26 Sep 2017
The forthcoming withdrawal of the United Kingdom (UK) from the European Union (EU), commonly known as ‘Brexit’, is making many companies, such as exporters, importers and transporters, worry about the future.
Upon leaving the EU, trade agreements will also expire. There will be new rules and procedures for import from and export to the UK. Entrepreneurs are concerned that this may result in difficult customs procedures, higher costs and import duties, as well as delays at the border.
The withdrawal is scheduled for March 29th, 2019. Transitional measures will need to be put in place until a genuine trade agreement is concluded. There are several possibilities.
We have outlined five for you:
- Customs Union If the EU and the UK were to form a Customs Union, free movement will be applied for goods and services, though not for labor and capital. A ‘Common Customs Tariff’ (CCT) will apply to the import of goods across the external borders of the member states.
- Accession European Free Trade Association (EFTA) and European Economic Area (EEA) The EFTA consists of Norway, Iceland and Liechtenstein. The EFTA and EU have together formed the EEA agreement. Between Member States of the EEA, free movement of goods, services, persons and capital applies.
- Independent Free Trade Agreement The EU and the UK can enter into an independent, bilateral free trade agreement
- Agreements per sector The EU and the UK can conclude bilateral agreements per sector.
- ‘Most-favoured nation’ The UK can obtain ‘Most-favoured nation’ status, or MFN. This is an agreement between countries to grant the same trade opportunities as those granted to the “most favoured nation”.
Every year, an estimated 38 billion euros worth of goods are exported to the Netherlands from the UK. This is 2.3% of the Dutch GDP. The UK imports cargo worth 21 billion euros a year from the Netherlands. This makes the UK one of the Netherlands most important trading partners.
It is therefore essential that agreements are made quickly so that trade between the two countries continues to run as smoothly as it does now.
The consequences of the Brexit for the UK and the EU cannot be predicted. We will keep you posted on all further developments.