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Brexit - proof of origin decides on duty rate

BREXIT since 2021 new trade agreement

New trade agreement between the UK and the EU starting 01.01.2021

The United Kingdom (UK) is no longer member of the European Union (EU). After 4.5 years of negotiations, the EU and the UK have agreed on a trade and cooperation agreement (EU-GB trade agreement). The trade agreement has entered into force  since 01 January 2021.

What does the trade agreement imply for the movement of goods?

Customs declarations must be submitted for cross-border goods traffic with the UK since 01.01.2021. For deliveries between Germany and the United Kingdom, the preparation of export and import declarations will become mandatory, similar to goods traffic with any other third country.

Exception Northern Ireland

An exception is made for goods traffic with Northern Ireland. Here, only the new country code XI has to be reported for  intra-Community trade statistics. In addition, no customs declarations have to be made, although Northern Ireland, as a part of the United Kingdom, is also no longer a member of the European Union.

Details on how to use the new country code XI can be found here

Zero tariff between EU and Great Britain

The trade agreement maintains a "zero tariff" (zero tariff rate) between the EU and the UK. However, this can only be guaranteed if the necessary rules of origin are met. Import VAT is to continue to be charged. The customs declaration now required is also intended to guarantee existing, country-specific restrictions and all related licenses.

How are the rules of origin met?

Despite the "zero tariff", trading companies will have to go through a considerable amount of paperwork in order to benefit from it. Indeed, the preferential tariff rate can only be claimed if the country of origin has been declared with evidence in the detail.

The preferential tariff rates only cover goods which have their origin in the EU or Great Britain as export country, see EU-GB trade agreement chapter 2 appendix ORIG-2. All other goods are subject to customs duties. In both cases, the goods must be tariffed to determine the duty rate.

How to benefit from Brexit?

Both sides, the UK and the EU, agree that the trade agreement will secure an extended free trade agreement and thus provide a basis for ongoing cooperation. For importing and exporting companies, however, the trade agreement represents an time-consuming, bureaucratic effort. Proactive action, organization and preparation are required.

Benefit from the full service of eDOC AS:

Customs tariff classification
The specification of the respective customs tariff numbers is obligatory for every goods with every customs declaration, now also in the goods traffic between the EU and Great Britain.

Preference calculation and proof of origin of goods
Input materials from the UK lose their preferential origin with Brexit. The preferential origin of the final product must therefore be recalculated.

Request and organize supplier declarations
Supplier declarations are the basis of the preferential origin calculation and may need to be requested and organized again.

Classify goods for export control
Export control-relevant goods must be identified and licensed in goods traffic between the EU and the UK since Brexit. 

Update and maintain foreign trade master data
Correct goods classifications and tariffs are based on updated and maintained foreign trade master data.