EU protocols on Northern Ireland trade are ‘nutty’ says expert
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Overall 45 percent of firms reported problems according to data from the British Chambers of Commerce (BCC). In January 2021 border, VAT and customs controls on British goods moving into the EU were introduced as part of the UK-EU Trade and Cooperation Agreement (TCA) The second part of British border controls on inbound goods will be phased in from January 2022. Under the terms of the TCA the UK and EU agreed to zero tariffs on goods, however, to qualify firms have to ensure goods meet requirements such as Rules of Origin.
The BCC surveyed 981 businesses over their experiences of the TCA and have launched a new report on how to improve trade.
One professional services firm in Herefordshire complained: “Different EU countries apply the rules incorrectly and are still not accepting our paperwork although it is complete”.
Meanwhile, a wholesaler in the East Midlands explained another problem was: “EU customers not understanding the change made by the EU on their ability to purchase from us.
“This mainly is the lack of understanding that the EU requires businesses to now pay VAT at point of import (mostly without any VAT deferment programme) as well as the cost of customs clearance fees.
60 percent of UK exporters reported difficulties (Image: Getty)
Under the EU-UK trade deal goods must meet certain requirements such as Rules of Origin (Image: Getty)
“The lack of understanding by small businesses within the EU27 is shocking.”
According to the BCC, VAT requirements were a frequently reported issue by businesses trying to trade with the EU.
Other issues cited were additional customs checks and procedures and new Rules of Origin requirements.
Many of these requirements have come into effect following the adoption of the TCA agreed with the EU at the start of this year.
The percentage of firms reporting difficulties with exports has risen this year (Image: Getty)
Today’s figures on firms reporting difficulties shows a marked increase in this time frame with only 30 percent reporting issues buying and selling goods in January 2021.
Liam Smyth, Managing Director of ChamberCustoms said: “At ChamberCustoms we work day in and day out with companies to help them navigate the complexities of international trade.
“We’ve seen a huge demand for our services in relation to trading with the EU since the implementation of the TCA, and we know first-hand what difficulties firms on the ground are facing.”
Shaun Haviland, Director General of the British Chambers of Commerce, added: “The Government have ambitious goals for the UK export sector, which we share, and if these are to be met then we must improve the experience of firms trading with our nearest and largest trading partner.”
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The BCC want to see a compromise agreed on the Northern Ireland Protocol (Image: Getty)
According to Mr Haviland although the TCA has “structural defects” these are fixable.
In particular, the BCC is calling for an agreement on VAT cooperation with the EU in the same way that currently exists with Norway.
They also want to see an agreed compromise on the Northern Ireland Protocol, ideally by early 2022.
Mr Haviland concluded: “We hope that these figures, along with our report detailing the experiences of businesses and suggesting ways forward, will provide an opportunity for an honest dialogue about how we can improve our trading relationship with the EU.
“Government needs to ensure that our importers and exporters can fully play their part in the UK’s economic recovery by unleashing their ability to trade as freely as possible with European markets.”