Brexit – Union Customs Code

SCENARIO:  The Union Customs Code and EU regulations will no longer apply to the UK in the event of Brexit.

EFFECT:  New customs regulations will be required for the UK and currently no one knows what this will look like.  Due to lack of access to the EU customs code which does currently provide reliefs and harmonisation, businesses would face increased customs duty, higher administration costs of imports / exports both from / to the EU and non-EU countries.  Loss of special reliefs and measures such as inward-processing relief, AEO status , no referral to the CJEU and loss of EU co-operation and mutual agreements. MNCs with cross border supply chains and exposure to EU customs procedures would be affected.

Ideally the UK should put in place a new customs regime which “mirrors” the EU model and benefits from reciprocity.  However, no one knows if such measures will reach agreement and how long it will take.