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What does UK transition mean for businesses?

Posted on: 23/11/2020

The transition period for the UK leaving the EU ends on 31st December 2020 and cannot be extended. New rules for businesses trading within the EU will start from 1st January 2021. Now is the time for businesses to start thinking about the actions they need to take to prepare for January 2021. Whilst Government negotiations are ongoing, this process should be considered a ‘work-in-progress’ but urgent.

It’s important to understand that all businesses will be affected, no matter the sector they operate in or if they’re importing or exporting. The Government has released a Transition Period Master Checklist which provides a definitive list of actions required for all businesses.

Businesses need to understand which changes will affect them, in order to prepare accordingly and ensure they can continue trading from January 2021. For example, there will be changes to the way businesses can move goods across the border, how businesses provide services in EU markets, the immigration status of workforces and using personal data. The Government has created a checker tool for businesses to find out what changes will apply to them and get tailored advice on the actions they need to take.

Some key changes to consider

Changes to trade, importing and exporting, mean that businesses need to make sure they have an EORI number and also consider using a customs intermediary to make declarations for them. Businesses must also check if their goods need an import or export licence and make sure they understand their VAT responsibilities and what they may have to pay.

Businesses are encouraged to start using the UKCA mark as soon as possible after the 1st January 2021. However, to allow businesses time to adjust, CE marked goods that meet EU requirements can continue to be placed on the GB market until the 1st January 2022 – the deadline is longer for some sectors, such as medical devices and transportable pressure equipment. This is true even where an EU Notified Body has been used. If a business has already placed CE marked goods on the GB or EU market before the 1st January 2021, they don’t need to take any action for these goods.  From January 2022 businesses will need to use the new UKCA mark, on most new goods.

From 1st January 2021, freedom of movement of EU Citizens will end, and the UK will introduce a points-based immigration system. This new system will introduce job, salary and language requirements that may impact the ability to hire from the EU. This does not apply to EU citizens living in the UK before 31st December 2020, who can apply to the EU Settlement Scheme before 30th June 2021.

At the end of the transition period, if the UK has not received data adequacy decisions, the free flow of personal data from the EU to the UK will end. To continue to lawfully receive personal data from the EU, alternative transfer mechanisms will be required, as outlined in the EU GDPR.

How we can help

At Exemplas, we deliver public sector contracts working with SMEs to develop strategies for growth, resilience, innovation, internationalisation and much more. Due to this, we know the importance of businesses getting prepared for the end of the UK transition period, and through our services and projects we are on hand to support businesses through this time.

The Knowledge Bank is Hertfordshire Growth Hub’s exclusive online business resource hub, where you can find a wide range of tips, templates, guides covering a variety of topics, including the UK Transition. Our experienced Growth Account Managers are available to assist eligible businesses in Hertfordshire with the UK transition and other business issues and opportunities.

In addition, The UK’s Department for International Trade (DIT) has a network of specialist trade advisers available to help businesses prepare for new trade agreements, importing and exporting goods and providing services to EU or EFTA countries. We deliver DIT in the East of England and Yorkshire and the Humber regions.

The Enterprise Europe Network continues to support innovative SME’s with growth potential in the East of England. Our Innovation Growth Advisers can provide tailored innovation and growth support for any businesses with ambitions to internationalise before, during and after the UK Transition period.

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