Trading Post Brexit - How Will It Affect My Business? | Herbst Software Herbst Software

Trading Post Brexit – How Will It Affect My Business?

With the historic Brexit agreement now delivered, attention turns to how businesses will respond to change. There is now an essential need to understand how your business will be affected post Brexit.

At Herbst software we’re aware that many of our valued customers will be affected by the changes that Brexit will bring, from new rules and regulations to new tariffs and changes the supply chains. We’ve put together some key points to help you understand some of the changes that Brexit will bring and now to navigate them, as well as other areas of business that may undergo changes.

What industries will be affected by Brexit?

Most industries will be affected by Brexit due to the potential economic impacts and manpower issues. Some industries will be impacted more than others but it is those that trade internationally that will see the largest number of changes. Businesses with European suppliers or customers will be impacted, while trade with non-EU countries will be affected by losing access to the EU’s current free trade arrangements and any customs blockages.

Obtaining an EORI number

An EORI number or Economic Operator Registration and Identification, is a code used to track and record customs information & to track interaction with different customs authorities. Any trader who imports or exports goods into or out of the European Union will need an EORI number, which is valid throughout the EU.

Going forward, businesses will need two EORI numbers, one for the country of origin and another for the country they are dealing with / destination country. Businesses in the UK can obtain a country-of-origin EORI number here. To obtain a code for the country you’re trading with, visit the EU National Customs Portal here. If you’re in Ireland, you can apply for an EORI number on the Revenue Portal

Lead Times & changes to supply chains

This is something that must be considered as lead times for goods may be substantially longer following the Brexit transition. Businesses should be proactive with this, checking with partners and suppliers to ensure the transition is as smooth as possible to limit delays.

Commodity codes

Import and export tariffs are also changing, meaning you will have to check the commodity codes you use to classify your goods on your customs declaration. Commodity codes are based on the type of product, material used and production method, so be sure to check if you have the correct codes. 

Contacting a customs agent can be a good way to ensure this process is as smooth as possible. You can find more info on commodity codes on the Revenue website.

Additional costs

A side effect of the Brexit transition for many will be additional direct & indirect costs. These costs must be accounted for within your supply chain. This raises the issue of adequate software & processes, can you accommodate additional costs and price changes quickly & effectively?

VAT changes

From January 1st, EU “rules of origin” regulations will have to be followed for imports from the UK. This could result in customs duties being imposed even if a zero-tariff, zero-quota EU-UK trade deal is struck.

It’s likely that there will be changes to VAT costs on goods imported into the UK, although not a certainty. This is definitely something to be mindful of the reality of the transition sets in.

Data

If your business involves the transfer of Personal Data across the border, you’ll need to ensure sufficient safeguards are in place so you can continue to transfer data after the transition period. This may include introducing Standard Contractual Clauses to your data arrangements.

Regulations – different frameworks

The UK’s exit means that there will be two separate legal structures as opposed to the previous single regulatory framework.

This means that now, for imports, companies on both ends will need to take steps to ensure that products are compliant with potentially different rules and regulations.

While Brexit preparations might be slightly different for everyone, a good initial step might be to consider the points mentioned above. Seeking third party expertise is also a helpful way to ensure that you’ll be ready for any implications of Brexit. As always, here at Herbst we’re on hand to offer any support and advice we can to help you navigate the Brexit transition. To contact us, email support@herbst.ie.

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