SUPPORTING OUR CUSTOMERS - THROUGH BREXIT - DHL Guide
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SUPPORTING OUR CUSTOMERS THROUGH BREXIT 1
CONTENTS
01 02 03 04
Current Political How DHL Preparing
situation Engagement Express is your business
preparing
CURRENT SITUATION & LATEST UPDATES
Overview The Brexit transition period will conclude on 31 December. Negotiations are ongoing between the UK and the EU to secure a new Free Trade Agreement. In the meantime, goods continue to move between the UK and the EU as before, and DHL Express services remain unchanged. We know that certain elements (e.g. Customs checks) will apply to UK- EU shipments from 2021 regardless of the outcome, but if no agreement is reached, the UK will adopt World Trade Organisation standards and become what’s known as a ‘third country’. The content in this guide is based on our planning for this scenario.
DHL Express is preparing As international specialists, we’re already in a strong position, with existing customs teams, a successful global network and vast experience of international trade. Across the business we are making significant and continued investment with the aim of maintaining service quality throughout. Dedicated taskforces in the UK and Europe have been assessing every aspect of Brexit since 2016, considering all implications and risks. Our planning is based on available information. As requirements change, we will adapt, but some elements will be beyond our control and will have an impact across our sector. We will work together to overcome these challenges, and will inform you of any developments. Our determination to continue providing an excellent service for customers remains unchanged.
Timeline
18 OCT ‘19 1 JAN ‘21
PM secures new New trading rules apply.
withdrawal deal for
Parliament approval WTO rules assumed if no
Transition Period
new arrangement is secured
TODAY
31 DEC ’20
End of transition period
Final trade arrangements confirmed
The Northern Ireland Protocol
The Northern Ireland Protocol is designed to be a “fully legally-
operative solution”, whereby Northern Ireland (NI) remains part
of the UK’s customs territory, but aligns with EU Single Market rules.
NI will also remain in the UK VAT system, but in alignment with EU VAT
regulation (including access to the EU’s IT systems).
NO CHECKS
In practical terms, this means no customs procedures, regulatory
CHECKS
checks or tariffs will be enforced against trade between NI and the NO CHECKS
Republic of Ireland (ROI), and vice versa.
Goods moving between GB and NI will also be tariff-free, unless they
are deemed ‘at risk’ of entering the EU. Likewise, goods moving CHECKS
between ROI and NI that are ‘at risk’ of entering GB will also be subject
to tariffs.
NO CHECKS
Many questions remain regarding the Northern Ireland Protocol,
and the details are still subject to ongoing UK-EU negotiations. *Current working assumption
(September 2020)
REST OF EU
Changes to UK VAT From 1 January 2021, UK VAT on goods valued up to £135 will be collected at the point of sale, and not the point of import. This means that overseas businesses selling goods to be imported into the UK, valued between £0-135, will be required to charge and collect any VAT due at the time of sale. They must be registered for UK VAT and pay VAT using a UK VAT return. VAT registered UK importers can still choose to account for the VAT by providing their VAT registration to the supplier. For details see the ‘Business to business sales’ section here. Alongside this, Low Value Consignment Relief (LVCR) will be abolished, meaning VAT will be due at the time of sale on all imported goods valued £0 - £135.* More information is available here. * excludes excise goods and gifts
Changes to EU VAT The EU will be moving to a similar VAT collection model to that being introduced in the UK, however this will be effective from July 2021. When goods worth up to €150 are purchased from sellers outside the EU, VAT will be charged at the time of sale. The current €22 VAT threshold for importing goods into the EU will also be removed. This means VAT will be due on all non-document shipments from the UK to the EU. More information is available here.
Brexit Fee From 1 January 2021, a fee will be levied on all dutiable shipments between the UK and European Union countries, both inbound and outbound. With the information that is currently available, the intention is that this fee will be set at £0.25 per kg with a minimum charged amount of £4.50 per shipment. This fee may be adjusted, should circumstances change significantly. This fee will be introduced regardless of any trade deal agreed by the UK and EU, as the following will still apply: • Customs requirements for all shipments between the UK & EU. This results in an increase in the number of declarations, licenses, data submissions, overall processing, plus new IT systems • Border formalities will be introduced that must be complied with, i.e. the new ‘Border Ready’ requirements in Kent • Increased regulatory requirements restricting commodities into Europe • Increased Bond storage facilities and associated security The fee is applied per kg as heavier shipments in general have more complex customs requirements.
POLITICAL ENGAGEMENT
DHL is active with political engagement
DHL is working closely with EU and UK legislators, to help them understand the complexity and implications of the exit terms on businesses,
highlighting issues and calling for terms that are in the interest of our organisation and our customers.
