31 January, 2020 in Industry News

Brexit Day - so what next?

Today, 31st January 2020, the UK leaves the European Union.  Whilst this represents a significant milestone on the Brexit journey, it is only the beginning of complex negotiations on the practicalities of how the UK will do business in the future.


So what does this mean for you?

Effectively nothing changes until the end of the transition period, businesses will still trade under the same laws and regulations as they have previously done. During the transition period, the UK and EU governments will agree what their future relationship will be.


What is the potential impact for Northern Ireland?

Under the Withdrawal Agreement, there will be no tariffs or restrictions for Northern Ireland/ Republic of Ireland trade. The agreement also states that there will be no tariffs on goods moving from Great Britain to Northern Ireland unless the goods are “at risk” of being moved into the EU from Northern Ireland. Goods from third countries entering Northern Ireland will also be subject to a UK tariff unless they are being moved into the EU. At this point there is no definition of what “at risk” goods are and a Joint Committee will be set up to identify what these goods are.

Given that there will be no customs checks or controls between Northern Ireland and the Republic of Ireland, it seems inevitable that these checks must be carried out at the point of entry to Northern Ireland from Great Britain to ensure that the customs process remains intact.

During his election campaign, Boris Johnston stated that there would be “no forms, no checks, no barriers of any kind” for goods moving between Northern Ireland and Great Britain. However, on Tuesday 27th January in a speech at Queens University, the EU’s chief negotiator Michel Barnier stated ”In agreeing to the Protocol, the UK has agreed to a system of reinforced checks and controls for goods entering Northern Ireland from Great Britain”. This suggests that customs declarations will need to be completed and customs checks carried out, all of which will be unknown territory for many Northern Ireland businesses.

Whilst the Withdrawal Agreement sets out high level principles on how the UK will exit the EU, the practicalities of what this might entail has yet to be negotiated. This will be negotiated during the transition period. If no deal is agreed by the end of the transition period, the UK will exit without a trade deal which is effectively the same as a no-deal Brexit. If a deal is agreed, the UK will begin to operate under the new agreements from 1 January 2021. It will be a significant challenge for the parties to negotiate a satisfactory deal in less than 12 months.


What are the key dates?

  • 31 January 2020: UK leaves the EU at 23.00
  • 30 June 2020: This is the deadline for the UK to request an extension of the transition period beyond 31 December 2020
  • 31 December 2020: Deadline for a trade deal to be ratified (assuming there is no extension)


What can you do to prepare for 31 December 2020?

It is difficult for businesses to prepare for Brexit given that much of detail is still to be negotiated, however, there are a number of actions which you can take now to ensure you are ready to continue to trade successfully in the new regulatory environment:

  • Commodity Codes: Collate the commodity codes applicable to your traded goods.
  • Supply Chain: Map your supply chain, where are they based and what is the origin of the goods they supply to you? Identify high-risk relationships.
  • Customer Base: Review your customer base to determine the concentration of sales in various regions. Identify high-risk relationships.
  • Contracts: Review contracts with supplier and customers to determine whether there are any clauses which may relate to specific regulations or payment of tariffs.
  • Customs declarations: Understand what the implications are if customs declarations are required between GB and NI.


If you have any questions or would like to discuss proactive steps your business can take, please contact one of our Brexit team.

Catherine Martin, Anita Doris or Claire Pringle.

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Whilst every effort has been made by CavanaghKelly to ensure the accuracy of the information here, it cannot be guaranteed and neither CavanaghKelly nor any related entity shall have liability to any person who relies on the information herein. Information given here is for guidance only. Detailed professional advice should be taken before acting on any information contained herein. If having read the guidance here, you would like to discuss further; a member of our team would be pleased to help you.