What does Brexit mean for freight forwarding?
Following on from the end of the Brexit transition period, moving goods between England, Scotland and Wales, and European Union countries has become more complicated. There is now a customs border between Great Britain and the EU, where previously there wasn’t. This will, of course, have consequences for the movement of goods between the EU and the countries of Great Britain.
Complicating things further, Northern Ireland, as part of the UK but not Great Britain, will remain part of the EU customs and VAT regime regarding trade with the rest of Ireland and the EU.
Businesses across Great Britain are now having to consider freight forwarding. Those that have already been using freight forwarding services will need to take account of the changes that have taken place.
What is freight forwarding?
A freight forwarder is a company that arranges for goods to be transported from one place to another. This will usually mean crossing international borders and customs jurisdictions. While this may sound simple enough, it actually involves a great deal of behind-the-scenes work to ensure your goods get from the supplier to the end destination with the minimum of fuss or delay. A good freight forwarder makes the whole process look seamless.
What does a freight forwarder take care of?
A freight forwarder will take care of a whole range of logistical issues to ensure your goods get to where they need to be. They have the experience and connections to make sure your goods are transported with the minimum of fuss. The range of tasks they take care of include:
Arranging transportation from origin to end destination.
Preparing all the relevant documentation, licenses and paperwork for export at the port or origin.
Booking and loading cargo for sea or air freight.
Preparing all of the necessary documents and relevant paperwork for UK customs authorities.
Arranging transportation and delivery to your UK destination.
What does Brexit mean for freight forwarding?
When the UK was a member of the European Union, there were no customs borders for British companies to negotiate when exporting to EU members. It virtually eliminated delays, and there were no customs duties to pay within the bloc.
From 1 January 2021, the countries in Great Britain left the EU customs union and VAT area. As a result of this, some customs paperwork now needs to be completed for moving goods, to or from the EU. VAT will also be payable on imports above £135.
In response to these changes, the government introduced legislation to help reduce the impact on businesses. However, each country retains its own unique regulations for the import and export of goods and services. Many UK companies are now considered international importers and exporters. In the case of suppliers who are based in the EU, they will now be regarded as international traders for the purposes of UK customs.
Freight forwarding helps businesses navigate these changes
The UK government has advised that businesses either invest in new computer systems with a comprehensive database of international custom requirements, or that they use a freight forwarding company. In most instances, it’s not practical for businesses to handle complex and varied customs requirements themselves. In such instances, using a freight forwarding company may be the most appropriate option.
A freight forwarding company can take the stress and confusion out of the whole process, freeing up your time to concentrate on your core business. With a freight forwarder taking care of your international logistics you can be confident that the whole process will be hitch-free.
How to use a freight forwarder following Brexit
When you opt to use a freight forwarder there are a number of issues that you will need to consider. These include:
As before the end of the Brexit transition period, your freight forwarder will expect you to use the harmonised system (HS)/commodity code system for exports to the EU. This is now more important than prior to Brexit, as it will impact on the amount of customs duties your end customers pay.
If you are importing goods into the UK, you will need to understand the UK’s Global Tariff System and ensure that you use the correct customs procedure code(CPC).
Proper record keeping
Keeping proper records is not only useful for your business, it is also a legal requirement. The UK government says that you must keep records of your trades for at least four years. This extends to six years in digital form if you are VAT registered.
Your freight forwarder will require a copy of the commercial invoice. This should detail the overall value of the goods, as well as the cost for shipping and associated insurance. The insurance will need to be recorded separately even if it has been included in the overall price you’re charging to your customer.
Liability and insurance
As part of the process of shipping your goods you will need to establish who ultimately has liability should there be any problems. Although this is unlikely, it can include damaged goods, shipping delays or injuries during transit. Your freight forwarder will offer a range of insurance options for you to choose from. While affordability is usually a fact in decision making, it shouldn’t be the only one. You should choose the option which is most appropriate for your particular freight and requirements.
Adapting to changing conditions
There was some confusion and frustration from many import and export businesses during the Brexit negotiation process, as so much detail remained uncertain for so long. Now the transition period has ended, the new procedures are beginning to bed in and UK businesses are adjusting to changed conditions. A freight forwarding company can take the confusion out of the process, helping businesses to adapt and continue trading in as seamless a way as possible.
Freight forwarding services from SSO Logistics
At SSO Logistics, we offer a full range of freight forwarding services. Working with a network of global agents we guarantee a quality service every step of the way. We undertake all aspects of freight forwarding including import, export, customs clearance, warehousing and storage. We have the flexibility to match the needs of each and every customer, whatever the size of their operation. We also have the facility to handle all types of cargo including vehicles, out of gauge equipment, heavy cargo, fragile and time sensitive materials.
Our success as a company is based on our attention to detail, flexibility and outstanding customer service. We take the hassle out of the process for our clients, taking care of all the hard work and complexity and allowing you to concentrate on your core business. Our response times are rapid, and we work hard to keep our prices competitive.
Ideally located between Liverpool and Manchester airports, with excellent access to Liverpool Seaport, we’re well placed to take care of your cargo.
Why not contact us today to find out how we take the hassle out of trading internationally?