The recent end of the transition period has brought the reality of Brexit into sharp focus for any business moving goods to and from the EU. Since January 1, 2021, EU law has ceased to apply in the UK, but, so far at least, the practical impact of Brexit on business has been commercial, not legal. Legislation has been passed to retain most existing EU law as UK domestic law, with wide powers for the Government to amend this going forward. The immediate issues facing business relate to arrangements for trade with the EU. Signed on December 24, 2020, the UK and EU trade relationship is now governed by the EU-UK Trade and Cooperation Agreement (TCA).
Under the TCA things are very different. The UK is now a “third country” and, consequently, the EU/UK trading relationship is subject to more restrictions and red tape. Most organisations will be affected to some degree; clearly, businesses with suppliers and/or customers in the EU must get to grips with the paperwork and compliance processes required under the new rules. A practical challenge for SMEs may be adapting to new requirements in relation to customs declarations, duties and taxes.
Understanding the practical implications and ensuring compliance with the new regime is essential and businesses face a steep learning curve over the next few months as they adapt to the new trading environment.
Amy Peacey is a senior associate in the Southampton office at Clarke Willmott LLP. She specialises in advising businesses on all matters relating to commercial contracts, including compliance with data protection legislation.