How Can I Trade Internationally Post-Brexit from the UK?

 The UK's exit from the European Union, commonly referred to as Brexit, has brought significant changes to the way UK businesses trade internationally. With new regulations, customs procedures, and trade agreements, navigating international trade post-Brexit requires businesses to adapt quickly to maintain and grow their global operations.

If you are a UK business owner or entrepreneur wondering how to trade internationally after Brexit, this detailed guide will walk you through the key considerations, requirements, and best practices to succeed in international trade in this new era.

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Understanding the Post-Brexit Trade Landscape

Before Brexit, the UK enjoyed frictionless trade with other EU member states under the single market and customs union arrangements. This meant no customs checks, tariffs, or border delays for goods moving between the UK and EU countries.

However, since the UK formally left the EU and the transition period ended on 31 December 2020:

• The UK is no longer part of the EU single market or customs union.

• New customs declarations and procedures apply to goods moving between the UK and the EU.

• Rules of origin, tariffs, VAT changes, and regulatory compliance requirements have changed.

• The UK is free to negotiate its own trade agreements with countries worldwide.

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Step 1: Understand Your New Trading Environment

Customs Declarations

If you export or import goods to/from the EU or other countries, you must submit customs declarations. This includes:

• Export declarations when shipping goods out of the UK.

• Import declarations when bringing goods into the UK.

You will need to register for Economic Operator Registration and Identification (EORI) numbers for customs purposes.

Rules of Origin

Post-Brexit trade agreements require proof of where your goods are made to qualify for preferential tariff rates. You need to:

• Understand the rules of origin for your products.

• Obtain certificates or evidence proving your goods meet origin criteria.

• Otherwise, you may face tariffs on your goods.

VAT Changes

The way VAT applies to imports and exports has changed:

• Imports into the UK are subject to import VAT, which can be accounted for via postponed VAT accounting.

• Exporting goods to the EU is zero-rated for VAT, but you must keep evidence of export.

• Selling goods online to EU consumers involves new VAT registration requirements under the Import One Stop Shop (IOSS) and other schemes.

Product Standards and Compliance

Many goods moving from the UK to the EU now require compliance with EU product standards and certifications, and vice versa. This includes:

• CE marking replaced in the UK by UKCA marking for certain products.

• Ensuring products meet both UK and EU regulations if trading on both sides.

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Step 2: Register for the Necessary Schemes and Licenses

Get an EORI Number

• An EORI number is required to move goods in and out of the UK and EU.

• UK businesses need a UK EORI to trade with the EU and non-EU countries.

• If you also trade within the EU, you may need an EU EORI number.

Customs Declarations and Agents

• You can either manage customs declarations yourself or hire a customs broker or freight forwarder to handle paperwork and compliance.

• Familiarize yourself with the Customs Handling of Import and Export Freight (CHIEF) system or its replacement, the Goods Vehicle Movement Service (GVMS).

Licenses for Controlled Goods

• Certain goods require export or import licenses, such as firearms, chemicals, medicines, or food products.

• Check whether your goods need licenses through the Export Control Joint Unit (ECJU) or other relevant authorities.

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Step 3: Understand Trade Agreements and Tariffs

UK-EU Trade Agreement

• The UK and EU agreed to a Trade and Cooperation Agreement (TCA), allowing tariff-free and quota-free trade for goods that meet rules of origin.

• You must prove origin to avoid tariffs.

• Non-compliance may result in tariffs or rejected shipments.

UK’s Global Trade Deals

• Post-Brexit, the UK has signed or rolled over trade agreements with countries such as Canada (CETA), Japan, Australia, New Zealand, and many others.

• These agreements often offer tariff reductions or eliminations if goods meet origin rules.

WTO Rules

• Where no trade deal exists, trade defaults to World Trade Organization (WTO) rules, meaning tariffs and quotas may apply.

• Understanding tariffs under WTO schedules for your products is important.

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Step 4: Manage Logistics and Supply Chain Changes

Customs Checks and Delays

• Expect additional checks at borders, customs points, and ports.

• Plan for longer lead times and potential delays in shipping.

• Consider warehousing or distribution centers within the EU to streamline delivery.

Incoterms

• Use clear Incoterms in contracts to define who is responsible for customs clearance, duties, and transportation costs.

• Popular terms include DAP (Delivered at Place), DDP (Delivered Duty Paid), and FOB (Free on Board).

Transport Documentation

• Ensure all transport documents, such as commercial invoices, packing lists, certificates of origin, and licenses, are accurate and accompany shipments.

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Step 5: Manage Financial and Payment Processes

Currency and Payment Terms

• Brexit introduces currency risk for trading with the EU. Consider hedging currency exposure.

• Agree on clear payment terms with international customers.

VAT Refunds and Payments

• Businesses can reclaim foreign VAT paid on business expenses through schemes in various countries.

• Post-Brexit, the processes for VAT refunds in the EU have changed; some may now require applications to individual EU countries.

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Step 6: Adapt Your Business Strategy for Post-Brexit Trade

Market Research and Diversification

• Reassess your export markets in light of new trade rules.

• Consider diversifying your supply chains to non-EU countries with favorable trade deals.

• Explore new markets via UK free trade agreements.

Digital and E-Commerce Exports

• Online sales to EU consumers require new VAT compliance (e.g., IOSS for goods under €150).

• Plan for customs clearance and additional charges that customers may face.

Invest in Training and Expertise

• Educate your team on new customs procedures, compliance, and logistics.

• Work with trade advisors, export councils, or chambers of commerce.

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Step 7: Leverage Support and Resources Available

The UK government and various organizations provide resources to help businesses trade internationally post-Brexit:

• UK Export Finance (UKEF): Financial support for exporters.

• Department for International Trade (DIT): Offers advice, market insights, and trade missions.

• HMRC: Detailed guides on customs procedures, VAT, and export documentation.

• Local Chambers of Commerce: Practical support and networking.

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Common Challenges and How to Overcome Them

Increased Administrative Burden

• Customs declarations and compliance add complexity.

• Solution: Invest in customs software, hire brokers, and automate paperwork where possible.

Risk of Delays and Additional Costs

• Border checks can delay shipments, increasing costs.

• Solution: Plan shipments well in advance, build flexibility into supply chains.

Complex VAT Rules

• Managing VAT in multiple jurisdictions is complex.

• Solution: Use VAT specialists or accounting software tailored to international trade.

Regulatory Divergence

• UK and EU rules may diverge over time, complicating product compliance.

• Solution: Stay informed and consider dual certifications if needed.

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Summary: Key Takeaways for UK Businesses Trading Internationally Post-Brexit

Area	Key Action
Customs	Register for EORI, file declarations
Tariffs	Understand rules of origin, use trade deals
VAT	Learn import VAT, IOSS, and refund rules
Logistics	Plan for delays, use appropriate Incoterms
Compliance	Meet product standards for UK and EU
Market Strategy	Diversify markets, explore new trade deals
Support	Use government and trade bodies resources

Conclusion

Brexit has transformed international trade for UK businesses, introducing new rules and administrative demands. However, with the right preparation, knowledge, and support, UK businesses can continue to trade successfully with the EU and the wider world.

By understanding customs procedures, managing tariffs, adapting logistics, and leveraging trade agreements, you can minimize disruption and seize new opportunities in global markets. The post-Brexit environment challenges businesses to be more agile and strategic, but it also opens doors for growth beyond the EU.

If you're ready to take the next step, ensure you register for the correct schemes, update your compliance processes, and consider professional advice to navigate the complexities of international trade after Brexit.