liable to checks.
Neither will any special arrangements persist for UK businesses, beyond those in place for the rest of the world. The government view is that UK companies will have had time to prepare and a cut off point should be set.
The Given Rationale
Both the speech and a notification published on the same day provided reasons for bringing in import controls:
- Customs controls are part of keeping borders secure and knowing the actions of those entering.
- All potential trade partners should be treated equally, as we negotiate across the wider world.
- Border controls are required to ensure correct collection of VAT and customs, or excise duties.
- The EU intend to enforce checks on UK goods, the UK should act similarly to apply our rules.
An overriding intention to leave the customs union and single market are at the heart of the decision. The government believes this supports the referendum result and will assist in negotiating trade deals outside the EU.
Preparing For Change
The policy notification reminded businesses to prepare for border controls, by ensuring they have an Economic Operator Registration and Identification (EORI) number. Planning their route to make declarations was also mentioned.
There was an acknowledgement that most businesses use a customs agent, or freight forwarder, who will manage much of this for them. Greater awareness of requirements and tightening those relationships should still help.
None of us in truth know what the position will be in 10 months time. Different arrangements for Northern Ireland may well remain, other announced strategies, such as freeports, could have an influence on planning.
That any announcement at this stage is to a degree a political negotiating gambit is equally understood. EU representatives have also been busy making statements on their stance and trying to move the goalposts.
There is still little doubt that the change will be substantial and could be more or less as stated. Businesses need to move beyond contingency planning and have procedures ready for a range of possibilities.
If our team can help practically on Brexit changes, or with advice, by all means get in touch. We will keep you updated on any significant developments.