Well, deadlines have come and gone. A flextension was introduced – producing another deadline – 31 October 2019, and in the middle of this, we have the political world spinning as the political world always does.
New leadership in the EU following the EU Parliamentary elections (which the UK had to participate in and sent a large number of Brexit party MEPs to the European Parliament) has led to a two-horse race to lead the Tory Party and the UK, with the contenders being Boris Johnson and Jeremy Hunt.
The rhetoric about a “no-deal” exit from the EU is increasing, with Boris Johnson being absolutely fixated with the UK leaving the EU on 31 October come what may and Jeremy Hunt, almost reluctantly accepting that a no-deal may end up being the only option. Boris Johnson has even suggested that he will “prorogue” (suspend to you and me!) Parliament should MPs try to block a “no-deal” Brexit, such is his fixation on the date of 31 October 2019.
Although “no-deal” is firmly on the table, the change in leadership in the UK and the EU might provide the opportunity for some kind of renegotiation (“what about?” I hear you ask, and to be honest, I have no real idea) that might result in the contentious issue of the Northern Ireland Backstop changing into something more palatable – allowing a deal to be agreed and a transition/implementation period to begin, with a sigh of relief from business!
We are still in that period of uncertainty that has been plaguing business since the UK referendum result was announced. If you take HMRC as the barometer of business engagement – public pronouncements on “no-deal” Brexit planning have all but dried up. What remains are the easements and changes that were announced earlier in the year.
But even those “easements” introduced by HMRC are not being taken up by business – the BBC discovered in mid June that, in respect of Transitional Simplified Procedures (an electronic declaration process that is aimed at relieving the bottleneck at border and allowing for electronic supplementary declarations to be submitted in-land, after the event) only 17,800 firms had applied for the TSP as of 26 May. That’s less than 10% of the total of 240,000 firms estimated (by HMRC) to require the status by 31 October, when the UK’s latest Article 50 extension is due to expire.
Be ready amid the confusion
It is unclear whether this inertia is due to a “wait and see” attitude or a failing in the communication process from the authorities.
Even where importers are trying to prepare themselves, it appears that blocks are being placed in their way almost at the last minute by the authorities – “no, it is our policy that non-established entities cannot be a depositor into a customs warehouse, even though you as the warehouse keeper will be jointly and severally liable for the tax.”
So what’s the lesson here?
- Don’t wait
- Plan for the worst
- Act now
- Talk to specialists
- Prepare, prepare, prepare
- Look at any preparation costs as an insurance premium – you don’t want to make a claim, but you need it in place if you have to
- Try not to trust politicians – they will only let you down in the end
And in terms of the politicians, I would like to quote one of the publicity tag lines from one of my favourite films, O Brother, Where Art Thou?
“They have a plan…. but not a clue.”
Lorenzo Rossetti is Business Product Owner, overseeing Customs solutions in the UK for BluJay. He has spent his entire career in the UK customs world, including 17 years as Customs Development Director for Grosvenor International, now a BluJay Solutions company. Lorenzo can be reached at +44 (0)1689 818000.