Moving ever closer to a ‘hard’ Brexit

With the end of the transition period rapidly approaching, time is running out for the United Kingdom (UK) and the European Union (EU) to strike a trade deal. The transition period officially ends on 1 January 2021. If no trade deal has been reached by then, the World Trade Organization (WTO) tariffs will apply. In other words, it will be a hard Brexit – just what everyone had hoped to avoid. The negotiations are still ongoing, but it is time for companies that do business with the UK to really start preparing for the worst. However, after four and a half years of uncertainty, many are finding it difficult to finally take action. Here’s another reminder of what you can do.

Worst-case scenario 

In the worst-case scenario, both the EU and the UK will apply import tariffs to products. Besides that, there is likely to be some disruption such as delays to shipments into and out of the UK. A ‘no deal’ Brexit will lead to more complex customs procedures such as the need for extra documentation and checks, in stark contrast to today’s free movement of goods between the two regions. Freight companies are already increasing their margins, both in terms of time and money. As a result, companies and customers can expect their deliveries to take longer and probably cost more too. Although a trade agreement currently seems unlikely, it would remove many (but not all) of these obstacles – albeit probably not all at once. 

Supporting a smooth transition together

Over recent months, IDS has helped various customers to prepare for the transition by working with them to analyse their import and export process. The actual transport across the Channel often isn’t the major issue. Instead, the question is what kind of paperwork has to accompany goods arriving in the UK. 

Besides a Dutch shipper having to complete a declaration of export in the Netherlands, the recipient also has to declare the goods for import into the UK. And therein lies the uncertainty. Is everything properly prepared and arranged? Do your customers need any help with completing the declarations? What if the longer delivery times lead to higher costs? Will that perhaps mean that carriers won’t set out on their journey until the import declaration is ready in the UK? And how will all this affect rates? 

We’re happy to help you figure everything out. Together, we can double-check what has been taken care of already and what still needs to be done to keep your supply chain operational. No matter how the Brexit negotiations pan out.

Are you keen to get a clearer picture of how Brexit will affect your supply chain, and would you like to discuss it with one of our experts? Feel free to contact Arno Spoek: arno.spoek@idsnl.com.

Previously we wrote about Brexit: