Migration policy in no deal:

Up until 2021 EU visitors will be free to enter and exit the UK up to 3 month period. This includes departing for a day and then re-entering for another 3 month period. If EU visitors wish to stay for longer they can apply for a 36 month European Temporary Leave to Remain. Applications for this can be received up until 90 days (and EU residents are allowed to remain while their applications are being processed). This will only apply during the transition period, from the point that free movement ends and the new immigration system begins (2021). There will still be visa free access under the new immigration system but it won’t be under the same terms/conditions.

The European Temporary Leave to Remain scheme will also be open for applications during the transition period. It will close at the end of 2020 but leave to remain granted under that scheme will remain valid for up to 36 months – meaning that there will still be some people holding this leave until the end of 2023. When the new immigration system is introduced, those with European temporary leave to remain will need to apply under this if that want to stay longer than 36 months (subject to there being a route available to them). A link to UK’s future skills based immigration bill is here and chapter 6 lists relevant criteria for business.

Trade questions:

Will I be able to hire EU nationals in the future – and under what conditions?

Yes. At present, the UK has a dual system of admitting only highly skilled workers from outside the EU, and workers of all skill levels from the EU.

The UK will replace this with a single route which gives access to highly skilled and skilled workers from all countries. Those coming to the UK on this route will need an employer to sponsor them. The Immigration White Paper also includes a temporary short-term workers route as a transitional measure, to help employers move smoothly to the new immigration system.

The Home Office will set out further details on the future system shortly.

Will business travel between the UK and the EU involve further administration, costs or visas?

Yes.

● Administration: The EU has confirmed UK citizens would not need a visa when travelling to the Schengen area for short stays of up to 90 days in any 180-day period. However, traveling for the purposes of work and for certain business activities may require extra conditions.. Businesses will need to check individual EU MS immigration rules for more information regarding visits, supporting documentation, work permits, other conditions, visas and requirements for posted workers

● Cost: The European Commission has confirmed that after the UK leaves the EU it will be considered a “third country”, and as such UK citizens will have to pay €7 to enter the bloc from 1 January 2021, when the online ETIAS system is in place

Will my business be able to move skilled staff members between the UK and the EU in future?

There will be different arrangements for each EU country. The EU will treat the UK as a third country in no deal which means businesses ability to move staff will depend on the EU countries immigration regime.

Will UK firms and institutions be able to participate in European R&D projects after 2020?

The government guarantee ensures that UK organisations, such as charities, businesses and universities, will continue to receive funding over a project’s lifetime if they successfully bid into EU-funded programmes including Horizon 2020 before the end of 2020.

The next generation of EU programmes beyond 2020 are currently under negotiation in the EU.

Will UK projects be eligible for support from the EIB after 2020?

As the Chancellor has said, if we do not maintain our relationship with the EIB group for the future, we will be prepared.

The government already has a range of existing tools to support infrastructure finance, including the £40 billion UK Guarantees Scheme, and we are reviewing how the government supports infrastructure finance, to ensure good projects continue to be able to raise the finance they need.

And at Budget 2018, the Chancellor announced that if no future relationship with the EIB Group is in place when the UK leaves the EU on 29 March 2019, the government will provide the British Business Bank with the resources to enable it to make up to £200m additional investment in venture capital and growth finance in 2019/20.

How will the UK replacement for EU Funds work, and how can my company access opportunities?

Science, research and innovation are vital to our country’s prosperity and form an integral part of the Government’s modern Industrial Strategy. The government is considering what other measures may be necessary to support UK research and innovation in the event that the guarantee and the extension are required. We are working with stakeholders to identify appropriate measures that could be put in place in the period immediately after EU Exit, if needed.

Following our departure from the EU, we will create a UK Shared Prosperity Fund to tackle inequalities between communities by raising productivity, especially in those parts of our country whose economies are furthest behind. The UK government can cut out bureaucracy and deliver a simpler Fund, which will be easier for local areas to access and cheaper for government to administer.

Will I need to pay VAT on goods at point of import? Will I be able to use postponed accounting or have access to more generous deferment account terms to offset the cash flow issues?

If the UK leaves the EU without an agreement, the Chancellor announced that the UK will implement postponed accounting for import VAT on goods brought into the UK.

Will I need to become VAT-registered in every EU Member State where my firm has clients?

In a no deal Scenario, the rules in which determine which country VAT should be charged in (Place of Supply rules) will remain the same for UK businesses.

UK VAT Mini One Stop Shop (MOSS) is an online service that allows businesses selling digital services to consumers in EU countries to pay VAT via a single return and payment in the UK. In a ‘no deal’ scenario, businesses will no longer be able to use the UK’s MOSS and will need to register for the VAT MOSS non-union scheme in an EU country. This can only be done after the date the UK leaves the EU.

