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12 February 2019
No Deal Preparations

With the United Kingdom’s date for exiting the European Union of 29th March fast approaching, the government has started to publish detailed advice on preparing for a ‘no deal’ scenario.

The UKFT predicts that a ‘no deal’ Brexit will cause significant disruption to the fashion and textile trade and it will publish all relevant parts of the government’s advice on its website, along with its own advice and its UKFT Brexit Checklist.

The latest information from Government says that all companies trading with the EU should:

* Ensure they have registered for an Economic Operation Registration Identification (EORI). The application process is very straightforward but there are different forms depending on whether you are registered for VAT or not.
*  Register in advance to use the Transitional Simplified Procedures – these transitional simplified procedures reduce the amount of information you need to give in an import declaration when the goods are crossing the border. They do this by allowing you to defer giving a full declaration and defer paying any duty.
If tariffs apply to the goods that you import and you want to use transitional simplified procedures, you will need to:

* Apply to defer any duties payable to a later date – UKFT will inform the industry how to do this when the streamlined process for deferring duty is available.
*  Have a financial guarantee by 30th June 2019 for any duties deferred.
*  Ensure they are ready to make customs declarations and comply with other customs procedures on goods traded with the EU. Depending on how you move your goods you may need to make a declaration before the goods arrive.
*  For VAT, if there is a no deal then similar VAT arrangements will apply to EU member states as to trading with other non EU countries. After 29th March you will not be able to submit a VAT refund claim using the EU electronic VAT reclaim system. You will need to reclaim VAT from an EU member state using that member states existing procedures for businesses based outside the EU. UKFT expects that UK companies would have to pay EU VAT on tradeshow space. It remains unclear whether companies would be able to reclaim this and how long it might take.

If a company’s products carry a CE mark it can carry on using the mark after 29th March, but if the registration was made via a UK certification body it may have to reapply to an EU-based certification body. A new UKCA certification system is also being set up.

 

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