Please find below this week’s EU Exit and Trade update from the BEIS Infrastructure and Materials team. In this edition, they cover changes to the rules on paying import VAT, standards and regulations on fluorinated gases, including actions for you to take if this affects you, an update on the EU-US mutual recognition agreement and on trade agreement continuity.
HMRC Entry Summary Declarations – HMRC announced on 19 February plans to phase in the pre-arrival forms known as Entry Summary Declarations for EU imports, if the UK leaves the EU without a deal, providing a six month respite for carriers.
This means that:
- Trucks arriving from Europe do not need to hold a separate Safety and Security document which they previously needed to hold to obtain a Movement Reference Number (MRN) from HMRC without which the truck, and any freight carried, could not continue their journey into the UK.
- This does not change the current process for goods leaving the UK and entering the EU by road which will remain the same.
The new rules only apply to goods coming from the EU. Importers will still be required to submit import declarations for customs purposes – which are not the same as Entry Summary Declarations.
After the six-month transitional period, carriers will be legally responsible for ensuring Entry Summary Declarations are submitted pre-arrival to HMRC at the time specified by mode of transport. More broadly HMRC have produced some short video guides on EU Exit and have outlined the phased approach for Entry Summary Declarations.
Changes to the rules for reporting and paying import VAT that will impact sellers outside the UK – From 29 March 2019, if the UK leaves the European Union without a deal, the import VAT rules will change for goods worth £135 or less that are sold to UK buyers (including businesses and individuals).
Action to take now If you choose to report and pay the import VAT direct to HMRC, you should register for the new online service now, so you are ready to use it when the changes are introduced on 29 March 2019. To get started, you will need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you register. You will also need your business contact details and details of your business accounting periods.
Trade Agreement Continuity – The Department for International Trade have published a Written Ministerial Statement together with the Gov.uk guidance and accompanying news story on the UK’s progress in securing agreements with the EU’s existing Free Trade Agreement partners and transitioning existing EU Free Trade Agreements
In a deal scenario, the EU has agreed that the UK should continue to be treated as a Member State in international agreements during the implementation period. However, if a deal is not in place when the UK leaves the EU on the 29th March the UK’s preferential access to some of these markets will end. We encourage you to share the guidance with colleagues and members.
Trade Remedies – On 25 February, the Department for International Trade published the final list of existing EU anti-dumping and anti-subsidy trade remedies that will be retained in the UK’s trade remedies system when we exit the EU. If there is no deal with the EU, these decisions will apply from 29 March. If there is a deal, the UK will continue to apply all EU trade remedies throughout the Implementation Period to December 2020.
All transitioned measures will be maintained at the same level set previously by the European Commission until the new Trade Remedies Authority completes a full review based on UK-specific market data. Following consultation, 43 existing EU measures will be transitioned to the UK and 66 will be terminated. Further detail, including the full list of measures, can be found here.
Government Procurement Agreement – Members of the World Trade Organisation confirmed on 27 February that the UK will join the Government Procurement Agreement (GPA) as an independent member if we leave the EU without an agreement. The GPA is an agreement within the WTO framework between its 19 members (including the United States, Canada, the EU and Japan) that aims to mutually open government procurement among it parties. The UK’s independent membership gives businesses the certainty that they will be able to continue bidding for public sector contracts overseas on almost the same terms that they do now. Where an Exit deal is agreed with the EU, and an implementation period is put in place, the UK will remain a member under the EU’s membership.
Further detail can be found here.
Fluorinated gases (F gases) – If the UK leaves the EU without a deal, businesses that produce or import F gas or ozone-depleting substances (ODSs) in the UK must register with a new UK system. Guidance can be found here. Businesses are able to register between 11 February and 12 April 2019.
UK businesses which are already registered on the EU system will receive an email from Defra about how to register. Other businesses can also register online; Businesses that register before exit day (29 March 2019) will be able to operate as normal from 30 March 2019. Anyone who registers between 30 March and 12 April 2019 would have to wait for their registration and quota application to be approved before they can trade. Businesses looking to secure an F Gas quota for the first time would need to wait until after 12 April 2019 before they can use their quota to import gas. Anyone registering after 12 April 2019 would not get a quota for 2019;
You can read the Press Release about the launch of the new system, which provides a summary of the main points.
Mutual Recognition Agreement (MRA) – The Government has signed a Mutual Recognition Agreement on Conformity Assessment (MRA) with the US. The agreement provides continuity for existing arrangements to continue between the UK and US which will help facilitate goods trade between the two countries.
Latest GOV.UK Updates
Sector Summary updates
BEIS Business Readiness Forum
As noted in the last update, please be aware that BEIS hosts a weekly EU Exit business readiness forum for trade associations to attend at our 1 Victoria Street offices in London. The next meeting will be held on Thursday 28th February will cover EU funding, procurement and energy issues. If you represent a trade association and wish to attend, please email email@example.com.
In addition the BEIS EU Exit Business Intelligence and Engagement Team issue a weekly bulletin aimed at keeping trade associations and businesses up to date on the latest information and guidance on the UK exiting the EU. The latest issue is attached.
Business readiness tool on Gov.UK
The Government have published a business readiness tool on Gov.uk which asks companies various questions to help identify the technical information the company requires. The tool now includes pages for metals manufacturing and chemicals for companies in those specific sectors. Please do encourage colleagues and members to use the tool if they have not done so already.