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Important story on what a “tariff-free” deal means in practice and why it’s not enough for two economies as closely integrated.
Tariffs are removed on goods that meet rules of origin. This is a complex and nuanced area of customs.
/1
Important to remember that trade deals (FTAs) weren't designed with such a high degree of economic integration in mind.
So some of the standard RoO provisions will seem incredibly restrictive under the UK-EU deal.
/2
Minimal operations or insufficient processing is a standard part of an FTA. Most, if not all FTAs, include a provision on minimal processing – processing not considered sufficient to confer originating status even if rules of origin have been met.
/3
It is standard procedure not to apply cumulation when goods have only been subject to minimal processing.
To be able to cumulate origin and consider the final product of UK origin, the processing carried out in the UK needs to exceed minimal operations.
/4
The level of integration between the UK and the EU means that this will have significant consequences for a number of industries.
For example, in supply chains where goods are brought into the UK from the EU and reassembled, sorted or repackaged and re-exported to ROI.
/5
Important story on what a “tariff-free” deal means in practice and why it’s not enough for two economies as closely integrated.
Tariffs are removed on goods that meet rules of origin. This is a complex and nuanced area of customs.
/1
\U0001f6a8\U0001f6a8\U0001f6a8\U0001f1ea\U0001f1fa\U0001f1ec\U0001f1e7\U0001f69b\U0001f692\U0001f1ea\U0001f1fa\U0001f1ec\U0001f1e7\U0001f6a8\U0001f6a8\U0001f6a8 serious #brexit story alert - companies now starting to see penny drop on what rules of origin does to supply chains (food for example) but Brussels seems deaf to both EU & U.K. pleading. A bellwether? \U0001f62c Stay with me. 1/
— Peter Foster (@pmdfoster) January 6, 2021
https://t.co/HoDSDxhKaL
Important to remember that trade deals (FTAs) weren't designed with such a high degree of economic integration in mind.
So some of the standard RoO provisions will seem incredibly restrictive under the UK-EU deal.
/2
Minimal operations or insufficient processing is a standard part of an FTA. Most, if not all FTAs, include a provision on minimal processing – processing not considered sufficient to confer originating status even if rules of origin have been met.
/3
It is standard procedure not to apply cumulation when goods have only been subject to minimal processing.
To be able to cumulate origin and consider the final product of UK origin, the processing carried out in the UK needs to exceed minimal operations.
/4
The level of integration between the UK and the EU means that this will have significant consequences for a number of industries.
For example, in supply chains where goods are brought into the UK from the EU and reassembled, sorted or repackaged and re-exported to ROI.
/5
So on origin, it’s getting a bit hard to keep up with all the rumours so here is where I think we are with this (correct me if I missed something)
/1 https://t.co/N5dDcbH7u7
Claiming origin.
Two ways for traders to claim origin under the EU-UK deal:
1⃣ Self-certification by the exporter (standard) – normally requires an authorisation, I’m hearing that might not be needed for UK-EU trade – waiting for guidance or more info
/2
2⃣ Self-certification by the importer (new(ish), in the EU-Japan deal and some continuity deals). UK importers have little experience with this one, but helpful guidance available given initial uncertainty around using this form of certification
/3
Retrospective claims.
For up to 3 years under each side’s domestic regulation – conditions, circumstances to be determined by both sides.
Careful here cause you might be required to have a good justification for why it wasn’t submitted at the time of import. Guidance needed
/4
Additional easements
On the UK side, this is part of the 6 months phase-in period– if you’re deferring a customs declaration you’re also deferring submitting an origin claim. If you're not deferring than origin documentation required at the time of import.
/5
/1 https://t.co/N5dDcbH7u7
Brief rules of origin guidance now available - doesn't cover the easements or retrospective claims - just the basic information: the two ways of certifying origin under the UK-EU deal and how to put the claim through via CHIEF and CDS https://t.co/14Up1y44OI
— Dr Anna Jerzewska (@AnnaJerzewska) December 28, 2020
Claiming origin.
Two ways for traders to claim origin under the EU-UK deal:
1⃣ Self-certification by the exporter (standard) – normally requires an authorisation, I’m hearing that might not be needed for UK-EU trade – waiting for guidance or more info
/2
2⃣ Self-certification by the importer (new(ish), in the EU-Japan deal and some continuity deals). UK importers have little experience with this one, but helpful guidance available given initial uncertainty around using this form of certification
/3
Retrospective claims.
For up to 3 years under each side’s domestic regulation – conditions, circumstances to be determined by both sides.
Careful here cause you might be required to have a good justification for why it wasn’t submitted at the time of import. Guidance needed
/4
Additional easements
On the UK side, this is part of the 6 months phase-in period– if you’re deferring a customs declaration you’re also deferring submitting an origin claim. If you're not deferring than origin documentation required at the time of import.
/5