What will be the Brexit implications for your supply chain?
EU Versus Global Supply Chains - Immediate Steps
Developing a Brexit Strategy - Longer Term Planning
Boost the utilization of your HCL environment by reevaluating use cases and f...
Brexit Supply Chain Steps
1. BREXIT –
TRADE AND SUPPLY
CHAIN IMPLICATIONS
WHAT WILL BE THE BREXIT IMPLICATIONS FOR YOUR SUPPLY CHAINS?
EU VERSUS GLOBAL SUPPLY CHAINS –
IMMEDIATE STEPS
Brexit will impact all UK businesses, but some more
than others. Those with solely UK-EU supply chains, or
little direct experience of dealing with imports/exports,
will face a number of new regulatory requirements and
challenges. However, all businesses should be taking
steps now, as a priority, to ensure that they are
prepared for Brexit. These include:
Registering with HMRC to act as an importer
from/exporter to the EU and obtain an EORI number
Applying to HMRC to operate a customs duty
Deferment account to defer the payment of duty
and obtain cash flow benefits
Confirm the level of customs knowledge within the
business and determine if training is needed to
avoid financial penalties as a result of legislative
non-compliance
Review in-house systems, procedures and customs
data to ensure that they can meet the new
regulatory requirements
Review contractual arrangements with suppliers and
customers to identify responsibilities between
parties for cross border movement of goods, eg are
you responsible for taking your goods all the way to
your EU customer’s site?
Confirm the capabilities and limitations of your
services providers in the supply chain.
DEVELOPING A BREXIT STRATEGY –
MEDIUM AND LONGER TERMS STEPS
A Brexit strategy should address the following:
What is the likelihood of additional freight and
clearance costs to move materials and goods?
Will your supply chain require your business to
register for VAT in other countries?
Are your current procedures and controls sufficient
to ensure that your business is operating
compliantly and can take advantage of duty reliefs?
Can you identify potential areas of increased
costs/indirect tax liability in your supply chain?
Would duty reliefs and simplifications (such as
customs warehousing) be advantageous to your
business to minimise any potential cost increases?
Would your business benefit from becoming
accredited as an Authorised Economic Operator
(‘AEO’) to obtain further supply chain and financial
benefits, such as:
– Fast track clearance through border controls
– Ability to continue to use the EU VAT
reverse charge mechanism in the future in
a ‘no Brexit’ scenario
– Faster application process for duty reliefs
and simplifications
– Mutual recognition for exports to other global
trade partners (such as the USA) resulting in
lower broker costs
– Reductions/waivers in financial guarantee levels
to cover duty/import VAT incurred.