Brexit transition: time is running out
At the end of transition period, the UK’s relationship with the EU will be determined by the new agreement it has negotiated with the EU on trade and other areas of co-operation.
The Withdrawal Agreement specifies that the transition period will last until 31 December 2020. The post-Brexit transition period will not be extended, Downing Street says, despite growing calls for the deadline to be pushed back so the government can deal with the current travel chaos caused by a spike in coronavirus cases in the UK.
With just days before the UK leaves the EU’s single market and customs union, negotiators on both sides are working around the clock to break the Brexit deadlock.
The European parliament has already said it is too late for it to hold a vote of consent on any deal. The member states would probably seek to “provisionally apply” the deal on 1 January, with MEPs voting later in the month.
In a no-deal scenario, the UK would have to rely on previous international conventions for security co-operation and would trade with the EU on World Trade Organization terms. The exception in both these cases is Northern Ireland, whose trade in goods with the EU would be covered by the provisions in the Northern Ireland protocol.
Even without a deal, the UK would continue to follow the EU rules transferred into UK law through the EU Withdrawal Act 2018. At the end of transition period, the UK would be able to diverge if UK courts decided to interpret existing EU law differently or if the government introduced changes into UK law, according to the Institute for Government.
Tracey Hughes, managing director of leading ingredients distributor Henley Bridge, says the company has endeavoured to cover every element of risk in the event of a no-deal Brexit to protect its customer base as much as possible. In addition, she says, it has brought new suppliers on that can offer cost engineering products for 2021, and further NPD is planned for the first quarter.
“We have been continuously planning for Brexit and have contingency plans in place to keep any disruption to a minimum. For example, we have multiple hauliers set up to do our European collections and have also asked them to go into different ports, such as Southampton and Portsmouth, rather than just Dover.
“We also have access, via our group, Kent Foods, to a depot in Holland to ensure supply in the event of any logistics issues."
In the event of a no-deal Brexit, Hughes says the Sussex-based company has worked religiously with its suppliers to make sure all paperwork, including quantity codes and tariff charges, is correct.
"Because our product range is so vast, the extent of tariff charges could be quite significant, so today (December 22) we placed our first orders as a dummy run before December 31 to make sure all of the paperwork comes back and everything is in place."
In relation to the travel chaos at UK ports this week, Hughes says over the last two months Henley Bridge has been building stock significantly - but with an upturn of sales in the run-up to Christmas it has had to continually replenish.
“After a lot of thought, we have turned off export on our website from today. We have written to customers to explain the reasons for this suspension, and it doesn’t affect any of our UK customers.
“We haven’t encouraged customers to stockpile in the event of a no-deal because of their cashflow, and we are not looking to impose tariffs until 1 February," says Hughes.
Julianne Ponan, founder of Creative Nature Superfoods, says her firm has already taken action to prepare for the end of the transition period on 31 December, and she’s now calling on others to do the same.
“There are some straightforward actions that businesses can do to prepare, such as making sure you have an Economic Operators Registration and Identification (EORI) number, which is very important for imports and exports.
“We have also been looking at whether changes to the labelling of goods will impact us and whether there are any extra certifications we will need.”
Creative Nature Superfoods, was established in 2012 and has grown into a multi-award winning ‘free from, vegan and wellness food’ brand, developing a range of snacks, sweet treats, baking mixes and superfoods.
With a nine-strong team based in Surrey, the company exports to over 14 countries across the world
“We would really recommend that all businesses look at the GOV.UK website, which we use to check for the latest updates,” Ponan says.
A spokesperson for confectionery multi-national, Nestlé says the company has been following negotiations between the UK and EU closely since the referendum and continues to prepare for all possible scenarios.
“Nestlé has a sizeable manufacturing operation in the UK and that two-way trade with Europe is why we would like to see a trade agreement that creates minimal disruption for businesses and customers. Maintaining supply is a priority and, with stock building more difficult at this busy time of year, it will be important that the flow of both ingredients and finished products continues as smoothly as possible after 31 December.”
- The UK’s Department for Business, Energy and Industrial Strategy, continues to update gov.uk/transition with vital information to help companies understand the important actions they need to take to be ready for the start of 2021. Use the GOV.UK checker tool to generate information tailored to your business, and to sign up for email updates.