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Dr Anna Jerzewska Profile picture
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29 Dec, 20 tweets, 7 min read
Better late than never. Here we go. What does this deal mean for borders, border formalities, customs & trade facilitation?

Long one. TL:DR very little at the moment but has potential

/1
Borders
When compared to no deal the deal changes very little in terms of border procedures. All formalities and checks will still be required.

Reminder - we're not starting from 0 here – both our container ports and our ro-ro ports are already congested

/2
On top of that, all the issues related to border readiness: lack of capacity and space, IT systems not ready, shortages of customs agents, treader readiness – have not been solved.

The deal doesn’t help with that.

/3
Here is where we are:
☑️The UK will phase-in border formalities over 6 months (customs and SPS)
☑️The EU will introduce full formalities in 3 days (customs + SPS)
☑️Irish Sea border also fully operational in 3 days with some short-term SPS easements

/4
Pre-notifications (safety & security declarations) not initially required on the UK side, needed for imports into the EU.

So what's in the deal?

/5
Anti-smuggling and safety&security checks according to each side’s criteria but signs of cooperation and data exchange.

Not much of that going on on the UK's side anyway in the first 6 months.

/6
Customs cooperation
The text is actually very good. Covers standard provisions plus elements from the WTO Trade Facilitation Agreement. It’s comprehensive and encouraging.

Plus we have a Protocol on Mutual Administrative Assistance in Customs Matters

/7
(Side note - further case in point that a Mutual Administrative Assistance agreement is not the same as a trade deal and can be signed with or without one)

/8

Non-committal language of the chapter in practice means that there is potential for deeper cooperation e.g. “consider developing joint initiatives” but no obligation.

This is in line with what we normally see in such chapters.

/9
For example 👇 from the UK’s initial proposal - a pilot for joint customs offices.

Again, plenty of scope for deeper cooperation but not initially.

/10
Ro-ro ports

Helpful language but less than in the UK's initial proposal. The EU did not commit to the proposed 2h time-limit for clearance.

/11
Pre-lodgement, advanced processing and exchange of information.

/12
Customs procedures
Full or simplified (deferred - UK). The key difference here vs no deal - no tariffs, provided that rules of origin are met. A quick explainer on how this will work below.

/13

Simplified procedures
Interesting provision. Both parties already have simplified procedures and have previously committed to introducing the ones they don't currently have. So this is not technically new. But perhaps there is scope here for something more. Eventually.

/14
AEO and mutual recognition.
This is good. Still not that many benefits of having AEO but mutual recognition is helpful.
Commitment to allow SMEs to qualify but not many SMEs are able to given the current criteria.

/15
The only thing is, as I have often pointed out - to get mutual recognition our AEO programme needs to be compatible with EU's AEO.

Meaning total revamping of UK's AEO programme isn't happening. We can't diverge that much

/16
SPS
Little if any changes vs no deal in terms of what needs to happen at the border.
Not much on SPS in general. Read more 👇 from SPS expert.

/17

Northern Ireland
Nothing in the deal but having a deal, in theory, means managing of the Irish Sea Border will be easier. With the new trusted trader programme and more than a light-touch approach to RoOs it should be easier.

/18
To sum it all up – in 3 days border procedures will look pretty much the same as they would under no deal. In terms of customs – obviously no tariffs (hello origin).

In the future, who knows, plenty of scope for deepening customs cooperation.

/19
And in case you'd like to know more about the deal and missed these excellent 🧵, check out.

@StevePeers -

@AntonSpisak


@NicoleSykes_


Plus non-stop coverage @DavidHenigUK

/end

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More from @AnnaJerzewska

Dr Anna Jerzewska Profile picture
28 Dec
So on origin, it’s getting a bit hard to keep up with all the rumours so here is where I think we are with this (correct me if I missed something)

/1
Claiming origin.
Two ways for traders to claim origin under the EU-UK deal:

1⃣ Self-certification by the exporter (standard) – normally requires an authorisation, I’m hearing that might not be needed for UK-EU trade – waiting for guidance or more info

/2
2⃣ Self-certification by the importer (new(ish), in the EU-Japan deal and some continuity deals). UK importers have little experience with this one, but helpful guidance available given initial uncertainty around using this form of certification

/3
Read 11 tweets
Dr Anna Jerzewska Profile picture
26 Dec
This is very interesting and seems that the may/ shall makes a difference after all. Let me explain how this was done and what it means.

/1
What normally happens is that a claim for preferential origin is made at the time of import i.e. certificate demonstrating that the goods meet rules of origin is presented with the goods.

/2
There are usually options to claim preferential treatment afterwords. Retrospectively. But only in special circumstances.

This is possible under domestic legislation (amending customs declarations)

/3
Read 11 tweets
Dr Anna Jerzewska Profile picture
26 Dec
While we're all digesting the details, quick point

There are two separate questions here:

1⃣ Is this a good deal for the UK vs what we had
2⃣ Is this a good FTA

And I think we should focus on the latter

/1
We’ve known the answer to the first question for years. The economic impact of an FTA is preferable only to a no deal outcome. But we’ve also known that these were the two option on the table for a while now.

/2
While I understand the sadness of losing so much, that actually happened a while back. And if you look at the EU list of what we've lost, most of it was to be expected

/3
Read 6 tweets
Dr Anna Jerzewska Profile picture
20 Dec
Once more, a reminder that for many firms this is the backdrop against which they are trying to finalise their Brexit prep:

1⃣ Continued uncertainty regarding deal/no-deal (tariffs)
2⃣ Ongoing pandemic and the impact on operations (staff, closures, stock)

/1
3⃣ Global supply chain crisis
4⃣ Congestion around the UK’s major container ports
5⃣ Disruptions at the UK's key ro-ro ports and queues

/2
6⃣ New lockdown rules and the loss of key retail period
7⃣ The new travel/movement restrictions and further delays this will cause to moving stock

/3
Read 6 tweets
Dr Anna Jerzewska Profile picture
20 Dec
Missed this. 18% of SMEs that believe they will be negatively impacted consider themselves prepared for 1 Jan (according to @fsb_policy).

18%. That is less than last year. With less than 2 weeks to go.

/1

eastmidlandsbusinesslink.co.uk/mag/news/less-…
68% of SMEs say it is due to ongoing uncertainty regarding the future deal and only 22% say it's due to covid which is surprising.

/2
While the Chairman calling for a "pro-enterprise free trade agreement" I hope it's clear that would only help in some areas.

/3
Read 4 tweets
Dr Anna Jerzewska Profile picture
13 Dec
Just as a reminder - without a freeze/ implementation period or some sort of derogation - no business on either side will be able to use the UK-EU FTA to avoid paying tariffs on 1 Jan even if we get one tomorrow.

It's already too late.

/1
Businesses simply won't have enough time to familiarise themselves with rules of origin, figure out whether their products meet them (larger companies have hundreds of SKUs) and understand what the certification requirements are.

/2
It is expected that companies would be able to self-certify origin under the UK-EU FTA but that is not always that straight forward and sometimes requires prior steps.

/3
Read 7 tweets

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