Hello, David here once more.
Version two of the government’s Border Operating Model was released on Thursday 8th October.
Despite its mind-numbing length – 271 pages – I have to give credit where it’s due. It is rather a better attempt than in its first iteration.
That said, there are still areas open to question and it does make it clear further updates will be published.
My brief notes follow. Apologies for the length of this post, but I am sure you’ll agree it’s better than wading through the treacle of 271 pages.
I hope you find this helpful. Please feel free to contact us – the Model does strongly recommend traders appoint a Customs intermediary owing to the complexity of the requirements.
We can be reached at:
The Border Operating Model version two.
Everything, or at least most, of what you need to know is in The Border Operating Model. Version 2 of this document was published on Thursday last week – link is below. Further changes and updates are expected, so it’s a bit of a moving target.
You will need a UK EORI. If you haven’t got one already, you can apply at the following:
Customs declarations will be required irrespective of the result of any trade deal between the EU and the UK.
Incoterms – you should consider the Incoterms agreed with you suppliers on import and customers on export. We are not recommending the use of DDP terms. Even if the agreed terms make it clear which party is responsible for Customs clearance costs and taxes, we suggest you revisit this topic with both suppliers and customers. There has been no clearance for intra-EU movements for so long that not doing so could lead to disagreement and delays.
All movements will need a commercial invoice detailing commodity codes, country of origin, Incoterms, value, currency, importer, exporter and a plain language description of the goods.
Clearance at an approved inland site – as opposed to the frontier – will require a ‘T form’ under the ‘Common Transit Convention’ with a suitable guarantee to Customs. Carriers opting for inland clearance may not have access to a T form guarantee and therefore run into problems. Inland clearance is also beset by draconian Border Force measures, double handling, delays and additional expense. It can easily be envisaged that inland warehouses will very quickly become gridlocked – warehouses don’t have elastic sides. For clearance at the frontier a new ’Pre-lodgement’ scheme for roll on roll off [RoRo] ports – including the Channel Tunnel – avoids the need for a T form. Pre-lodgement effectively means raising the import declaration before the goods are boarded at the port of export.
GVMS is a new IT platform linked to UK Customs software which will be required to be used by the haulier before arriving at the port of export. A unique Goods Movement reference [GMR] must be generated, without which the load will be refused boarding. The GMR links all the supporting documentation together for all consignments on the transport unit into a single unique reference, including the truck [if there is one] and trailer numbers.
EU ports will operate their versions of GVMS and the haulier must also complete these before attempting to cross the Channel. In France this is ‘SI Brexit’, in Belgium ‘RX Seaport’; in the Netherlands ‘Portbase’, in Spain ‘Teleport 2.0’ and in Eire ‘AIS’.
Goods from the UK going to Northern Ireland will need an import declaration when arriving into Northern Ireland [after 1.7.21 possibly under GVMS whilst the goods are crossing the Irish Sea]. The government has created a new ‘Trader Support Service’ [TSS] to assist with this new requirement.
Wooden packaging and pallets must be heat treated to ISPM15 standards. This applies not only to exports to the EU but also for imports to the UK. Considerable fines may be applied to traders not following this requirement.
Traders are strongly recommended to appoint a Customs intermediary to complete declarations on their behalf.
Imports into the UK
Import controls will be introduced in three stages on 1.1.21, 1.4.21 and 1.7.21 respectively.
From 1.1.21 until 30.6.21, it will be possible, but not mandatory, to delay import entries for ‘standard’ goods until up to six months after the cargo arrives. To do this you or your Customs intermediary must be SDP authorised and hold a duty deferment account. Hellmann has these in place already and could provide this service. If you import ‘controlled’ goods, these must be declared at the time the goods first arrive. The list of controlled goods is in appendix C of the Border Operating Model, a link to which is above. You may opt for clearance at the frontier at the time of arrival.
From 1.4.21 various further controls will be introduced for sanitary and phytosanitary goods [food, feed, goods of animal and plant origin].
From 1.7.21 full import, Customs declarations will be required at the time of import. An import safety & security declaration will also be required. This latter is the legal responsibility of the haulier or shipping operator if the trailer is not accompanied by a driver. GVMS will become fully operational and Pre-lodgement will enable Customs import clearance to be completed whilst the vehicle is crossing the Channel. Alternatively, goods may be cleared under ‘Temporary Storage’ at an approved inland site or sent under transit to Eire where appropriate.
Customs duty – the UK will have a new ‘UK Global Tariff’. This describes Customs duty rates which will be applied from 1.1.21 on all imports. You can use the lookup tool to check the rates applicable to your imports. Even without an EU-UK trade deal, some rates are less than the WTO maximum and many are set at 0%. Here is a link to the UK Global Tariff:
VAT – from 1.1.21 optional ‘postponed VAT accounting’ will apply to all imports. This is where the importer accounts for VAT via their quarterly VAT return. Unless the importer is not VAT registered, no VAT will be payable at the time of import unless the importer chooses not to take advantage of postponed accounting.
Special arrangements will exist for low-value consignments not exceeding £ 135.
Exports to the EU
Full controls will be in place from 1.1.21 onwards. This seems to include the need for an EU import safety & security declaration. GVMS will be operational but for Pre-lodgement of EU import entries only.
No cargo may be loaded for export where an export declaration at ‘Permission to Proceed’ [P2P] status hasn’t first been obtained from the Customs export software platform. Hellmann can achieve P2P for you if required.
Hauliers will have to complete an entry into the snappily named ‘Check an HGV is Ready to Cross the Border Service’ [previously called Smart Freight Service or SFS]. The haulier must generate a Kent Access Permit from this service by using an App on a smartphone. No permit would render the driver liable to delays in Kent and a fine up to £ 300.
Goods may need a T form to cover onward transit in the EU.
Current EU Customs duty rates can be found in the EU tariff, a link to which follows:
Imports into the EU will be liable to the VAT rate in force in the member state of consumption. Note that EU VAT rates vary from state to state.
All wooden packaging and wooden pallets must conform to the ISPM15 standard, both for imports into the UK as well as exports to the EU.