The first few weeks of post-Brexit
It has been 8 weeks since the actual Brexit has fallen into place. The British exit of the European Union has been in the works for several years now, starting in 2016 with the UK-wide referendum - where the people chose to end the 47 years membership of the state. Of course, the impact is quite big to every business involved with the UK. What has have been the first findings after the start of the Brexit? And what do you have to keep in mind for your beverage business?
COVID-19
Starting the Brexit during a worldwide pandemic was something that wasn’t taken into account when planning this the Brexit strategy. This came with some extra struggles, but it also had some unexpected benefits! For example, it made for a hard Brexit since the boarders were already closed because of the British mutation of the corona virus. The complete, temporary isolation of the United Kingdom provided a foretaste of what a Brexit without a trade deal tastes like.
What does it mean for your beverage business?
Around 18% percent of the beer market in the UK is being imported by international brands. Thanks to the Brexit and its corresponding bureaucracy makes that exporting and importing will become a lot more expensive. The Financial Times newspaper put out a report that states that the bureaucracy alone could add 10 percent in costs to a bottle of imported wine. This already has its effect – companies like Omnipollo’s and Beers of Belgium’s webshop have already suspended shipments to the UK.
The effect of these rising costs will eventually be put on the end-consumer. Will they still be able to enjoy their (not UK) beers? For this, we will keep you up-to-date!
However, some UK brewers may see the benefits. With higher prices on the big international brands - the UK craft beer scene might reap the benefits of the Brexit and see an increase of their sales.
Are you ready?
A third of UK food and drink companies said they definitely won't be ready for the end of the Brexit transition period. The coronavirus is one of the biggest reasons that companies feel they didn’t have enough time and possibilities to prepare themselves on top of all the restrictions. We have listed some of the key things to take in consideration if you’re in the UK and doing business with the EU – and the other way!
For UK companies the government* has set some key to-do’s for your business:
1 - Goods
If you import or export goods to the EU, you must get an EORI number, make customs declarations or employ an agent to do them for you, check if your goods require extra papers (like plant or animal products) and speak to the EU business you’re trading with to make sure they’re completing the right EU paperwork. There are also special rules that apply to Northern Ireland. Hauliers must obtain a Kent Access Permit and have a negative COVID test before they head to port in Kent.
2 - Services
If you deliver services to the EU, you must check whether your professional qualification is recognised by the appropriate EU regulator.
3 – People
If you need to hire skilled staff from the EU, you must apply to become a licensed sponsor.
4 – Travel
If you need to travel to the EU for business, you must check whether you need a visa or work permit.
5 – Data
If your goods are protected by Intellectual Property (IP), you will need to check the new rules for parallel exporting IP protected goods from the UK to the EU, Norway, Iceland and Liechtenstein. You risk infringing on IP rights if you do not follow the new rules.
6 - Accounting and reporting
If your business has a presence in the EU you may need to change how you undertake accounting and reporting to ensure compliance with the relevant requirements.
Doing business with the UK?
Beverage companies that are doing business with the UK should keep these points in mind according to the UK government**:
- Getting a GB EORI number
- Making sure that your products comply with UK food labelling requirements
- Getting the right documentation to send with your goods if you are exporting animals or animal products
- Sending your goods through a designated Border Control Post (BCP)
- Complying with the new phytosanitary requirements if you are exporting plant products
The UK government has a guidance for food and drink business, an interesting link to go to: https://www.gov.uk/guidance/food-and-drink-businesses-working-with-the-eu
Keep an eye on our Drink-IT blog for future changes in this new world post-Brexit!
** https://www.gov.uk/guidance/eu-business-exporting-to-the-uk#exporting-food-and-drink
