Brexit Commentary: The Northern Ireland Protocol

With a UK general election tomorrow and conflicting and confusing messages coming from prime minister Boris Johnson about the conditions of trade between Northern Ireland and the mainland, John Perry (above) of supply chain and logistics consultancy Scala offers advice for businesses:

“Despite the fact we are now nine months past the original Brexit deadline, UK businesses are still facing a huge amount of uncertainty.

“While we do know that a clear Conservative victory on Friday will set the wheels of Boris Johnson’s withdrawal agreement in motion, many of the details still remain undecided.

“Of particular concern are the potential implications of Johnson’s Northern Ireland protocol.

“Border controls and customs processes for goods moving from Great Britain to Northern Ireland are yet to be defined, and there are worries that the proposed arrangements as currently constructed will cause considerable friction.

“As a result, doubts have also been raised over the feasibility of implementing the protocol Johnson’s self-imposed December 2020 deadline

“So, where does this leave businesses trading between Great Britain and Northern Ireland, and potentially moving goods onwards to the Irish Republic?

“If the Conservatives are elected, the precise details of Johnson’s agreement will hopefully become clear over the coming months. In the meantime, there are a few steps these businesses can take to ready themselves, whatever the outcome on Friday.

“The first is to take this opportunity to review their Incoterms with customers and suppliers. Incoterms define who is responsible for transaction costs and duties, so will have a direct impact on a business’s cost and risk exposure post-Brexit.

“Secondly, businesses that have not yet done so should register for HMRC’s Transitional Simplified Procedures. This will enable them to import goods into the UK without make a full customs declaration in advance, and also postpone paying duties and VAT.

“Thirdly, it’s essential that businesses ensure they are aware of the relevant temporary product and tariff codes and customs processes that may come into force.”