In a week when the two candidates for the Tory leadership making their pitch to be the next prime minister left the fate of the Irish border in limbo and said the so-called ‘backstop’ was now dead, business owners across the UK and the wider EU were still left scratching their heads about what exactly will happen as the 31 October deadline approaches.
Boris Johnson and Jeremy Hunt have expressed opposing opinions on the terms of Brexit, meaning there is still huge uncertainty about what will happen. All the while, the clock is still ticking. The question remains of how business leaders that import and export in the EU can prepare so as to cause minimum disruption to their operations.
Is a no-deal Brexit on the cards?
The first thing that business owners both across the UK and the EU should be fully aware of is that a ‘no-deal Brexit’ is still a distinctpossibility. Despite very real warnings about what this could do for the economy, the favourite to be the next prime minister, Boris Johnson, has vowed to leave the EU on 31 October “come what may.”
Mr Hunt’s approach has been somewhat softer, claiming that should he be appointed prime minister, he would decide by the end of September whether there is a “realistic chance” of reaching a new Brexit deal with the EU before the looming deadline. He promised to deliver a provisional ‘no-deal Brexit’ budget in early September before giving the EU three weeks to make a decision.
Taking this into consideration, businesses of all sizes and across all industries should consider taking steps to prepare for a ‘no-deal Brexit.’ Those businesses involved in an international supply chain - particularly those trading across the EU - should make a conscious effort to ensure this supply chain is prepared for the very real possibility of the UK leaving the EU without a deal in just three months’ time.
Preparing for every eventuality
Over the past 12 months, we have handled a record number of cases from import and export firms in the UK that are frantically seeking advice due to the uncertainty over when and how we will leave the EU. During this time, companies rushed to ensure compliance with HMRC regulations ahead of the initial 29 March deadline, and more recently businesses have scrambled to make preparations for the eventuality of a ‘no-deal Brexit.’
Businesses involved in the supply of goods to and from the EU are advised to consider applying for Authorised Economic Operator (AEO) status, which indicates that their role in an international supply chain is secure. Applications for AEO status have seen a significant increase over the past 12 months, as companies look to minimise the impact of Brexit and any potential delays at ports.
All imports businesses should also register for Transitional Simplified procedures as a matter of urgency. The scheme is available free of charge and allows goods to pass through customs more quickly when Brexit finally takes place.
As a ‘no-deal Brexit’ becomes increasingly likely, pioneered by Tory leadership favourite Boris Johnson, businesses are no doubt worried about what the future holds, as this time of uncertainty rambles on.
It may be tempting for business owners to try to continue in blissful ignorance of the difficulties that approach, however, switching off from Brexit will not make the issue go away. October is fast approaching, and while we may not know the exact terms of how the UK will leave the EU, enterprises should try to have all their affairs in order and plan for a ‘no-deal Brexit.’
David Miller is a Customs & AEO Consultant and the co-founder of The Customs People
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