Problem: Goods from the UK detained by Customs
A case currently occupying the commercial law team of our firm Schlun & Elseven Rechtsanwälte PartG mbB shows how serious the violation of the new requirements for the movement of goods between the EU and the UK can be. Our client distributes its goods from the UK to the EU via the online mail-order company Amazon. Due to the Brexit and its extensive impact, Amazon, particularly the distribution centre in the UK, has also experienced logistical problems and is no longer accepting goods. Amazon had also instructed our client (and presumably many other sellers) to import its goods from the UK to Germany independently. As a result, our client’s goods from the UK did not have the necessary documents for customs, so that his high-quality goods are now being detained in Germany and are to be destroyed or returned.
To prevent having such goods detained by customs, we explain below what you need to consider when importing goods from the UK into the EU or exporting goods from the EU to the UK. For further questions or immediate legal representation and advice in all problem constellations of Brexit, please contact us directly.
Customs Requirements despite the Trade and Cooperation Agreement
From 1 January 2021, the customs regulations provided for in EU law will apply to the movement of goods between the EU and the UK. While the Trade and Cooperation Agreement’s comprehensive arrangements provide zero tariffs and zero quotas on goods and customs and regulatory cooperation, all products traded between the EU and GB will nevertheless be subject to the relevant regulatory controls and import controls. These controls relate to safety, health and other European public welfare objectives.
The additional bureaucratic burden for companies with direct UK business includes EORI numbers, customs declarations, tariff numbers, rules of origin, export control, and preferential proofs and calculations.
Prohibitions and Restrictions for Importers/Exporters
Besides, various areas of EU law provide for prohibitions and restrictions on imports from third countries or exports to third countries for certain goods, which will also apply to the UK as a third country from 1.1.2021. These may take the following forms:
- Absolute ban (seal pups, their skins and goods made from them).
- Required border controls by specialised competent authorities (health, food safety, etc.)
- Quantitative restrictions under a quota system.
- Licensing or registration of the importer or exporter,
- Required licensing/authorisation by an authority or notifications of a shipment to an authority
- Documentation (licences, permits, certificates, etc.) accompany a consignment (e.g. eel).
- Additional due diligence requirements for the importer (e.g. timber and timber products).
Customs Measures to Prevent having Goods detained by Customs
For exports of goods from the EU to the UK (excluding Northern Ireland), you will need to make a customs declaration in the ATLAS system from 1.1.2021 for each export, subject to the ordinary customs rules for third countries in the EU. You will need an EORI number for this. Through the electronic release for export, you as the declarant then receive the export accompanying document (ABD), which the export customs office releases after the goods have been checked. This export accompanying document must then be printed out by the company and presented at the customs office of exit before the goods can be exported from the EU.
After retrieving the data from the central server, the customs office of exit electronically confirms the exit of the goods to the customs office of export and the company. This confirmation to the company, in turn, acts as proof of export, for example, to the tax office.
British companies must show a British EORI number to register import and export procedures, including the EU. These actions need to be taken to prevent having goods detained by customs.
Export Control and Licensing Requirements
As the UK is to be treated as a third country from 1.1.2021, it will fall under export control regulations. It should be noted that trade with other countries is generally not subject to licensing, but there are some exceptions to this rule. Therefore, you should currently have it checked whether your export goods are subject to a licensing requirement. The deciding factor is whether your company’s goods are listed in the German Export List or the Annexes to EC Regulation 428/2009. Special attention should be paid to:
- Certain firearms, as well as corresponding ammunition and reloading devices,
- exports in connection with trade and brokering transactions, as well as technical assistance
- dual-use goods, and
- goods covered by the Anti-Torture Regulation
Rules of Origin and Preferential Treatment
From 1.1.2021, companies need to prove the originating status of traded goods to be eligible for preferential treatment under the EU-UK Agreement. If the goods do not meet the origin requirements, customs duties may be levied. Therefore, it is essential to make the necessary arrangements for correct proof of origin to ensure the smooth movement of goods without tariffs between the EU and the UK.
Our team of customs lawyers can handle this demanding and bureaucratic procedure for you effectively and promptly.
Other Specific Customs Requirements: Movement of Goods between the EU and the UK
In addition to these aspects, there are further specifics to be considered for the movement of goods between the EU and the UK:
- The rules for the payment and refund of VAT will change from 1 January 2021 for both goods and services. If excisable goods (tobacco products, alcoholic beverages, etc.) are supplied from the UK to the VAT territory of the EU, excise duties will also be levied.
- On 1.1.2021, the authorisations granted the validity of the UK authorities for placing products on the EU market will expire. This means, for example, that a motor vehicle with a type approval issued by the UK may no longer be sold in the EU. Even if certification by a notified body of the EU is required under EU law (e.g. for some machines, medical or construction products), this can no longer be carried out by a body based in the UK. These products may then no longer be marketed on the internal market.
- Products placed on the EU market must be properly labelled and marked. European labelling requirements for goods marketed in the EU will no longer be met if the marking or labelling of goods refers to entities or persons established in GB.
- Exports of goods from the EU to the UK must comply with the new conformity marking. Instead of the CE marking, GB has introduced the UKCA – UK Conformity Assessed from 1.1.2021.
- The EU regulations on the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) will also no longer apply in GB from 1.1.2021. Therefore, it must be ensured that chemical substances to be imported into the EU are registered with a manufacturer or importer in the EU or that a person has been appointed to take responsibility for these imports as an official registrant.
Legal Representation on all Brexit Issues
Our legal team at Schlun & Elseven Rechtsanwälte PartG mbB is ready to support you when dealing with the German authorities and customs procedures, and export control requirements. Our team will help you prevent goods from being detained by customs officials and guide you through the new legal requirements. As a full-service law firm, our interdisciplinary approach and many years of experience can achieve the smooth movement of goods between the EU and the UK as quickly and efficiently as possible, even with the new challenges of Brexit.
With offices in Cologne, Aachen and Düsseldorf and conference rooms in Hamburg, Stuttgart, Munich, Berlin and Frankfurt, you can take advantage of our support and advice nationwide. Contact us now to start working with us today.