Sending goods to the EU: overcoming the teething problems

With the Brexit deal agreed at the eleventh hour, it was never going to be an easy transition for businesses to prepare for the changes to exporting goods to the EU, and with newspaper headlines of lorries queuing on the motorway, early signs were not looking good.

After nearly a month in, whilst things are slowly improving, exporters continue to face problems with moving goods around the EU. Although there are challenges exporters are being faced with. Hazlewoods Director, Dan Town has reviewed what can be done to improve to speed up delays and keep your business moving.

Having the right paperwork and ’getting it right first time’ will certainly help with ensuring that your goods can move around the EU more smoothly. Early feedback suggests that as a result of insufficient paperwork, the French authorities are now checking all vehicles rather than a sample as they were initially, leading to delays of goods into France. The general findings of the French authorities which then cause delays are:

• a failure to fill out departure declarations properly;
• changing the end destination; and
• a lack of original export health certificates.

Ireland has sought to address some of these findings by allowing for exporters from the UK to use an emergency movement reference number to allow lorries to board ferries even if not all of the paperwork is completed. Whilst this provides some flexibility and keeps goods moving, this is seen to be temporary measure and assumes the proper paperwork will follow in short time.

For those companies that manufacture and export, understanding the origin of products and parts will ensure delays are kept to a minimum. One document that may help is the certificate of origin. This is obtained to help provide proof of origin in another country in order to obtain relief in that country. This is particularly important for manufacturers where goods are manufactured from parts from more than one country. Where two or more counties are involved in the production, the goods are deemed to have originated in the country where they last worked or were processed.

There are parameters to help assist with understanding this but given this may allow for goods to travel round the EU tariff free then it is important to understand the origin of products and obtaining a certificate of origin document for goods will help. A good example of this would be the Percy pig example, which is causing Marks and Spencer’s a headache.

One area which will be causing issues is when selling to individuals or non-VAT registered businesses. From 1 January 2021, whilst a UK company can zero rate the supply to the EU non-business customer, the problem arises where the EU customer will have to account for VAT in the EU on their purchase, which is usually through the postal service or courier. Some customers may not want to do this, so one solution would be to register for VAT in the counties in which the company trades, then charge local VAT to customers. Understandably, this creates the logistical nightmare of registering, which for a smaller business might not be an option.

Whilst it is still early days and not even a month into our new working agreement with the EU, one thing for sure is ensuring that paperwork is completed properly will give businesses the best chance for goods to move freely and quickly around the EU. Anyone unsure should seek advice at the earliest opportunity.

For advice on international trade for your business, please contact Dan Town at dan.town@hazlewoods.co.uk or 01242 680000.

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