Brexit and its consequences
for the logistics sector

March 1, 2021

The United Kingdom (UK) is out of the European Union (EU). After difficult negotiations lasting more than 2 years, the UK officially left the EU on January 31st 2020. Since then, the UK and the EU have long negotiated the future relationship that entered into force on January 1st 2021. Negotiations have been difficult and, in the end, they ended in a limited agreement.

The United Kingdom is no longer part of the internal market and the customs union. However, as a result of the trade agreement, there are no quotas or import tariffs on products that cross the Euro-UK border. There are exceptions to zero rates for goods containing parts that are not made in Europe. That does not mean that trading will run smoothly as before. British and EU member state exporters must take into account product controls, veterinary controls for animal products or racing horses, customs controls and formalities. This hassle increases the chance of longer waiting times at the border. In this regard, the Brexit agreement tries to limit the bureaucracy: the EU and the UK will recognize each other’s “reliable traders”, for whom customs procedures can be a lot simpler and faster.

From now on, VAT must be paid on imported products. Imports of alcoholic drinks and tobacco from the UK are subject to excise duties, including on online purchases. Moreover, goods traded across the Channel must comply with social and environmental measures in the UK and the EU. All this implies that there are quite some consequences for the logistics sector as now customs
procedures will again apply to the import and export of goods. But how can you best deal with these formalities and paperwork? We are happy to help you map out your logistics chains and the influence of customs formalities.

Contact us for further assistance.

For a more in dept overview, click here to read our Brexit Guidance Advisory.

Did you know?

The first ever ‘cargo only’ flight was recorded in November 1910 in the USA, using a Wright Model B aeroplane that flew 65 miles carrying a package of silk. The business owner used the pioneering transport more as a PR stunt to celebrate the opening of his store, with the bundle of silk cut into individual pieces and glued onto souvenir postcards.

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