Which regulator will be overseeing my business in the future, and what rules do I need to follow? Is the UK government going to charge businesses for the creation of new regulatory agencies in the UK?

The European Union (Withdrawal) Act will provide a functioning statute book on the day we leave the EU. To maximise certainty for individuals and businesses the laws and rules that we have now will, so far as possible, continue to apply

In most cases we anticipate that repatriated EU functions can be absorbed by departments and existing public bodies.

The government has currently published plans for the creation of three additional bodies:

–  a Trade Remedies Authority proposed in Part 2 of the Trade Remedies Bill;

–  a new, independent and statutory body holding government to account for the environment, proposed in Defra’s consultation document “Environmental Principles and Governance after the United Kingdom leaves the European Union”  in May 2018;

–  and an independent authority for monitoring the implementation and application of the Citizens’  rights provisions of the draft Withdrawal Agreement (as set out in Article 152 of that draft agreement).

Will conformity assessments on products conducted by a UK body will continue to be sufficient for the product to be sold on the EU market?

The results of conformity assessment carried out by UK conformity assessment bodies will no longer be recognised in the EU. This means that products assessed by a body that was, prior to exit, a UK notified body will no longer be able to be placed on the EU market without reassessment and re-marking by an EU recognised conformity assessment body (or, alternatively, the manufacturer may seek to arrange for their files to be transferred to an EU-recognised body pre-exit).

What dispute resolution and means of redress will be available to my business in the future?

In a no deal scenario, UK businesses will continue to be able to seek dispute resolution and redress through the national court systems (including those of Member States where they have jurisdiction) which will process with the case in line with their normal management of business, and any relevant legislation. The route of redress and dispute resolution will depend on the particular facts of the case.

What industrial standards will my firm need to comply with in the future, and will the UK stick with the European model that we have strongly influenced?

The costs that EU mobile operators would be able to charge UK operators for providing roaming services would no longer be regulated after March 2019. However, surcharge-free roaming for UK customers may continue across the EU as now, based on operators’ commercial arrangements.

Some mobile operators (3, EE, O2 and Vodafone) have already said they have no current plans to change their approach to mobile roaming after the UK leaves the EU.

Will my business continue to be able to hold and transfer data and personal information without any interruptions after we have left the EU?

In the event of ‘no deal’, the UK does not intend to impose additional requirements on transfers of data from the UK to the EU. Therefore businesses will be able to send data to the EU as they do today.

However, businesses who want to receive personal data from organisations established in the EU (including data centres) should consider assisting their EU partners in identifying a legal basis for those transfers (such as standard contractual clauses). Guidance on standard contractual clauses and international transfers has been produced by the ICO.

If you only operate within the UK, you may not need to do much to prepare for data protection after we leave the EU. The UK is committed to the high standards of data protection set out in the General Data Protection Regulation (GDPR), and the government plans to incorporate the GDPR into UK law when we leave. Therefore, your best preparation for the future UK regime is to ensure that you are effectively complying with the GDPR now.

Will I be able to continue trading without tariffs with the EU in the future?

The UK will apply its MFN rates to goods imported into the UK from the EU. The government will determine and publish new UK duty rates before we leave the EU. They may be different from the EU’s current tariff rates.

The UK does not plan any immediate change to the classification of goods or deviation from the current commodity code list published in the UK Trade Tariff, which is currently applied by the EU, except where necessary to maintain alignment with international standards, or for trade remedies purposes.

Will I need to do additional customs-related paperwork, including import and export declarations, when trading with the EU?

In a no deal scenario, UK-EU trade will become subject to customs controls as third country goods are now. That means traders will have to submit customs declarations and be required to pay any duty due.

Will there be new health or safety-related inspections at the UK-EU border that my company will need to deal with?

The import controls for animals and animal products from EU countries will remain the same for Day 1. Animals and animal products from third countries, which transit through EU countries will have to be checked at the border before entering the UK because the current level of check undertaken for these commodities will be reduced when we are no longer a part of the EU.

Will my goods be subject to new customs rules, procedures and inspections at the UK or EU border in future? Could my shipments be held up and delayed?

In a no deal scenario, UK-EU trade will become subject to customs controls as third country goods are now. That means traders will have to submit customs declarations and be required to pay any duty due.

The Government has been consistently clear that we will not compromise on the security of the UK at the border, and keeping goods flowing over the border in a no deal scenario is of vital importance.

However, recognising the importance of maintaining security and facilitating trade flow at the border will not change HMRC’s commitment to promoting compliance and tackling avoidance and evasion to support a level and competitive playing field for law abiding UK businesses.

