The SCR Chambers: Sheffield


How much will Brexit affect your profitability?


Nick Patrick (pictured), Head of International Trade at Sheffield Chamber of Commerce, discusses how Brexit may affect a business’s profitability.


the world. Fortunately though, we did have the


F


withdrawal agreement which in turn allows an 11 month transition period, however clarity on exactly what the transition period covers is still needed. Is it acceptable to assume that there will be no change whatsoever for at least 11 months? Do we need to consider that while the EU has full influence over the 27 EU member countries, how much influence do they have over the 70 countries with whom Free Trade Agreements (FTA) are established? Surely the EU’s influence is limited. What about the strict rules surrounding the World Trade Organisation’s (WTO) and World Custom’s Organisation’s (WCO) mandates? Is it acceptable to expect some form of customs procedure control with the EU if we consider WTO and WCO rules? I believe it would be wrong to simply assume


nothing will change until the 31 December 2020, the effect will be akin to the no deal ‘cliff edge’. Will companies be prepared by then? Should we expect that there will be a slow migration from free EU trade to full customs procedures over a period of time? Indeed, I feel it would be prudent to expect some procedures to be implemented within a few months after 31 January. Though we do not know for sure, certain requirements such as certificates of origin and even customs declarations may be required as a precursor to introducing full customs procedures, duties, VAT and border checks over a slower and an easier to manage process for importers and exporters involved in European trade with the UK. What about continuity deals? Up to 6 January


2020 the UK has signed 20 continuity deals that cover 50 non-EU countries or territories. Some are important for South Yorkshire, such as South Korea, Southern Africa and Switzerland. However, as a country we need to focus on those markets with whom we have significant trade, the 20/80 rule! We are getting there but according to the rules surrounding our membership with the EU, we were not allowed to negotiate any FTA’s until we are out of the European Union, so who knows?


riday 31 January has been and gone. The UK PLC is no longer in the EU therefore a free agent able to negotiate deals around


‘It would be


wrong to simply assume nothing will change until the 31 December 2020’


One thing for sure, it will be so much easier


for the world to negotiate an FTA with one country (the UK) rather than 27 (the EU member states). Sheffield Chamber International Trade Centre


has been integral in assisting business to understand the ‘Brexit effect’ on their businesses.


We can calculate the effect of duties, customs procedures and cash flow on their profit and loss statement after full customs procedures are implemented. We thoroughly understand customs procedures and systems, therefore are able to look at mitigating costs and risks specifically for each business we are working with.


If you would like to have a discussion about the Brexit effect on your business, to make sure all bases are covered and to look at implementing customs systems which may significantly reduce your exposure, please get in touch by calling 0114 201 8888. In addition, our website is constantly being updated with more information and resources for business, and I would encourage you to take look via www.scci.org.uk/international


Winter 2020 CHAMBERconnect 53


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