Legal News | 25.10.19
Imports and Exports, Farming and Trade
We are due to leave the EU on 31 October and businesses need to make sure they are ready for all the changes that come along with it.
Trade
Trade Agreements
At the moment, the UK is involved in many trade agreements with other countries all over the world via membership of the EU. These agreements provide the UK with preferential market access and favourable tariff rates, amongst other benefits.
The UK has been trying to transition these agreements to allow them to continue with the same agreed terms post Brexit. However there are many countries that the government hasn’t managed to replicate current agreements with: Albania, Algeria, Andorra, San Marino, Bosnia, Cameroon, Canada, Cote d’lvoire, Egypt, Georgia, Ghana, Japan, Jordan, Kenya, Kosovo, Mexico, Moldova, Montenegro, Morocco, Serbia, Southern Africa Customs Union, Turkey, Ukraine. The consequences are that if we do leave the EU with no deal in place, the currently agreements will be void and if trade is to continue between such countries it has to proceed on World Trade Organisation terms.
The World Trade Organisation is a governmental organisation with 164 members and is a basis to negotiate the rules of international trade. The UK is already a member of this. Every WTO member has a list of tariffs and quotas they apply to other countries, known as WTO schedules. As well as trade tariffs, it has rules on product standards, safety regulations and sanitary checks. The rules state that the same trading terms must be applied to all countries, unless there is a trade agreement between two or more countries e.g. the system the EU has where it can have a zero tariff on cars imported between members but can keep the tariffs on cars imported from America. This is called the Most Favoured Nation treatment.
Tariffs
A tariff is a tax imposed by one country on the goods and services imported from another country. The tariffs currently in place on exports and imports will change and those tariffs will apply to goods imported from countries where there is no trade agreement in place, if there is a no deal. Temporary figures have been decided by government if that were to happen, with a view to a permanent approach being decided on in the future.
Steps to take:
- Check if the businesses you trade with or source goods from are based in countries that have agreed to replicate EU free trade agreements
- Check what tariffs will apply to the goods you import into the UK
- Check if your international customers will have to pay tariffs on the products you are exporting to them
Farming
Funding – EU Common Agricultural Policy
- Pillar 1 funding: this is where you receive payments from the Basic Payment Scheme or Common Market Organisation Schemes. The BPS’s purpose is to supplement their main business income. To qualify for this you must actively farm your land and is available to farmers who are allocated payment entitlements. You can apply for entitlements based on the land you farm and the activity you undertake. Basic Payment Scheme payments will be phased out from 2021 to 2027.
- Pillar 2 funding: this is where you receive payments from projects under the Rural Development Programme for England. This programme provides money for projects to improve agriculture, the environment and rural life. Funding goes to scheme to: improve the environment, increase the productivity of farming and forestry and to grow the rural economy. All projects started before the end of 2020 will receive payment for its entire lifetime.
Steps to take:
- Decide if you want to apply for Basic Payment Scheme payments in 2020, despite them being phased out
- Decide if you want to apply for Rural Development Programme for England payments, as this funding isn’t being phased out
- Look into future funding options. More information can be found on GOV.UK , ‘future farming’
Imports and Exports
Importing live animals, fish, animal products and Products of Animal Origin (POAO)
Most imports that originate in the EU will not require new checks at the border. They’re not checked now and won’t be post Brexit.
POAO that originate in a third country and enter into the UK after transiting through the EU will have to enter the UK via a Border Inspection Post for veterinary checks. A list of existing BIPs in the EU can be found on GOV.UK and it is worth noting where these will be because redirecting your trade route may be necessary.
Most of EU caught fish imported to the UK will require a catch certificate, which are issued by the country where the fishing vessel is registered. They prove the fish have been caught legally and contain information about when, where and how the fishing took place. Importers of live animals will also have to notify APHA via an IV66 form at least 24 hours before arrival to the UK.
Importing plants and plant products
Plants currently under the EU plant passport scheme will have to have Phytosanitary Certificates. These certificates are issued by the Forestry Commission to the national plant protection organisation in the importing country and they certify the material has been inspected and is considered free from quarantine pests. You can apply online or by sending a paper copy and a fee of £15 is payable for issuing the certificate and a minimum fee of £37 is payable if an inspection is required. Which plants require this can be found on GOV.UK. After obtaining the certificate, importers will need to notify the relevant authorities before arrival to the UK, where the documentation will be checked.
Wood packaging treatment must also meet ISPM15 standards by undergoing certain treatments, requiring that they be debarked and then heat treated or fumigated with methyl bromide and stamped or branded with a mark of compliance.
Exportation of plants and plant products, and animal products etc
Live animals must be registered and identified, usually with passports, travel IDs or ear tags.
A catch certificate for most fish exports must be produced.
A signed Export Health Certificate must be produced.
The process for sending regulated plants and plant products to the EU will be the same as the current process for sending them to third countries.
Food labelling changes
After Brexit, the EU emblem cannot be used on goods produced in the UK. Instead, if you are importing from the EU, you must include a UK address for the food business operator on pre-packaged food sold in the UK. If you are exporting to the EU, you must include an EU address.
How can we help?
There is a lot of information to take in surrounding Brexit and if you would like to come in a have a chat about how it may affect your company, then please speak to one of our Commercial Team members on 01380 733300 or email us at commercial@wansbroughs.com.
We can provide advice on World Trade Organisation terms, if you deal with a member of the EU that the UK doesn’t currently have a trade agreement with. We can also provide advice on the various funding options for farming schemes, in terms of what is and isn’t being phased out and what option is the best for you. There is also still a lot of ambiguity surrounding border inspection posts etc., so we will be able to assist with deciding the best way around this. Any applications or registrations that need to be done is also something we can help with.
