Trading forward: How businesses adapted and are now making progress under the new relationship with the EU

The zero tariff, zero quota trade agreement we have agreed with the EU will see UK firms able to keep doing business with Europe while enabling them to seize new opportunities as we strike trade deals with the world’s fastest growing markets. However, now that we are outside the EU customs union, there are new processes and rules which businesses need to follow.

There are new rules on exports, imports, tariffs, qualifications, hiring and travel, and businesses need to prepare and adjust to the new relationship with the EU.

City A.M. spoke to some businesses who have done just that, and are getting used to the new arrangements.

Keeping business moving

Martin Stemp runs RS Aqua, an ocean technology firm based in Portsmouth. He imports and exports millions of pounds of goods every year, so he was keen to understand the new admin around the process.

He admits he was concerned about what would happen after the Brexit transition period ended on December 31. 

“I was worried about the added administrative overheads, the costs and things being slower to clear through Customs. We’re not supplying perishable goods but many of our customers are very keen to take hold of their equipment on short lead times because of their own requirements,” he says. 

RS Aqua already export across the world,  which helped them with the new processes. By the time January 1 dawned, Martin was confident that they’d done what they could to prepare for the changes to the way we trade with the EU.

“We had some delays initially partly because of the issues at Dover that were Covid-related to a degree,” he says, but now physical movement of goods is close to normal.

He and his supply partners are also working through new VAT implications.

Like many firms who have adapted to the new scenario, Martin says the most important thing is simply getting down to do it. 

“There is a lot, it’s not to be sniffed at,” he says in regards to the changes. “But there is support there if you need it, and that’s where I suggest working with the Department for International Trade – they have an Export Champions programme which we’re happy to support – and also by talking to peers in your industry who are already exporting who can help.”

The details

Amongst the new administration is the need to get custom codes for goods that are being exported to the EU.

Those codes – EORI numbers – are internationally recognised standards that help Customs authorities across the world track what’s moving across borders.

That code is a key part of customs declarations, which firms now need to do for exports to the EU. Some companies do this themselves, but most use an intermediary like a courier, freight forwarder or customs agent. They’ve been doing this for years and have swiftly adapted to the new rules.

New border controls

Buying and selling goods

• To continue trading with the EU, businesses need to follow new rules for importing and exporting, including changes to customs processes and licensing. 
• Most businesses use a specialist such as a customs broker, freight forwarder or fast parcel operator to deal with import and export declarations.

Avoiding hold-ups at the border

• Hauliers can use the ‘Check an HGV is ready’ service to make sure they have correct paperwork and should obtain a negative Covid-19 test, and a Kent Access Permit if they plan to travel via Dover or Eurotunnel.

Help with paperwork is available

• Most businesses use a specialist such as a customs broker, freight forwarder or fast parcel operator to deal with import and export declarations.
• The Government offers dedicated helplines, webinars  with policy experts, step-by step guides, video explainers and a Brexit Checker tool for personalised actions to suit individual circumstances.
• The Government has made over £80 million available to expand the capacity of the customs agents market, and recently announced an additional £20m to support SMEs adjust to new customs, rules of origin, and VAT rules when trading with the EU

A Welsh success story

Anthony Pickering runs Control Techniques, a Welsh firm which manufactures electric motor control technology for industry. They export to 77 countries and have 26 sales sites across the world. 

“Planning has been the root cause of our success since January 1, because we’re reliant on our supply chain. Our factories are full – we’re absolutely flat out, with orders coming out of our ears,” he tells City A.M. 

“We had to look at our supply chain, which meant going to our suppliers and making sure they were ready, and had contingency plans in place – for example, if the port at Dover became blocked.”

There are still some differences – some items are taking longer to arrive than they did previously – but Pickering puts that down to teething problems. “It will figure itself out,” he says. 

That pragmatic optimism has worked for the firm – not only are they still exporting as normal, but they even ‘reshored’ a factory from China to Wales during the Covid-19 pandemic to become a solely British manufacturer.

Preparing for success

Those firms that have taken the time to adapt to their new rules are operating happily under the new regime – as well as looking forward to more global opportunities in the future. 

The UK Government knows that it’s a significant change to the way firms do business, so all the information to help them adjust is available at gov.uk/transition.