1. Welcome to the ACITA National Meeting October 19th 2016

2. National Meeting Agenda
Welcome, Introduction & Housekeeping
Des Hiscock, ACITA Director General
Brexit Open Discussion and issues for JCCC
Facilitator: Des Hiscock
LUNCH
1.35 BREXIT Effect post Referendum
Stephen Booth, Open Europe
2.15 Legal views on Brexit and effects of UCC Jeremy White, Barrister 
3.00 – 6:00 “ACITA Brexit and Beyond” Social 

4. “Brexit and Beyond” 19th October 2016

5. What do we know?
The invoking of Article 50 of the Treaty of the European Union (EU) obliges the EU to negotiate a withdrawal agreement.
The agreement will be concluded on behalf of the EU by the Council, acting by qualified majority, after obtaining the consent of the European Parliament.
The Treaties of the EU would cease to apply to the UK from the date of entry into force of the withdrawal agreement or, failing which two years after the invoking of Article 50.
The 2 year negotiating period can only be extended by unanimous agreement of the remaining 27 EU member states.
During the 2 year negotiating period, EU Law would continue to apply to the UK.
The UK would continue to participate in EU business, but would not participate in internal EU discussions or decisions on its own withdrawal
Theresa May has confirmed that Article 50 will be invoked by “the first quarter of 2017” – the UK is therefore expected to leave the EU in the first quarter of 2019.

6. What don’t we know? Duty Impact? Intrastat? Port Delays? Freedom
Impact of Brexit on the movement of goods?
Impact of Brexit on the movement of services?
Impact of Brexit on multi-national supply chains?
What does Brexit mean for Importers & Exporters of goods?
FTA’s what is the future?
UCC where do we go from here?
Duty Impact?
Intrastat?
Port Delays?
Freedom
of Movement?
Export Licensing?
VAT Impact?
Royalties?
AEO?

7. (with single market access)
Current Status
(with single market access)
Post Brexit
Requirements
There are no UK customs statutes and UK Customs law stems directly from the applicable EU Regulations.
There will be a requirement to draft UK Customs regulations post Brexit. These are likely to mirror EU Customs regulations given the available resources and time frame. 
The UK Trade Tariff setting out rates of duty, eligibility for products to enter the EU and trade protection measures stems directly from the applicable EU regulations. There is no separate UK Customs tariff. 
All WTO members base their Customs Tariff on the WTO Harmonised system with classifications harmonised up to the first six digits. The UK will need to introduce its own Customs Tariff and set duty rates and import controls based on the WTO Harmonised system.
There is currently no requirement for Customs declarations on the movement of goods between EU member states.
Customs declarations will become mandatory resulting in additional administrative and resource costs on products moving between the UK and the EU and vice versa. This will place excessive strain on existing infrastructure and is expected to result in an increase to declaration costs for products originating outside the EU. 
Goods in free circulation within the EU can move across the EU borders without the payment of Customs duties irrespective of the origin of the goods.
The movement of goods between the UK and the EU will attract duties at the standard WTO rate (but may be varied by the terms of exit). The average duty rate for goods imported into the EU is approximately 4% but rates do vary from 0 to 217%.
50 preferential trade agreements are currently in place between the EU and third countries allowing preferential treatment for exports to and imports from those countries.
The UK will cease to benefit from the preferential treatment available in terms of these agreements and will need to develop its own expertise and process for negotiating such trade agreements with other countries.
85% of Customs duties accrue directly to a central EU fund contributing to the EU budget with member states sharing just 15% for handling and administration costs.
Customs duties will accrue directly to the UK exchequer leading to potential policy changes and the approach to audit based controls.
VAT on goods moving between businesses in different EU member states is subject to a reverse charge mechanism which is both cost and cash flow neutral.
Goods moving between the UK and the EU will be subject to the payment of import VAT (and a subsequent reclaim) instead of the reverse charge mechanism thus having cash flow implications.
Potential Challenges

8. Possible Models Possible Models Model Overviews EEA (but not EU)
Leave the EU, but remain part of the European Economic Area – this model currently provides Norway, Iceland and Lichtenstein with access to the single market. The Treaty provides for free movement of people, goods, services and capital – contributions to the EU budget are mandatory. Duty free treatment is only available to goods originating in signatory countries to the agreement. The treaty excludes agricultural and fisheries products.
EFTA
(European Free Trade Association)
The UK were founding members of EFTA, but today only Switzerland enjoys access to the single market through the 10 inter-related treaties that provide a slightly narrower scope to the EEA. The treaties include provision for the free movement of people and despite the Swiss passing legislation to restrict free movement through a quota system, the EU have reiterated that single market access will be revoked if this legislation is implemented. Duty free treatment is only available to goods originating in signatory countries to these agreements.
Customs Union Agreement
Turkey participates in a Customs Union agreement with the EU. The agreement does not cover services but does allow for duty free access to (or is restricted to) all goods, classified in chapters 33 to 97 of the WTO’s Harmonised system, which are in free circulation regardless of origin. Turkey is required to maintain the same external tariff as the EU and can only enter into trade agreements with other countries as part of the European Union.
FTA/s
(Free Trade Agreements/s)
The UK could seek to negotiate a comprehensive Free Trade Agreement/s (FTA/s) with the EU covering both goods and services. Duty free access would only be available to goods meeting the specific origin rules significantly increasing administrative requirements. Access to third country FTA’s; free movement of people; contributions to the EU budget; the inclusion of services; and compliance with EU laws and regulations would all be subject to the terms of the agreement/s.
WTO
(World Trade Organisation only relationship)
This is the purest form of “out” requiring no formal connections or negotiated agreements so the movement of all goods are subject to duty at the normal rate requiring Customs declarations and significantly increasing the administrative burden. WTO membership ensures that all members work to the same tariff so product classification is harmonised to a six digit level. Valuation rules, origin rules and Customs procedures (including reliefs) are common.
Possible Models

9. Possible Wish List?
First Sale for Export – key for sportswear industry
For Arrivals & Dispatches where currently statistical information is provided by Intrastats there should be a replacement system of Self-Assessment reporting which once up and running should then include imports and exports instead of Full Customs entries at the port or CSFP
Comprehensive Guarantees for potential duty should be abolished – if a trader has gone through the authorisation process then this should be sufficient for Customs to establish if the trader is ‘trusted’ and no guarantee is required
AEO – if a company is authorised for AEO then there should not be continuous audits.  There is a general concern that when a company is approved for AEO they are subject to more audits then non AEO company which is not acceptable as this should be the other way round
UK Tariff Suspensions for goods not produced in the UK – these still need to be in place to make UK goods competitive on the World Market (or EU market)
Multi-lateral and cumulation agreements for preferential trade need to be in place for when the UK exits the EU otherwise there is a major concern that goods sold for export will not be competitive on the World Market (or EU market)
Rather than Customs trying to start a new Customs Code and IP from scratch there is a preference that the UCC should be implemented with changes that the UK originally required but were out voted by other EU MS’s
There should be a full review of products covered by anti-dumping duties
What will trade want the Economic Test to look like after Brexit?
There should be a push for Deferred VAT accounting

10. National Meeting Agenda
LUNCH
1.35 BREXIT Effect post Referendum
Stephen Booth, Open Europe
Legal views on Brexit and effects of UCC
Jeremy White, Barrister 
3.00 – 6:00 “ACITA Brexit and Beyond” Social