2020 has certainly been an eventful year so far. Brexit got done; the transition period got going; hurricane-esque storms brought travel chaos and now we can’t travel at all. Covid-19 is threatening the very existence of some businesses and creating even more uncertainty than many of us thought possible.
Staying safe has become the number one priority and rightly so. We hope you, your family, your colleagues/friends are all safe and well and remain so. In real terms, nothing else matters right now.
It seems slightly insensitive but we need to talk about Brexit. As we write, the transition clock is still ticking and we are still preparing for December. Government are still pushing ahead and the planning teams are still planning. Will the transition period be extended? Hard to say. Boris has said no. According to the Withdrawal Agreement, he has until the end of June 2020 to decide. It seems likely that some form of extension will materialise but it is not black-and-white. There are options…
Considering nothing but trade for now, there are two key elements:-
– Tariffs (duty)
– Customs/border processes
Both appear to have a ready-made ‘get out of jail’ card and perhaps this is why Boris is not rushing to extend the transition period.
Under the WTO rules, two contracting parties in meaningful negotiation can suspend tariffs until those negotiations are concluded (without breaching Most Favoured Nation rules). This suspension can last up to 10 years! This is known as GATT art. XXIV. It was wrongly touted as a solution to ‘no deal’ but it is a genuine and viable option for the future relationship. GATT art. XXIV requires both parties to approach the WTO, in a no deal scenario that was unlikely, in the current situation it is far more likely.
GATT art. XXIV has the ability to suspend tariffs but not processes. This is where, we think, an implementation period has a role to play. (the phrase seems to have been mothballed for now) Sure, paperwork and process will start. It will be decided what that looks like by December and you will have an implementation period to get ready for it. This is only our opinion but the indicators seem to be pointing that way. It was a similar situation, for example, when Spain joined the EU. It was NOT an overnight change, but a gradual accession. (I am old enough to remember!) Brexit should be a gradual regression of EU conditions rather than a crash-bang change. It suits UK and EU better that way.
So, what is the Consortium up to? Actually we have never been busier. We have been pushing ahead with RPA (Robotic Process Automation) and have already submitted our first automated Customs entries. We have developed mapping tools to define processes by route, we have defined the data elements required for the RPA process and we have done some sterling work on swim lane procedure mapping. We have also developed online tools for critical data capture and three options for the load data to be shared quickly and easily.
We have also written a user guide which will allow you to (a) understand the process fully and (b) set-up your systems so that load data is ready to share. We have also introduced the concept of CCC VIP status, giving fast-track access to Customs processes and reduced documentation fees. It is an important topic so we have recorded a webinar which can be found here: https://www.youtube.com/watch?v=1QYqQwcn0D8
We will continue to work towards 31st December 2020 as the start date and will keep you updated as we go. Should you require any further information at this stage just ask. Please do download the user guide as we think this will answer many of your questions. www.mybrexit.uk/downloads
Stay safe.
Robert Hardy, Commercial Director, Oakland International/Oakland Invicta