Time has just about caught up on businesses that have not yet prepared for customs.
On the 31st of December, now just weeks away, the UK will finally depart the EU. Brexit is about to become a reality.
For Irish businesses sending goods to, from or through the UK, the immediate impact will be the introduction of a new customs regime.
Unfortunately, some businesses are still, even at this late stage, unprepared.
“There are some worrying signals,” says Giles O’Neill, manager of Enterprise Ireland’s Brexit Unit.
A new Enterprise Ireland survey has found that while customs is a recognised priority among respondents, more than 40 per cent of companies have still not decided how to pay customs charges. More than 30 per cent have not yet figured out who will manage customs procedures.
Just 42 per cent feel they are significantly or fully ready, while one in five say they are still figuring out priorities.
Analysis of Enterprise Ireland’s Brexit Readiness checker tool shows 50 per cent of companies have not decided who will manage documentation and procedures when their goods arrive in the UK, and just under a third have still to decide whether to manage customs procedures in-house or through a broker or other intermediary.
But he is now urging all businesses that have not yet done so to take the requisite steps - and fast.
That means getting their EORI (Economic Operators Registration and Identification) number from Revenue. It takes just five minutes to do online and is essential, yet to date only 77 per cent of companies surveyed have done so.
Even fewer, at 37 per cent, have determined the commodity codes for their products. “But if you don’t have them, you can’t give them to your freight company, the people you expect to get your goods off the island,” he explains.
If your freight company is not asking for a lot of data from you, there is something wrong
If you haven’t done so, now is the time to figure out who is going to manage customs procedures and paperwork for you, whether in-house – which will require training up or hiring of staff – or via a broker.
“Decide who is going to do your customs declarations, in order to get the goods off this island and received into Great Britain.”
Decide too how you are going to pay customs duty. There are both deferred and pay as you go options, but if you go for the deferred scheme, you’ll need to have an account with Revenue, so sort that now, he urges.
Freight and logistics companies will be under pressure so the sooner you talk to them, the better.
Don’t be satisfied with simple assurances. “If your freight company is not asking for a lot of data from you, there is something wrong. Businesses will need to have detailed conversations with the people who provide the service,” he cautions.
Enterprise Ireland’s Ready for Customs grant can help by providing financial assistance to cover the costs of taking on additional customs clearance staff. This is relevant for all companies and specifically those in the haulage, freight and logistics sector.
It is worth up to €9,000 per employee, but you need to act fast here too as it is a limited scheme of up to €20m. “It’s finite so people need to get their applications in,” he confirms.
Emerald Freight Express
Emerald Freight Express availed of Enterprise Ireland’s Ready for Customs grant to expand its team, in readiness for December 31st.
“We’re a one-stop-shop for air, sea and road, import and export, including warehouse and 3PL or ‘third party logistics’,” explains Anna Barden, its financial director.
The business, which has been in operation for nearly four decades, has been a certified Authorised Economic Operator (AEO) since 2011 and is a trusted provider of freight forwarding services, helping its clients to ship their goods around the world.
It has invested in new personnel, office space and IT systems, to ensure it offers a premium service to new and existing clients post Brexit. Much of its time has been spent in recent months helping businesses to determine the decisions they need to make about customs.
“Unfortunately, this has been a very challenging year for all of them because of Covid-19, but it is important to stay focused and put the right processes in place. There is still a little window of time in which to do it but everybody needs to have their house in order before December 31st,” she explains.
She too urges companies who have not yet done so, to have detailed conversations with their logistics partners.
Businesses need to have the customs piece sorted out. It's not too late, but it nearly is
“A quick phone call is not sufficient, and no SME should rest assured that they are Brexit-ready if that is the only contact they have had with their appointed forwarder or customs broker,” she warns.
“For Emerald Freight, it is very important that we have full visibility on the client’s supply chain, how it runs, the products moving and the contacts required.”
It requires written standard operating procedures (SOPs) to be in place for clients, to ensure operations between all parties involved in the movement of goods is as smooth as possible.
Any business importing from the UK, and which has appointed a customs agent in Ireland, should be asking whether they are AEO certified, whether they can offer the use of the Deferred Account and what are the terms and charges for this facility, she advises.
“They also need to ask the agent if they have the team in place required to handle the volumes, do they offer compliance checks and audit assistance, what reporting will be provided and what reporting does the SME require,” says Barden.
Some friction is inevitable come January 1st, but port delays and lorry queues are a luxury you won’t even get to fret about if you haven’t sorted out your customs, because “your goods aren’t going anywhere”, says Giles O’Neill.
“Businesses need to have the customs piece sorted out. It’s not too late, but it nearly is.”
“At this stage businesses need to focus on the essentials. Secure your EORI number, determine the commodity codes for your product, identify who will manage your customs procedures and how you will pay customs charges.
With these actions completed businesses can successfully navigate the major changes to trade with Great Britain that will be a reality come January 1st, 2021.
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