In the third of our ‘Can Do’ blogs, Managing Director Ian Jones explains how Warrant Group has helped businesses get to grips with Brexit customs procedures – and how automated data sharing solutions are the way forward.
It was June 23rd 2016 when the UK voted to leave the EU.
I remember waking up the following morning and seeing the headlines and thinking ‘wow, we are going it alone and this is going to completely change how the UK will work with EU Countries’.
It was clear to us that businesses would need to appoint a Customs Broker for when we finally left the EU, and it was from that moment that we started to think how we could help our clients and prospective clients that have never handled these processes before.
The official withdrawal process commenced on 29th March 2017, meaning the UK would leave the EU on 29th March 2019, which was subsequently put back twice until a final leave date of 31st January 2020.
I mention these dates as there has been a lot of negativity around not having enough time to plan for the new legislation rules from a logistics perspective.
Customs Brokerage is part of our service offering and we knew from the outset that there would be a requirement for a Customs Declaration to be completed at border locations in the UK and EU 27 and for duty and VAT to be payable.
Despite not knowing the full criteria, we had the knowledge and our strategy was to talk with clients and prepare for a worst-case scenario.
Our approach was to establish from clients which Incoterms they used to purchase products from their suppliers and if those Incoterms would work post Brexit.
The Incoterms determine contractual responsibilities of our client and their suppliers from purchase price to transport through to customs obligations and payments.
With this knowledge, we identified which clients had to make the necessary HMRC applications to trade between EU-GB in the form of EORI, Deferment and VAT (PVA) registrations to ensure their readiness.
As a business, we did not use the transition period offered by Government because we felt there would be an unsustainable backlog of administration work in issuing Supplementary Declarations post UK arrival based on client volume predictions.
Instead, we implemented the Full Pre-Lodged Declaration Model from the outset.
This meant that on inbound shipments from EU 27, we completed the full Customs Declaration prior to the goods arriving at the border location in EU 27 and for outbound shipments from UK, completing the full Customs Declaration when loading the products at the load site.
Document/Data information requirements and processes were agreed with each client whether by manual or automated processes. We ran a test programme initiated in November and December 2020 to confirm Customs Declarations were submitted correctly.
Prior to the start date of 4th January 2021, the Government announced it had reached a Free Trade Deal with the EU which resulted in most product ranges moving Duty Free.
This did not affect anything we had put in place as per our strategy; it meant that our Customs Declarations were submitted with no Duty payable where applicable.
All but one of the UK Ports offered a mixed model in relation to declaration types namely Pre-Lodged or Temporary Storage.
Warrant Group had decided to implement the Pre-Lodged model and subsequently found that several haulage suppliers and ferry operators were working on a Temporary Storage Model (Inventory Linked) which meant that we had to adjust our processes.
As an International supply chain business, we clear shipments through Inventory Ports daily and the findings above meant having to claim UCN’s per shipment prior to clearance procedures for the EU-GB movements as per our current Rest of the World portfolio. This was implemented swiftly and without delay to our clients.
Moving forward we continue to plan our GVMS (Goods Movement Vehicle System) solution for supplying clients and hauliers with time sensitive cleared Customs Declaration information prior to Port of Exit departure. We have noted the recent announcement by the Government of a delay in the GVMS roll out to 1st January 2022.
Our work on CDS (Customs Declaration Service) will also continue as we wait for further Government updates on whether it will be implemented from July 2021 in full or whether it will be delayed, meaning CHIEF (Customs Handling of Import and Export Freight) will continue as the portal of use.
It has been a challenging few years of getting to grips with Brexit Customs procedures and requirements mainly because of the late notifications from the Government on key cross border issues because of their failure to agree a Brexit deal until late 2020.
We have successfully implemented both automated and manual customs solutions for our clients and have had positive feedback on performance.
Automation is at the heart of our business now and we will continue to engage with clients and discuss automated data sharing solutions.
This makes us efficient, allowing us to complete Customs Declarations faster with less touch points.
We have an exceptional team here at Warrant Group. We are extremely proud of our people; they are the heartbeat of our company and the reason why our business continues to grow year on year, and I thank them all for it.