CUSTOMS ROAD HAULAGE PORTS AVIATION IMMIGRATION
Simplified declarations Maintenance of current INFRASTRUCTURE European Aviation Safety Simple visa
& automatic release for road market access Allow for inspections Agency (EASA) an UK Civil requirements for
Authorised Economic with no rationing of away from the physical Aviation Authority (CAA) key workers
Operators (AEOs) / Inland international freight border / Reductions in memberships / An Open
pre-clearance / Use of permits / Mutual recognition planned checks for Skies Agreement, with
periodic payments / of driving licences and agri-food on both protection on investments /
Maintenance of special driver qualifications sides of the border Mutually-recognised cargo
customs procedures & vehicle standards security agreement
post-Brexit / Light touch international
trailer registration
Progress is being made across all topics listed above, but is dependent on ongoing negotiations, particularly around fisheries and the ‘level playing field’.WHAT WE ARE DOING AND HOW WE CAN HELP
As international specialists, we’re already in a strong position
We already have a number of key differentiators and all the expertise needed to support you following Brexit:
300+ 5+ million 7+ AEO
dedicated customs customs transactions bonded or customs warehouses in the DHL is an Authorised
professionals each year UK / plus at least one per EU country Economic Operator
WHAT IS AEO?
§ Authorised Economic Operator (AEO) § AEO enables us to leverage Customs
status is an international quality mark Freight Simplified Procedure (CFSP),
for companies whose customs which speeds goods release from
processes are secure and efficient Customs and allows deferred payments
Figures quoted are for DHL Express in the UKWhat is DHL doing to prepare?
Our expert taskforces in the UK and Europe have been assessing every aspect of Brexit since the referendum, considering all
implications for international trade.
DHL Express – Workstreams Network, hubs and ground operations planning, border issues management
ps
kO
or
e tw Contingency planning for air network
N
ine
Airl
Assessment of new requirements, including recruitment/training
UK Steering ms
Group and Custo
workstreams
HR Supporting impacted workers, recruiting additional workers
Global Steering IT Systems analysis, cross-border risk analysis, systems testing, data management
Group Fina
nce
Data analysis, VAT and Duty, Calculations/collection
Se c
urit
Co y
mm Security awareness and contingency planning
e rc
ial
Customer transition, Customer Operations Group, Customer Service considerationsDHL Express Contingency Planning
Enhance our Increasing our Minimise disruption Delivering service
1 systems and 2 resources to manage 3 to customer supply 4 quality for our
infrastructure future requirements chains customers
a) Changes to systems and tools a) Expanded Customs Agent capability a) Increase in network capabilities a) A dedicated ‘Brexit Control Tower’
to enable shipping if customs on/off shore to provide additional capacity to proactively monitor our network
regulations apply to EU where possible and action contingency plans
b) Mitigate transportation permit issues
b) Bond capacity increased to ensure driver access b) Significant and continued
for both the UK and EU If you will need additional investment with the
c) Additional people and resources Time Definite services by air, aim of providing as seamless
to enable increased duty please speak with your a service as possible,
and VAT collection account manager now in what may be challenging
requirements circumstances1. Enhance our systems and infrastructure § Standard Shipping Tools: Our IT systems have been reviewed and developed to ensure all systems are ready for product code changes and can accept increased customs requirements. This includes our electronic shipping tools. Changes required to our standard shipping tools (e.g. MyDHL+) will automatically be in place ready for 2021. § Bespoke Shipping Tools: Customers using a bespoke IT shipping tool (EDI or XML-PI) or use Shipment Import within EasyShip have already been advised of the changes required. Guides are available at www.DHLGuide.co.uk/Brexit. The ESS team can support with these updates. Contact ESS@DHL.com. § Bond Capacity: We have increased our bond capacity in the UK and EU, sourcing additional space and expanding our existing bonds. This will allow us to handle the increased number of bonded shipments we’re expecting when Customs requirements are applied to/from the EU.
2. Increase our resources to manage requirements Managing the impact of changing regulations § Customs: We anticipate an increase in customs entries of around 400%. We are continuing to recruit additional customs agents, both in the UK and offshore, to manage and process more customs entries. § Operations: Duty & VAT collection is likely to be required for EU shipments. We will employ and train approximately 150 additional couriers, plus 100 operational processors and support staff. § Vehicles: Investment in vehicles and equipment for the additional couriers. § Customer Service: An increased volume of queries is highly likely. We are recruiting additional customer service advisors to support and provide guidance. § Permits: New driver permits could be required in 2021. If required, we expect the UK Government to launch applications in Autumn 2020. We are working very closely with the UK Department for Transport to understand what vehicle access requirements will look like in 2021, and will look to attain the necessary documents as soon as they are available.
