Brexit Preparations – it’s Make or Break Time
Brexit Preparations – it’s Make or Break Time
It’s fair to say that 2020 has been a turbulent year, to say the least. With the Covid-19 pandemic causing significant unanticipated disruption throughout global supply chains and the economy, businesses have been distracted from what should have been the year of ‘Brexit Preparation’. While many Brexit deadlines have come and gone, it’s a fact that the end of the Brexit transition period on 31st December 2020 is enshrined in law. So Brexit will happen on 1st January 2021 – with or without a formal trade agreement.
Yet as many businesses have had to shelve Brexit planning in order to focus on surviving the fallout of Covid-19, they have had little time to familiarise themselves with the new customs requirements and plan accordingly. This lack of preparedness is concerning and as Andrew Tavener, Head of Marketing at Descartes explains, businesses must act now. If they think the Coronavirus disruptions have been devastating, the customs complexity post-Brexit could bring far greater disorder if businesses fail to act now.
Ready, Steady, Deal?
With the Brexit deadline rapidly approaching, it’s understandable that the uncertainty regarding the ‘deal or no deal’ is having an impact on business clarity. According to independent research undertaken by Descartes, 52% of UK businesses think a UK-EU trade deal is unlikely to be achieved in 2020, yet just 18% claim to be prepared for a ‘no deal’ exit from the EU.
The biggest concern when it comes to the impact of Brexit on cross border trade is delays within the supply chain, with tariff payments and customs declarations following closely. It’s clear that organisations with previous experience of the customs process are more concerned about the implications of Brexit compared to those supply chain managers that have not had to deal with the complex nature of customs before. And with ecommerce booming as a result of the pandemic, it could mean that smaller businesses may be caught out by this inexperience.
Post-Brexit Complexity
Beyond the impending deadline, companies will no longer be able to sell goods without any paperwork, or simply post products abroad as if they were being sent within the UK. Those days are soon to be long gone. Be there a deal or no deal, customs declarations will be mandatory. And this applies even for those businesses that choose – and are able – to defer import customs declarations for six months. They will still have to keep detailed import records.
There are two strategies that companies can choose from in order to remain compliant with the new regulations. They can either decide to complete declarations in house, or they can use an intermediary such as a customs broker or freight forwarder that will handle the process for them.
An intermediary may seem like a good choice here, but given the expected increase in demand there are just not enough of them to go around – Government figures suggest that British companies trading with Europe will have to fill in an extra 215 million customs declarations a year post Brexit.
The alternative is that businesses file declarations with HMRC themselves. However, the complexity involved could be overwhelming for those unfamiliar with customs processes. For example, do they know how to file the right documentation to ensure no delays at the border? Check the right commodity codes are used? And what about taking advantage of customs authorisations, including Inward Processing, Customs Warehousing, Transit and Customs Freight Simplified Procedures that could simplify the paperwork requirements for importers trading heavily with the EU or moving goods through multiple territories?
Security filings are another element that businesses must become familiar with post-Brexit. Security filings have long been applicable for sea and air transport, but post-Brexit they will be mandatory for all UK imports and exports, including road transport – though UK imports will be deferred for six months after the Brexit deadline. Unlike customs declarations, which can be submitted when items have already arrived in the UK in a bonded warehouse, security filings are required to be submitted at least two hours before the goods are due to arrive in the UK when transported by road. And if the goods are being transported through the Channel Tunnel by Eurotunnel, a declaration must be submitted at least one hour before check-in at Coquelles.
Simplifying Through Software
The complexities involved in customs declarations mean that those businesses looking to self-file could struggle to take on the process alone. As such, they should consider a software service that can simplify the process by speeding up the creation of documentation for imports and exports with the EU countries. Combining a Software as a Service (SaaS) customs solution that ensures all regulatory changes are automatically updated and available, with staff training to achieve in-house expertise, will deliver a smooth transition into Brexit and provides a strong foundation for current and future business development.
This technology can also incorporate the required security filings, helping carriers and logistics intermediaries manage Import Control System (ICS) compliance by providing a single point of access. Moreover, a digital solution also enables carriers to connect with brokers, shippers and regulatory authorities around the world, without having to worry about data formats or specific state requirements.
Combining customs and security filing software solutions with fleet optimisation and compliance management solutions will achieve even greater efficiency. Route optimisation can be achieved through telematics solutions that incorporate intelligent algorithms to also deliver real-time vehicle visibility – essential for businesses that need to meet growing customer expectations and thwart anticipated Brexit-induced supply chain delays. This also provides operators with the ability to reroute vehicles as necessary to avoid delays and add new deliveries or pickups.
Beat the Clock
The Covid-19 pandemic initiated a rapid and irreversible shift towards ecommerce, which ultimately caused significant strain on supply chains. Moreover, this shift will also cause an exponential increase in customs declarations, which coupled with the rise that Brexit will bring could result in severe disruption for those businesses that are unprepared. It’s time – businesses must act now!
