Companies face bureaucracy and delays under no-deal Brexit
UK companies trading with EU countries will face a thicket of additional red tape and potential delays if Britain leaves without a deal, government advice showed.
Under a no-deal scenario, goods that currently move freely between Britain and the EU would need customs declarations. The carrier of the goods would also have to make separate safety and security declarations. The EU would also require the declarations for goods coming into the EU from the UK.
Before importing goods from the EU under a no-deal departure, UK companies will need to register as a UK economic operator and make sure their contracts and terms of service reflect their new position as an importer. Companies may also need to use a customs broker, which will cost money. Companies may have to pay VAT upfront as well, unless the goods are stores in a customs or excise warehouse.
These are just some of the extra processes and complications exporters and importers are likely to face if the UK fails to agree terms with the EU by 29 March. The government published the details in one of 25 technical papers released on Thursday to prepare businesses and the public for a no-deal exit.
"If the UK left the EU [...] without a deal there would be immediate changes to the procedures that apply to businesses trading with the EU. It would mean that the free circulation of goods between the UK and EU would cease," the government said.
The government also said it had more than 7,000 people working on leaving the EU with funding agreed to hire another 9,000 civil servants – including nearly 6,500 operational staff.
The papers also said UK consumers may have to put up with slower, more expensive credit card payments when buying EU products and that British bank customers living in the EU "may lose the ability to access lending and deposit services, and insurance contracts."
Brexit secretary Dominic Raab said the papers were meant to stimulate a "sensible, responsible and realistic conversation about what a no deal situation really means." In a speech , he said 80% of the withdrawal agreement was in place and that a good deal was the most likely outcome of talks with the EU.
Trade secretary Liam Fox said earlier this month the chances of the UK leaving the EU with no deal had increased to 60:40 because of Brussels' intransigence.