Will I still be able to fly people and/or goods between the UK and the EU after Brexit day – or could travel be disrupted?

The Government has always been committed to ensuring that flights between the UK and the EU can continue.

We welcome that the European Commission has published further detail on the measures that they will take to ensure that flights continue after the UK has left the EU in any scenario.

The combined reassurances from both sides should ensure that businesses and passengers can continue to book and travel with confidence. We look forward to engaging with the Commission and other Member States on the detail of these proposals to ensure that they deliver the continuity that both the EU and the UK want to see.

What rules of origin will I need to comply with once the UK has left the EU? Will I be able to count UK and EU content as single origin, both when trading with the EU and with third countries?

For UK/EU trade in no deal scenario:

  • In the event that the UK and the EU does not have a Free Trade Agreement (FTA) in place in a ‘no deal’ scenario, trade with the EU will be on non-preferential, World Trade Organisation terms. This means that Most Favoured Nation (MFN) tariffs and non-preferential rules of origin would apply to consignments between the UK and EU.

For UK-Third Country trade:

  • When the UK leaves the EU, the origin designation – or the ‘economic nationality’ – of our exports will shift from ‘EU’ originating, to ‘UK’ originating status.
  • We understand that, if suitable amendments are not made, this shift could impact on the ability of some exporters to meet the relevant rules of origin contained in existing EU Free Trade Agreements (FTAs).
  • Overall, we want to ensure that the rules of origin used in our continuity agreements enable businesses to continue to operate, as much as possible, through their established value and supply chains and this is particularly important where integration with EU content is significant.

Will my business be able to become a ‘trusted trader’ to move quickly through borders in future – and what will the process be?

HMRC already grant trusted trader status, known as Authorised Economic Operator (AEO). This will continue after EU Exit, and businesses can apply for AEO status now if they wish.

What, if any, procedures will my company face trading cross-border between Northern Ireland and the Republic of Ireland?

We aim to have as frictionless a border as possible between Northern Ireland and Ireland. Both the EU and the UK have stated explicitly that we will not accept any physical infrastructure including controls and checks at the border.

Our aim is to secure a deal that allows people and businesses to move and trade across the border as they currently do. That is what our proposals in the White Paper achieve.

Do I understand correctly, that companies need to apply to get a special status in order to be able to import the goods from the EU following a simplified procedure?

In the event that the UK leaves the EU without a deal, from 11pm GMT on 29 March 2019, many UK businesses will need to apply the same procedures to EU trade that apply when trading with the rest of the world. Currently, under import processes for trading with the rest of the world, goods are not released from customs control until companies make a full import declaration and pay the duty owed in full.

The UK’s Revenue and Customs department has therefore put in place transitional simplified procedures (TSP) to make it easier for UK companies to import goods from the EU using roll on roll off locations like Dover or the Channel Tunnel. This will be reviewed 3 to 6 months after they’re introduced on 29 March 2019.

  • So, it is not the EU companies who should seek such status – but rather their UK partners, who are importing their goods?

Yes. To register to use transitional simplified procedures businesses must be established in the UK and be importing from the EU into the UK. Businesses can register for TSP from 7 February 2019. 

  • What should the Slovenian (so EU) companies do at this particular moment? (just get in touch with their UK partners or something else)?

The UK Government has already sent a letter on this subject to 145,000 VAT registered UK businesses that trade with the EU (available onGOV.UK).  But Slovene businesses may wish to discuss this with their UK partners to ensure that all parties are preparing in case the UK leaves the EU without a deal in place.

HMRC is also reminding UK businesses to get an Economic Operator Registration and Identification (EORI) number if they do not already have one. This number is crucial to be able to trade after the UK leaves the EU, if we leave without a deal. It’s free and takes just 10 minutes toregister online.

  • What is this simplified procedure?

The new procedures reduce the amount of information importers need to give in an import declaration when the goods are crossing the border. They do this by allowing importers to defer:

  • giving a full declaration until after the goods have crossed the border
  • paying any duty until the month after import.

If tariffs apply to the goods that they import, and they want to use transitional simplified procedures, they will need to defer paying any import duties by setting up a direct debit.

We anticipate TSP will remain in place for more than a year to give businesses time to prepare to use the full customs processes that already apply to imports from non-EU countries. We’ll review the policy 3 to 6 months after it’s introduced on 29 March 2019 to see how it’s working. And we’ll consult with businesses and give them at least a 12-month notice period before withdrawing the easements in TSP and applying the usual customs processes to imports from the EU, to ensure they have time to prepare. 

If you have another question, please get in touch with us via email to spela.drobnic@bscc.si and we will try to answer it as soon as possible.

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