BREXIT FALLOUT

SUPPLY CHAIN CANADA, ONTARIO INSTITUTE

INVITES YOU TO THE “Canada and the UK signed a memorandum of understanding in early December, laying the foundations for a trade continuity agreement.” between the UK and the EU, and goods now have to go through customs and other regulatory clearances. Although this creates complications, delays and extra costs, it’s a boon for customs brokers, as customs declarations are now required on both sides. Cus LEADERSHIPSERIES Christian Sivière is president at Solimpex. toms controls and inspections are required for many products, since the UK is no longer bound by EU THE NEW NORMAL HOW BREXIT WILL SHAPE THE UK’S TRADE WITH CANADA AND THE EU standards. This applies particularly for food products, with UK exporters having to supply health certificates for many exports to the EU, which they didn’t need before, adding delays and costs. All products of animal origin entering the EU and Northern Ireland now need an EU Export Health Certificate (EHC). Like all free trade agreements, the EU-UKTCA contains product-specific rules of origin and exporters must provide an origin certification to avoid customs LEADERSHIP SERIES PUBLIC SECTOR June 17, 2021 I Zoom Platform PUBLIC SECTOR CHAMPION TITLE PARTNERS IN PARTNERSHIP WITH import-export controls in both directions. Northern Ireland must follow EU customs rules, with special rules applying for trade, as it remains in the EU single market for goods. CANADA’S ROLE Canada and the UK signed a memorandum of understanding in December, laying the foundations for a trade continuity agreement governing Canada-UK trade. It mirrors our CETA Free Trade Agreement with the EU. Temporary measures COLLABORATIVE PARTNER good news. Brexit adds complexities for exporters, since it is no longer efficient to serve all of Europe through a single base. Companies doing business in both markets must rethink their distribution strategies due to the border complications, delays and costs. Customs is not the only issue: standards for products are now different (CE in the EU and UKCA in the UK), there are two channels for IP protection (UKIPO and EUIPO), changes with VAT and challenges on direct shipment rules. duties. The regional value content began January 1 to ensure contin- Companies must now treat these Brexit, the UK’s departure from the required for most products is 50 per ued preferential tariff treatment for markets separately and establish EU, happened on January 1, after cent of the EXW price. For gasoline goods shipped between the coun- separate distribution channels. several years of uncertainty. With and diesel automobiles, it is 55 per tries until a full CUKTCA is agreed Whether Brexit benefits the an exit agreement on December 24, cent. For electric and hybrid vehi- upon. CBSA issued a remission UK’s economy is an open question 2020 and the UK’s abrupt departure cles, the RVC is 40 per cent, going order so UK products still enjoy tar- but studies, including from the UK days later, there was little time for up to 45 per cent in 2026 while for iff-free entry. UK origin goods are Government, point to a decline in businesses to prepare. The UK left batteries, it is 30 per cent, going up now accounted for in our B3s under GDP. “Frictionless trade” doesn’t the European Single Market, the to 50 per cent by 2026. Unlike in MFN tariff treatment code 02, exist with a border, as it involves EU Customs Union, the Common CETA, there is no mutual recogni- with mention of Special Authority customs formalities, processes, Agricultural Policy, the Common Fishery Policy, EU Laws, RegulaLEADERSHIP SERIES tion agreement for testing and certification, so products have to be OIC number 20-1135 in field #26. The TCA replicates the CETA rules controls, additional steps, delays and costs. This was shown at the tions, Directives and the European tested and certified in the destina- of origin and allows for accumula- beginning of 2021 when UK goods Court of Justice. The EU-UK Trade and Cooperation Agreement governs the new relationship. Until that tion country. Northern Ireland now has special status and the UK is split in two: tion with the EU on a transitional basis for three years: materials sourced from the EU used in pro-HEALTHCARE SECTOR exports fell by £5.3 billion (19.3 per cent) in January, mainly because of a £5.6 billion (40.7 per agreement, there was uncertainty, with consumers and businesses Northern Ireland remains in the EU single market while Great Britain September 30, 2021 I Zoom Platform duction of goods in Canada or in the UK continue to count as origicent) fall in exports to the EU. UK imports fell by £8.9 billion (21.6 stockpiling products in the event of (England, Scotland and Wales) are nating goods. per cent) in January, driven by a a “no-deal’’ exit, which would have out. This is to avoid re-introducing It was important for Canada (and £6.6 billion (28.8 per cent) fall in increased costs by re-introducing a hard border between Northern Ire- the UK) to reach a quick, though EU imports. The January 2021 fall MFN tariffs/customs duties on land (part of the UK) and the Repub- incomplete, agreement as the UK is in UK goods imports and exports products. This would have been lic of Ireland (a full EU member). our first export market in Europe. TAKE ADVANTAGE OF OUR CORPORATE GROUP PRICING was the largest monthly fall since detrimental as UK exports to the EU account for 45 per cent of total UK exports and UK imports from the EU represent over half of UK imports. The Brexit TCA leaves an open border between Northern Ireland and the Republic of Ireland to preserve the Good Friday Agreement of 1998. These provisions, called the Gold and precious metals represent three quarters of our exports to the UK and are duty-free anyway. But the UK is a major supplier, our third one in Europe, after Germany and Member Pricing: $149 + HST I Non-member Pricing: $199 + HST (Complimentary membership until April 30, 2022) Group Pricing: $99 per attendee for a group of four (4) or more records began in 1997. SP SAVE UP TO 50% WITH OUR GROUP PRICING

The EU-UK Trade Continuity Northern Ireland Protocol, establish Italy, and ahead of France. Agreement applies to goods, not an unofficial “border” between Tariff-free access to the EU and services. It re-introduces a border Northern Ireland and the UKFOR REGISTRATION AND/OR PARTNERSHIP ENQUIRIES , with the UK are maintained and that’s Registration: Visit www.supplychaincanada.com/events or contact Alisha Seguin: +1 416.977.7566 x2150 I aseguin@supplychaincanada.com Partnership: Contact Kim Sforza: +1 416.977.7566 x2134 I ksforza@supplychaincanada.com SUPPLYPRO.CA 19