BREXIT: New ways of business with UK for flow of goods

BREXIT: New ways of business with UK for flow of goods

BREXIT: New ways of business with UK for flow of goods 1500 981 Exponens International

BREXIT: New ways of business with UK for flow of goods

Published on 02/08/2021

Since 1st February 2020, the United Kingdom (UK) has withdrawn from the European Union (EU) and has become a “third country”. The Withdrawal Agreement provided a transition period until the 31st December 2020. In 2020, nothing changed.
The EU and the UK came to a last-minute trade deal on Christmas Eve, avoiding the hardest of all potential Brexits. But major tax uncertainty remains, waiting comments from French tax authorities. For now, French authorities answer some of our questions via a FAQ updated following the trade deal of December 2020.

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TRANSACTION OF GOODS WITH UK: EORI NUMBER

Goods will no longer be able to move freely after the Brexit. If you realize transactions of goods with the UK (import or export), you need an EORI number. If you already have a GB EORI number, it will be no longer valid after the Brexit, so you may ask for an EORI number in France.

NEW BORDER: NEW CUSTOMS DUTIES

The UK Global Tariff (UKGT) will apply to all goods imported into the UK. Find out more.
Your goods imported in France from UK should be subject to customs duties. Find out more.
We advise you to check with your forwarding agent or find one if you expect doing business with UK.
Some products are covered by a tariff-rate quota. This allows a limited amount of a product to be imported at a zero or lower tariff rate. Lately, in December 20, the UK and the EU agreed under a free trade agreement (FTA) to remove tariffs for each other’s originated goods. You may also benefit of a zero-rate depending of the origin of the products.

INCOTERMS: WHO WILL SUPPORT THE SHIPMENT COST ?

The Incoterms rules are standard sets of trading terms and conditions designed to assist traders when goods are sold and transported. So by agreeing on an Incoterms rule and incorporating it into the sales contract, you can achieve a precise understanding of what each party is obliged to do, and where responsibility lies in event of loss, damage or other mishap. You should update your business contract with UK.

EXCEPTION FOR THE NORTHEN IRLAND

The EU and the UK have agreed that Northern Ireland is treated as if it were a Member State, the initial period of application extending to 4 years after the end of the transition period. But the Ireland/Northern Ireland Protocol provides that EU VAT rules apply only to goods (not to services).

The information related to the practical consequences of the Brexit given by French tax authorities are very parsimonious. Thus, we are still monitoring the announcements by France and EU authorities. In the meanwhile, we are available to discuss any issues you may face at this stage of the Brexit.

Related insights:

Brexit – New ways of business for UK company with no PE in France – Read article
Brexit – UK R&D expenses and French R&D tax credit – Read article
Brexit – New ways of business for intragroup relationship – Read article
Brexit – New ways of business for representative offices – Read article

For more information: