Brexit agreement begins now: Are you ready?

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Brexit agreement begins now: Are you ready?

December 30, 2020
Business Affairs European News

1. You should have a plan for expected delays and extra paperwork to meet customs formalities checks and controls.
As of January 1, 2021, customs requirements will apply for medical equipment entering the territory of the European Union or leaving the European Union for the United Kingdom. Even though the Agreement establishes a free trade area providing zero tariffs and zero quotas, all products traded between EU and U.K. will be still be subject to regulatory compliance checks and controls for safety and health.

No one really knows at this point if this customs process will be seamless and speedy. It will be important for you to consider that delivery schedules will be impacted, and you should now be thinking more comprehensively about what you may need to change in your standard contracts and more particularly, the supply chain impacts.

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“Particularly when involved in the shipping out of MRs, you want to anticipate possible delays in your logistics,” cautioned Harry Khabra, managing director of U.K.- and Spain-based Vertu Medical. On the whole, Khabra was optimistic about sorting and transport issues, adding: “we are about giving value-adds when we make a sale, and clearing these logistical issues will be just another part of the risk analysis."

2. Know your custom documentation requirements.
This is a good point to begin figuring out the details of the U.K. and EU customs requirements. Under the Agreement, fees and other charges imposed in connection with importation or exportation will be limited to the approximate cost of the services rendered, and not represent an indirect protection of domestic goods or taxation of imports or exports. Both the U.K. and the EU have promised to promptly publish all fees and charges they impose in connection with importation or exportation via an official website. The information will include the reason for the fee or the charge for the services provided, the responsible authority and how payment should be made.

3. Expect the backlog, particularly for road and sea traffic.
For some EU and U.K. businesses, complying with these customs formalities will be a relatively new experience. Several experienced shippers have noted that we can anticipate, at first, some delays at the borders which could cause delays in importing. It will be important to know about your time frames for deliverables and whether you have agents in place to satisfy the custom formalities. As Christian Frandsen predicts: “each individual firm will be spending more time on trade compliance, as there might be a lot of obstacles on the export/import procedures.”

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Wayne Webster

Good article. Skip at your own financial peril.

January 04, 2021 10:38

This is a well written article and should give medical device companies pause as they consider the potential for additional expenses and delays with these new rules. Unfortunately, most learn by failing and emptying their bank account. An economist several decades ago encapsulated the problem very well. He said, "Most organizations continue to implement solutions for problems they no longer have." In other words keep acting as if the EU hasn't changed and it will cost you dearly.

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