Most UK exporters unprepared for EU's no-deal trade requirements

Harry Robertson
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Many EU businesses would expect discounts from UK suppliers should Brexit bring border delays (Source: Getty)

Over half of British exporters have said they would not be able to comply with four key EU customs requirements in the event of a no-deal Brexit, according to a new survey.

Should the UK crash out of the EU without a deal, firms would struggle with the technology and bureaucracy required to continue trading with the bloc from outside the single market, a survey of supply chain managers from the Chartered Institute of Procurement & Supply (CIPS) shows.

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Of the British exporters surveyed, 60 per cent say they would not be able to apply for an identification number needed to trade with the EU, called an Economic Operator and Registration Identification (EORI) number; complete the required data fields on customs declaration forms; agree responsibilities with their customs agents and logistics provider; and identify software for submitting documents if they do not use a customs agent.

EU membership means that British firms do not currently have to comply with these requirements, which only apply to countries exporting to the EU from outside the single market.

The survey, which spoke to 1,749 UK and EU-based supply chain managers, also revealed that after Britain leaves the EU, with or without a deal, one in five EU businesses would expect a discount from UK suppliers should there be border delays of just one day. A quarter of EU businesses said they would withhold payment until after goods arrived, which could cause UK suppliers headaches over cash flow.

A delay of two to three weeks would see 60 per cent of EU businesses switch to back up suppliers based elsewhere, survey responses indicated.

A government spokesperson told City A.M. that £8m has been made available to help private customs intermediaries and traders increase their capacity and train employees to prepare for a no-deal scenario.

The spokesperson said: “The government is continuing with our no deal preparations to ensure the country is prepared for every eventuality. Our preparations include publishing 106 technical notices over the summer as well as more than 100 pages of guidance for businesses on processes at the border, and advising hundreds of ports and other organisations that use the border about potential changes so they can get their supply chains ready.”

They added: “Leaving the EU with a deal remains the government’s top priority, but be in no doubt we are continuing to prepare extensively for no deal.”

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CIPS economist John Glen said: “The financial cost of Brexit indecision will not be paid in Whitehall, but by Britain’s businesses. Britain’s supply chains are so finely balanced, that even a temporary delay at the border after 29 March will see UK businesses paid later and paid less for their goods.”

“If the UK does stumble out of the EU without a deal next month, the majority of British businesses would not even be able to file the right paper work to get goods across the border”, he said.