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Bidfood on Brexit – End of the Transition Period

 UK and EU Markets

 

On the 31st December, the transition period ended and at 11.59pm the UK left the EU Single Market and Customs Union and all the new EU policies and regulations came into force. The UK now has an ‘agreement in principle’ in place with the EU which includes a trade deal. Whilst this avoided a hard exit, and the associated duties and tariffs on imported and exported goods, the deal will bring with it significant changes and as these play out. As a country we are likely to see some continued disruption or as key government ministers quote “some bumpy moments”.

 

So what elements will change that affect imported products?

From 1st January, the UK and the EU are now two separate markets (from a regulatory and legal point of view) which creates barriers to trade in goods and services, and in cross-border mobility, in both directions.  As a result, customs checks, controls, paperwork and procedures will apply to exports and imports.

The new deal however, creates a free trade area which provides for zero tariffs and zero quotas on all goods; imports and exports between the UK and EU. However businesses must prove that their products fulfil all the necessary ‘rules of origin’ requirements, which can be self-certified. This leaves room for change and flexibility which will be needed in the coming months.

Under this new deal any customs procedures are now simplified; this does not mean it will get easier. Because of this all goods from the UK will require new checks and controls no matter what. These new controls depend on the tier of goods being traded, if they are ‘low-risk’ it’ll be minimal whereas meat products will require checks on identity, health, origin and safety to be met to a satisfactory standard.

Due to the timing of Brexit we will not fully understand the implications of these new rules and policies. With the full agreement document spanning over 1,200 pages some elements require even further negotiation when the time comes. All of these new procedures will require more time, resources and costs to all suppliers.

Luckily for Bidfood customers many plans and assessments have been in place since the beginning of the negotiations. By risk assessing, stockpiling and route-planning as a company they have mitigated most possible impacts on day-to-day consumers. Many key products (particularly in the frozen and chilled sector) have either been stockpiled or given a British/Local alternative. Meaning that for now any impact will be minimal to customers. Whilst there may be some unforeseen implications that emerge as the details of the full agreement become clear through the year it is important to know that every business will have to adapt to a new climate.

 

All information taken from Bidfoods’ latest customer update and The Border Operating Model which can be accessed here.