In June 2016, the British people were given the opportunity by David Cameron’s Government to vote in a referendum on whether the UK should remain a member of the European Union or whether the UK should leave.
It is now 47 years since the UK first became a member of the Union, but following the decision of the British people in that 2016 referendum, the UK will now leave the EU on 31 January 2020. The UK will become the first member state to do so.
The default legal position is that the UK will leave the EU on 31 January 2020 — either under the terms of the negotiated divorce deal if it is ratified (the Withdrawal Agreement), or without an agreement if that does not happen, which is now highly unlikely.
With less than two weeks to go before the UK formally leaves the EU, a deal between the UK & EU has still to be formally agreed. However, following the Conservative’s emphatic victory in the recent UK General Election, the UK’s House of Commons voted on 20 December 2019 to pass the Brexit bill — finally paving way for the UK’s January 31 departure from the European Union after years of political deadlock.
On 9 January 2020, MPs gave their final backing to the bill that will implement the UK Government’s Brexit deal. This latest vote gives approval to an 11-month transition period – also known as an “implementation period” – after 31 January 2020, in which the UK will cease to be an EU member but will continue to follow its rules and contribute to its budget.
The passing of the bill through UK parliament and the now highly likely transition period which will follow, will be good news for us here at Elite Moving Systems Ltd, as well as our clients and the relocation industry as a whole. The purpose of the transition period is to give time for the UK and EU to negotiate their future relationship, including a trade deal and customs arrangements.
This transition period would help avoid any sudden overnight changes to customs requirements, i.e. more vigorous checks being carried out and more documents required by customs officials at UK and French ports, plus, potential additional delays at the ports would be avoided (for now at least).
After the Withdrawal Agreement (WAB) becomes law in the UK, the WAB also needs to be ratified by the European Parliament. The stage will then be set for Brexit on 31 January 2020, when the post-Brexit transition period will begin.
The import/export relationship between the UK and non-EU countries will not change following Brexit.
What does a transition period mean for the relocation industry?
If the Withdrawl Agreement between the UK and the EU is ratified, the UK will become a non-EU country (a third country) and will withdraw from the EU on 31 January 2020. The free movement of goods between the UK and the EU will continue during the proposed transition period, which will run until 31 December 2020.
During the transition period, the UK will be considered an EU country for the purposes of customs clearance. The free movement of goods between the EU and the UK will continue until the end of the transition period.
The obligation for customs clearance of goods moving between the UK and the EU will begin when the transition period is over.
The UK will therefore remain part of the Single Market and the EU Customs Union during any transition period.
What would happen in the event of a No-Deal Brexit (which is now highly unlikely)?
If the transition period is implemented, No-Deal will be off the table and the UK will still benefit from the current agreement on the free movement of goods between EU countries. This means that for goods imported into the UK from another EU member state, duty-free entry of goods will still happen (apart from goods currently exempt from duty-free entry) and customs clearance procedures will remain the same as they are now.
In the event of a No-Deal outcome, the UK Government’s recent “Yellowhammer Report” advised of an additional time-scale for “delays” on shipments coming into and going out of the UK. This is in line with what we have also advised our customers, which is an additional 2 – 4 days on top of normal transit times currently in place.
With regard to the transportation of goods, it is possible that removal firms will need to custom clear goods, provide a commercial invoice and pay import duties.
The introduction of border checks between the UK and the EU could happen overnight and as the Government has already recognised, customs is a cliff-edge issue. On the day of the UK’s exit from the EU in the event of a No-Deal, the UK authorities will need to perform new functions and will face disruption at the border. There will be new document checks and fiscal requirements.
The introduction at UK customs of ToR (Transfer of Residence) for shipments coming to the UK from the EU by road, would almost certainly mean a delay in the shipper receiving their goods, as the transit time would be longer. Shipments would be held at French and UK road ports for longer, as more checks would have to take place – in particular, at the road ports of Dover, Folkestone and Ramsgate in the UK and at Calais and Le Harve in France.
As more vigorous checks will be needed and there will be more scrutiny on shipments to/from the UK/EU, this will mean delays. We do know that more staff have already been recruited at road ports in both the UK and in France.
Crews will be in Europe for longer than before, so the costs of a move may be greater as cost elements such as labour and vehicles are likely to increase. Those costs would have to be factored into the cost-planning of moves to and from the UK/EU in the event of a No-Deal outcome.
What is an EORI Number?
Either from 1 February 2020, or at the end of any transition period, it will be a requirement for any businesses transporting goods across Europe to have an EORI number. We already have our own EORI Number at Elite Moving Systems Ltd which starts with the letters GB.
An Economic Operator Registration and Identification (EORI) number is a unique customs ID for businesses. An EORI number issued by the UK will start with GB, followed by 12 digits. It will include the business’s VAT registration number if they are registered for VAT.
An EORI number from the EU starts with different letters depending on the country that issued it – for example, one issued in France will start with FR.
As of 31 January 2020, the United Kingdom will be a Member State of the European Union for the last day. From 1 February 2020, the United Kingdom will no longer be a Member State of the European Union. A transition period is likely to commence and will extend until 31 December 2020 when further information regarding the UK’s future relationship with the EU will be known.