Tag: Brexit

It is that time of year again when we reflect on the previous year, take stock of the current situation and project forward at what the New Year may bring. You may already have an idea where I’m going with this from the title?!

Usually the budgeting and forecasting at Anglia Freight is a fairly simple process of using historic results and nailing our flag to the mast for what we want to achieve for the next year. The slight snag this year is that we do not have the foggiest idea what the lay of the land will be for 2019.

Business leaders are having to make up to three or four strategy plans to cover the most likely eventualities of what life looks like once the BREXIT outcome is decided. It is not unusual for Companies to have multiple plans, but the problem we all face here is not just the whole uncertainty of criteria, but the sheer scale and magnitude of differences between the outcomes of one path to another.

One of Anglia Freight’s values and intentions is to always offer Peace of Mind to our Customers. I’ve mentioned before, it is a big deal for Customers to put their trust in us to deliver and look after their products which are in effect their livelihoods. We aim to be a key step in the sequence of steps to get product to market, where our Customers have complete faith and confidence in us to do our part effectively. Thus freeing up more time to focus on growing their own Business or in the next few months, potentially weathering whatever storm may arise.

So you could say that part of our Business model and plan for 2019 is ensure that we are the Calm amongst the Storm for our Customers, Suppliers and Staff. There will be a lot of valued work behind the scenes to do this and we will continue to thrive. Living by our values; Exceptional Service, Innovation, Peace of Mind and Loyalty, which will all help ensure we are a stand out, robust certainty in a sea of uncertainty that we find ourselves in today.

From all of us at Anglia Freight, regardless of the fun times ahead, we wish you a successful 2019 and look forward to continue working with you and growing from strength to strength.

Douglas Shawcross – Managing Director

We published our first Brexit blog, back on the 29th June 2016,  a few days after the EU Referendum had taken place and the UK had voted to leave the European Union.  So, what’s happened since then?

Article 50 has been Activated

Article 50 is the formal legal process by which the UK will leave the EU.  Part of the Lisbon Treaty, formed in 2009, Article 50 details a five-step process which is put in place if any country wishes to leave the European Union.  Prime Minister Theresa May triggered Article 50 on the 29th March 2017.  It allows for two years of negotiations to take place between the UK and the EU to agree on exit terms which the remaining 27 members states vote to approve.

If an agreement is not reached, negotiating times could be extended, but for the moment, the UK is scheduled to leave the EU on Friday, 29th March 2019, with an exit deal agreed and all existing trade agreements ceasing to apply.

Brexit options and possible outcomes

Four months since negotiations started,  mixed messages continue to circulate about what Brexit means for us, our customers and the entire UK logistics and supply chain industry.  Even if the UK and the EU agree to replicate a trade agreement similar to those it has with Switzerland, Norway or Turkey, (none of which satisfy the UK’s trade requirements), 18 months is not long enough to implement a Free Trade Agreement (FTA).  This leaves the UK with two options:

Option 1 – ‘Hard Brexit’:

  • Here, the UK is free to broker its own worldwide trade agreements. However, as of 30th March 2019, all UK imports and exports will be subject to the World Trade Organisation’s (WTO) most favoured nation tariffs.  In other words, imports and exports will become more expensive.
  • Free Trade Agreements will also need to be negotiated with each country individually, but even the most simple FTAs take a minimum of five years to agree and adopt. With the UK being a much smaller country than some of our EU counterparts, it will not have the same negotiating power with larger countries such as China and the USA.

Option 2 – ‘Soft Brexit’:

  • Here, the UK would need to agree on a Transitional Arrangement with other EU countries. i.e. a ‘copy and paste’ of current EU legislation into UK law. This would allow the UK to continue to trade freely with the EU and its partners while allowing more time to broker a full trade deal with the EU and the rest of the world.
  • The issue with soft Brexit is that it prolongs everything. Not only is it feared that this would damage UK businesses, but it could cause more multinationals to relocate their businesses  The UK will no longer have a voice in the EU so it will be forced to abide by legislation without having any voting rights.

Impacts of Brexit upon Imports and Exports

So, what happens when the UK leaves the EU?  We’re hoping that the UK government will negotiate a good deal for both the importing and exporting of goods into the EU. However, there are some real impacts worth considering when our ‘new’ UK border is in place.

Currently…

  • Lots of European businesses move goods in free circulation throughout the EU, e. they have been subjected to the payment of VAT and duty in the country into which they entered Europe.
  • The subsequent sale and movement of these goods requires no checks and with minimal paperwork, only small delays and negligible border issues result.
  • The EU allows for periodic reporting of these movements via Intrastat. These VAT & EU sales reports allow for the combination of all individual shipment reports, which is far more efficient than having to submit a report for each.

