All you need to know about the ‘no-deal’ Brexit papers
As you will have seen, on the 23rd August, the Government released the first set of Brexit technical papers, offering advice to individuals and businesses on what to do if no Brexit deal is reached.
Almost 60 more papers are expected to be released in the coming weeks; the first batch of 24 covers the Government’s plans for the following sectors:
· Applying for EU-funded programmes
· Civil nuclear and nuclear research
· Farming
· Importing and exporting
· Labelling products and making them safe
· Money and tax
· Regulating medicines and medical equipment
· State aid
· Studying in the UK or EU
· Workplace rights
Issues which are likely to involve a number of Euston Town businesses are outlined below. However we urge you all to review the notices related to your industry as a matter of importance. The full list of available papers can be found on this website.
On behalf of our members, Euston Town is liaising with the Mayor’s office to ensure that the needs of London’s businesses are recognised as the negotiations continue. We are also exploring options for SME training around Brexit, so please do let us know if this is something you would be interested in.
Trade
Supply chain disruption is likely to be the single biggest factor that may impact your business post Brexit. Without a deal, the free-circulation of goods between the UK and EU will cease.
Most business sectors will need to familiarise themselves with the import declarations, licences and paperwork. The Government has advised businesses to:
· Understand what changes in customs and excise procedures will be enforced
· Take account of the volume of their trade with the EU, and any potential supply chain impacts
· Consider their role in supply chains with EU partners
· If necessary, put steps in place to renegotiate commercial terms to reflect any additional costs via tariffs and customs
· Consider how they will submit customs declarations for EU trade in a ‘no deal’ scenario
· Register for the HMRC’s EU Exit update service
The technical notice provides detailed advice for those importing from, or exporting to, the EU and can be found here. Details about how to identify your goods and establish what duties and specific rules apply are available here. This is particularly relevant to businesses who trade predominantly with the EU, where the declaration process does not apply, and there are currently no tariffs on UK exports or imports to or from the EU.
Please also note that arrangements for trading to the Republic of Ireland and Northern Ireland are still to be confirmed.
VAT
HMRC announced that while the VAT system will have to be replaced for trade with EU and non-EU countries, any immediate changes will not be enforced at the border.
Instead, companies will be able to continue as present and account for the tax on imports/exports in their quarterly returns. However, this does mean that businesses will need to prepare for additional accounting if importing or exporting goods to or from the EU.
Further detail about VAT requirements for services, vehicles and the refund system are available here.
Personal finance
In a no-deal scenario, charges for using your credit card, debit card and digital payment services to buy something from a retailer in the EU may return. At the same time, transactions across the border may become slower as the financial services sector in the UK adjusts to being outside the EU’s payments system.
Medicines and life sciences
The MHRA will take on the functions currently undertaken by the EU medicines regulatory network. The MHRA will be consulting on the regulation of medicines in a No Deal scenario in early autumn, and as such, more comprehensive technical notice for the life sciences sector will follow after the consultation.
For now, the Government has announced that:
· Pharmaceutical companies will need to stockpile six weeks’ worth of medicines, on top of normal stock levels
· All medicines currently approved by the EMA will continue to be approved for use in the UK; in future, separate applications will be required to the MHRA and the EU, but these will be closely aligned
· The UK will unilaterally align to the EU/EEA exhaustion regime to ensure that parallel imports of pharmaceuticals can continue from the EU/EEA
· Regulations for clinical trials will continue as present, and the UK will seek alignment with the new Clinical Trials Register (CTR) when it comes into force
· Although the UK will require separate submission of regulatory information, it will continue to accept the same format as for EU submissions
· Provisions for batch testing will remain unchanged
Product labelling
Tobacco, e-cigarettes and organic food labels will have to be changed, with businesses no longer able to use the EU’s organic logo, or bank of images.
Additionally, those businesses whose goods are designated as ‘organic’ will only be able to export to the EU if the goods are certified by an organic control body recognised and approved by the EU. UK control bodies will need to apply to the European Commission for recognition, however they will not be permitted to make applications until March 2019, and approval can take up to nine months.
EU funded projects
Further information is provided about the previously announced Horizon 2020 underwrite guarantee, whereby the government will guarantee funding for successful, competitively bid-for EU projects submitted before we leave the EU, including Horizon 2020. This guarantee only covers UK organisations.
Current UK recipients of Horizon 2020 funding will soon be invited to provide initial data about project(s) on a portal hosted on Gov.UK. Recipients will then be contacted by UKRI to inform them of the next steps in the process to deliver the underwrite guarantee, if necessary.
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We appreciate that there is a raft of information that these technical notices do not cover, and many questions are likely to be posed to the government on these, after recess. We will continue to share information as and when it becomes available. Additionally, there are elements of the technical papers not covered in the above, including workplace rights, state aid for businesses and nuclear research. Please therefore ensure to check the relevant papers.