For more information see www.descartes.com/brexit
Brexit Preparations – it’s Make or Break Time
It’s fair to say that 2020 has been a turbulent year, to say the least. With the Covid-19 pandemic causing significant unanticipated disruption throughout global supply chains and the economy, businesses have been distracted from what should have been the year of ‘Brexit Preparation’. While many Brexit deadlines have come and gone, it’s a fact that the end of the Brexit transition period on 31st December 2020 is enshrined in law. So Brexit will happen on 1st January 2021 – with or without a formal trade agreement.
Yet as many businesses have had to shelve Brexit planning in order to focus on surviving the fallout of Covid-19, they have had little time to familiarise themselves with the new customs requirements and plan accordingly. This lack of preparedness is concerning and as Andrew Tavener, Head of Marketing at Descartes explains, businesses must act now. If they think the Coronavirus disruptions have been devastating, the customs complexity post-Brexit could bring far greater disorder if businesses fail to act now.
Ready, Steady, Deal?
With the Brexit deadline rapidly approaching, it’s understandable that the uncertainty regarding the ‘deal or no deal’ is having an impact on business clarity. According to independent research undertaken by Descartes, 52% of UK businesses think a UK-EU trade deal is unlikely to be achieved in 2020, yet just 18% claim to be prepared for a ‘no deal’ exit from the EU.
The biggest concern when it comes to the impact of Brexit on cross border trade is delays within the supply chain, with tariff payments and customs declarations following closely. It’s clear that organisations with previous experience of the customs process are more concerned about the implications of Brexit compared to those supply chain managers that have not had to deal with the complex nature of customs before. And with ecommerce booming as a result of the pandemic, it could mean that smaller businesses may be caught out by this inexperience.
Post-Brexit Complexity
Beyond the impending deadline, companies will no longer be able to sell goods without any paperwork, or simply post products abroad as if they were being sent within the UK. Those days are soon to be long gone. Be there a deal or no deal, customs declarations will be mandatory. And this applies even for those businesses that choose – and are able – to defer import customs declarations for six months. They will still have to keep detailed import records.
There are two strategies that companies can choose from in order to remain compliant with the new regulations. They can either decide to complete declarations in house, or they can use an intermediary such as a customs broker or freight forwarder that will handle the process for them.
An intermediary may seem like a good choice here, but given the expected increase in demand there are just not enough of them to go around – Government figures suggest that British companies trading with Europe will have to fill in an extra 215 million customs declarations a year post Brexit.
The alternative is that businesses file declarations with HMRC themselves. However, the complexity involved could be overwhelming for those unfamiliar with customs processes. For example, do they know how to file the right documentation to ensure no delays at the border? Check the right commodity codes are used? And what about taking advantage of customs authorisations, including Inward Processing, Customs Warehousing, Transit and Customs Freight Simplified Procedures that could simplify the paperwork requirements for importers trading heavily with the EU or moving goods through multiple territories?
Security filings are another element that businesses must become familiar with post-Brexit. Security filings have long been applicable for sea and air transport, but post-Brexit they will be mandatory for all UK imports and exports, including road transport – though UK imports will be deferred for six months after the Brexit deadline. Unlike customs declarations, which can be submitted when items have already arrived in the UK in a bonded warehouse, security filings are required to be submitted at least two hours before the goods are due to arrive in the UK when transported by road. And if the goods are being transported through the Channel Tunnel by Eurotunnel, a declaration must be submitted at least one hour before check-in at Coquelles.
Simplifying Through Software
The complexities involved in customs declarations mean that those businesses looking to self-file could struggle to take on the process alone. As such, they should consider a software service that can simplify the process by speeding up the creation of documentation for imports and exports with the EU countries. Combining a Software as a Service (SaaS) customs solution that ensures all regulatory changes are automatically updated and available, with staff training to achieve in-house expertise, will deliver a smooth transition into Brexit and provides a strong foundation for current and future business development.
This technology can also incorporate the required security filings, helping carriers and logistics intermediaries manage Import Control System (ICS) compliance by providing a single point of access. Moreover, a digital solution also enables carriers to connect with brokers, shippers and regulatory authorities around the world, without having to worry about data formats or specific state requirements.
Combining customs and security filing software solutions with fleet optimisation and compliance management solutions will achieve even greater efficiency. Route optimisation can be achieved through telematics solutions that incorporate intelligent algorithms to also deliver real-time vehicle visibility – essential for businesses that need to meet growing customer expectations and thwart anticipated Brexit-induced supply chain delays. This also provides operators with the ability to reroute vehicles as necessary to avoid delays and add new deliveries or pickups.
Beat the Clock
The Covid-19 pandemic initiated a rapid and irreversible shift towards ecommerce, which ultimately caused significant strain on supply chains. Moreover, this shift will also cause an exponential increase in customs declarations, which coupled with the rise that Brexit will bring could result in severe disruption for those businesses that are unprepared. It’s time – businesses must act now!
For more information see www.descartes.com/brexit
