Brexit: EU Draft Withdrawal Agreement
On 28 February 2018, the Commission published a Draft Withdrawal Agreement concerning the Brexit negotiations. According to the Commission, this text translates into legal provisions the commitments that have been agreed between the EU and the UK so far. It covers citizens’ rights, ongoing customs procedures, ongoing VAT and excise duties matters, transition period as well as a Protocol on Ireland/Northern Ireland, among other issues. It is important to note that this document is a draft prepared by the European Commission’s Task Force 50 so the wording has not been agreed with the UK. The EU will present this document to the UK government for future discussion.
With regards to ongoing customs procedures, the Draft Withdrawal Agreement highlights the principle that the Union Customs Code (UCC) shall apply to movements of goods between the customs territory of the EU and the customs territory of the UK, whenever the movement started before the end of the transition period and ended thereafter. Moreover, the UCC shall continue to apply to non-Union goods which were placed under a special procedure in the customs territory of the UK, before the end of the transition period. For example, after the UK leaves the Union, non-Union goods placed in a customs warehouse in the UK would still be subject to the provisions of the UCC, provided that these goods entered into the customs warehousing procedure before the end of the transition period. The UCC would be applicable until the situation or customs procedure is ended or discharged. The provisions on the transition period (Part 4 of the Draft Withdrawal Agreement) confirm that the Union acquis remains applicable in the UK during the transition period. Finally, on the border of Ireland/Northern Ireland, the Commission’s text proposes a “common regulatory area” if no other solution is agreed.
The clock is ticking
The publication of the Draft Withdrawal Agreement by the European Commission shows how urgent it is to set clearly where we’re heading in the Brexit negotiations. In this context, it is essential that businesses follow closely the developments in the negotiations and prepare an impact assessment to establish the risks and opportunities. Customs4trade’s team of experts can assist you with the preparation of this impact assessment, which would be the first step to determine the best strategy for your business. Moreover, Customs4trade can help you offset the increase of costs resulting from Brexit, through automation. Customs4trade has developed a tailored IT solution to automate customs formalities which is currently successfully employed in the UK.