 Once the UK leaves the EU…

  • All movement of goods will immediately become genuine imports and exports and will be subject to border checks and will require full import/export declarations. This drain on business administrative resources could have severe implications on their performance and profitability by adding time and cost to the supply chain.
  • Increased border inspections and import clearance requirements will slow up the transition time of goods as they pass through ports and borders, creating delays and disruption.
  • The administration costs for the importer will increase as additional documentation containing full fiscal details of the shipment will need to be submitted at the time of import.
  • Submitting a complete declaration into HMRC’s customs system, CHIEF will increase the cost of submissions as forwarders and agents will also have to charge for their time.
  • Manufacturing industries such as the motor trade could be severely affected by the imposition of taxes. They currently move parts and finished goods freely throughout the EU, but without an FTA, could attract a duty of up to 10%.

Top 3 Actions To Get Brexit Ready

The EU will not agree to the UK remaining in the Customs Union without being a full member of the EU,  so having triggered Article 50 this is not an option open to the UK.  It looks likely that post-Brexit the UK will adopt the EU customs legislation, the Union Customs Code (UCC), which came into force in May 2016.

Whatever Brexit option is agreed, the following three key actions will help you get Brexit-ready.  They are guaranteed to help you save costs, give you a competitive edge and allow your goods to fast-track through the new UK border.

Action 1 – Review your supply chain now

  • Start talking to your customers, suppliers, forwarders and agents. Map out and fully understand how your goods are currently moved from supplier to end user.
  • Study your supply chain. Businesses that currently import or export outside the EU will probably have processes and procedures in place to manage VAT and duty payments on import. However, the terms of Brexit may affect your ability to import or export duty-free.
  • Ask suppliers about the origin of your goods, i.e. the “economic” nationality of goods. Having proof of origin is imperative to claim any reduction in duty. If you buy or sell from any of the countries that the EU has agreements with then your sale or purchase could be affected by the terms of Brexit.  Companies that currently only trade with the EU27 group of countries, i.e. have ‘Intra EU movements’ will need to start talking to their suppliers, forwarders and agents to ensure that they can perform the necessary export/import requirements.  You must also have a system in place to cope with the payment of any taxes that may be due.
  • Check out the list of EU countries.

Action 2 – Review your existing and new contracts

  • Review both your current and new contracts with your customers and suppliers and agree on sensible Incoterms®2010 rules which will ensure that you mitigate risks and minimise transit costs.
  • Check out the map EU trade agreements.
  • Check you have the correct terms in place. Having the incorrect terms in place could result in your business losing margin from unexpected transit costs or if goods are lost or damaged, resulting in insurance disputes and unforeseen expenses to put things right.

Action 3 – Review and update your internal processes and procedures

  • Apply for customs authorisations and simplifications like AEO, Customs Warehousing and Inward & Outward Processing Reliefs now. They are all dependant on your activities but could help you mitigate import and export costs and reduce risk.

How We Can Help

  • Don’t leave the above actions on your to-do list!
  • Anglia Freight works closely with Import Export Support, a local company that helps and advises us on Brexit issues. They are also able to step in and provide some Brexit advice for you.  They have extensive experience in dealing with international trade and HMRC, working with companies on their authorisations and procedures to help smooth out the ripples in the supply chain and to reduce the cost of moving stock around the globe.   They have submitted several successful duty reclaims, set up a customs warehouse, gained customs simplifications and work closely with HMRC on improving import compliance for their clients.
  • Call us on 01379 872872 or check out angliafreight.co.uk.
  • Call Tracey Renshaw at Import Export Support on 07710 238113

Finally, a huge thank you to Tracey Renshaw at IES, who provided us with the very latest information to help us make this blog as informative and useful as possible.

Following the EU Referendum on June 23rd and the decision for the UK to leave the European Union, there’s been much speculation about what Brexit means for you and for the UK logistics and supply chain industry.

We’re conscious of the uncertainty this causes, but for now, the UK is still a member of the EU and will continue to be whilst negotiations around trade deals and movement of goods take place over the next two years.

In the meantime, we’ve got our ear to the ground and are well informed within the industry.  We have regular communications from both the British International Freight Association and Road Haulage Association as well as keeping up to date with local business news via the Suffolk Chamber of Commerce.

So for the time being, it is very much business as usual.  The way we ship to and from the EU remains the same and we’re here to help you trade with your customers in Europe.

Anglia Freight ships to all 28 EU countries

As a shareholder member of the award winning Palletline network, we ship to any of the 28 countries in the European Union.  Shipping to EU countries occurs in exactly the same way as shipping to any part of the UK with no special documents required.   Whether you’re shipping to Bulgaria, Spain or Germany, follow our ‘Getting it Right’ guide below.

Shipping to Europe – Getting it Right

  • Tell us your collection date
  • Tell us your collection address with postcode, name of contact and their phone number
  • Tell us your delivery date
  • Tell us your delivery address with postcode, name of contact and their phone number
  • Know your country code. Each country has its own unique country code e.g. France is FREU
  • Tell us of any specific delivery instructions
  • Tell us what service level you need e.g. 2 days, 5 days
  • Tell us if you are transporting hazardous cargo
  • Tell us how many pallets you are transporting and how much they weigh
  • Correctly label all pallets with a Palletline/Anglia Freight label

Need more information? Call 01379 872872

Email sales@angliafreight.co.uk

Click our Distribution page for further details.