The UK is among the world’s top 10 exporters and importers of merchandise and 2nd in the exports of services, which can balance the deficit caused in merchandise trade. Around half of the UK’s trade happens with the EU, reducing the trade cost and making the goods and services affordable for the people of both the UK and EU. Britain’s exit from the EU will end the free movement of people, goods & services and capital. However, it will not take away traders’ tax-free and limitless imports & exports, rather they shall confront new trade procedures/policies, paper works & delay in the process. The exit makes way for the UK to create a new trade policy and lubricate the existing policies to strengthen its international trading regime with a bilateral, multilateral and free trade agreement with the developed and developing countries. For instance, there is no free trade agreement between the EU and countries like the US, Australia & New Zealand which shall now be a scope of development & advancement for the UK with an expected short term real income growth of 0.6%.

Discussions are ongoing between the two entities to efficiently manage the transition. But decisions are yet pending in the sectors like Banking & Financial Services, Fishing, Travel & Education, Energy & Climate, Data & Security, Thematic Cooperation and Unions Programmes which may conclude down the line with mutual understanding and advantages. When seeing UK’s exit globally, they would lose out on collective bargaining power in the EU i.e. up to 18% of the EU’s single market which is the world’s largest trading bloc. It’s true that now Great Britain can enjoy the whole pie instead of a piece, but then they shall also face the consequences alone. And one of those consequences would be to revive the falling economy of the UK post-exit. As per stats, the expected overall GDP fall in the UK would sum up between 26 billion GBP to 55 billion GBP, which is estimated to be twice the total income loss of the member states of the EU. 

 

Checklist for Traders  

  1. From January 1 2021, UK becomes the THIRD COUNTRY to the EU. This means the UK is no more entitled to enjoy the luxury & rights given to the member states. Not leaving out the EU’s VAT scheme, which shall no longer be valid for third countries. Hence, VAT added with customs duty and handling fee must be borne by the traders with mandatory customs clearance procedure.
  2. Mandatory EORI (Economic Operators Registration and Identification number) number for companies of the importing country for import and export between third countries and the EU.
  3. Mandatory Customs/Transportation documents: CN22 (<300 SDR) & CN23 (>300 SDR) to be beard by the exporter.
  4. Mandatory T1 transit documents in EU: For the free movement of goods within the EU originated outside the EU.
  5. Other Documents required: Sales contract, Commercial & Performa invoice, Shipping bill/Airway bill, Bill of Lading, Packing list, Customs declaration and Insurance Policy.
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