3. Minimise disruption to customer supply chains Preparing our network for a ‘WTO Trade Rules’ scenario: § Additional air entry/exit points in the UK opened Q4 2018, introducing greater capacity to our own air network § We are continually reviewing linehaul and sort hub capabilities & timings against customs-clearance deadlines § We expect to have less control over delays to our road-based services if there are delays at the ports. Customers may wish to consider moving day definite material to the time definite air network (where compatible), as there is a possibility our standard transit times for day definite road services will increase If you think you will need additional time definite air services, please discuss this with your account manager now.
4. Deliver service quality for our customers
We are investing to maintain our service standard throughout the transition.
UK Board
§ During Q4 2020 and Q1 2021, DHL Express will have a dedicated ‘Control Tower’,
proactively monitoring all aspects of our network and triggering contingency plans
where necessary
§ We will keep you informed of any developments that may impact shipments Brexit
Control Tower
§ Across the business we are making significant and continued investment We will be proactively
with the aim of providing as seamless a service as possible post-Brexit, monitoring and
in what will potentially be challenging circumstances ensuring any disruption
has the appropriate
contingency applied
EU
§ A large increase in resource requirements means a Brexit Fee will be introduced Regional Internal
for our EU Time Definite International and Day Definite International services. Control informers
TowerWHAT ABOUT YOUR BUSINESS?
Preparing for Customs in the EU
Already trading outside the EU? Only trading with the EU?
If you’re currently trading outside the If you’re currently only shipping within the EU, now is the time to familiarise
EU, you’ll be familiar with customs yourself with customs procedures. The following pages will highlight areas
requirements. Nonetheless, the where you can make customs clearance a smoother process. There are lots of
information that follows could still be help materials available in addition to this guide.
useful in helping you prepare.
Please review the content on Paperless We suggest reaching out to your local Chambers of Commerce for advice on
Trade, EORI numbers, Returns, and any specific paperwork required for your products
Delivery Duties Paid in particular. – they can produce Certificates of Origin (COO) or ATA Carnets, for example.
DHL Express will submit customs paperwork directly to Customs on your
behalf as we send your shipments. Providing the relevant documents via our
Paperless Trade option will help ensure swift customs processing.Preparing for Customs
in the EU
PLT is a service incorporated within our Electronic Shipping
Are you using Paperless Trade (PLT)? Tools to support digital submission of customs documents.
This provides a stable platform to work from, a reduction in
Yes Sometimes No potential delays (as our data-entry team have earlier visibility),
and no requirement for physical paperwork to accompany
shipments.
This service is already available for shipments outside the EU,
and we will be activating PLT for EU shipments from 2021.
We strongly advise setting up and using PLT now for any
applicable trade outside the EU.
*If certificates or licences are required, PLT cannot be used and hard copies must be provided.
**Most, but not all, countries accept PLT. Please ask your Account Manager for further info.Preparing for Customs
in the EU
An EORI number is an Economic Operator Registration and
Have you confirmed your EORI Identification number, required in order to release goods from
number with us? Customs. You currently only need an EORI number when
Yes No trading with countries outside the EU.
However, a GB EORI number will be required for UK imports
and exports from 2021.
VAT-registered businesses were automatically issued with an
EORI number in September 2019. Businesses without an EORI
can apply for free at www.gov.uk/eori. Numbers will be sent
by email within five working days.
As a priority, please inform our teams of your EORI number.
Please also include it on Commercial Invoices and Waybills
to promote smooth customs processing and clearance.Preparing for Customs
in the EU
When shipping internationally it is important to consider the
Have you checked if your content of your shipment, as documents and non- documents
shipments are classed as a are treated differently. While we currently do not differentiate
document or non-document? between the two when shipping to or from the EU, this will no
Yes No longer be the case from 2021.
It isn’t always obvious which category your shipment falls in to,
so please review our guide (using the drop-downs on the right)
or speak with your account manager.
Incorrectly marked shipments could result in delays,
or items being returned undelivered.Preparing for Customs
in the EU
The goods you are sending are identifiable via a precise,
Do you know the commodity internationally-recognised commodity (Harmonised System)
code for your product? code. This ensures the correct duties and taxes are applied by
Yes No
Customs. It can also be used to identify the duties and taxes
applicable in each country you’re sending to, but remember:
the exact rates that will apply in the EU for UK shipments are
yet to be agreed.
Certain goods may be subject to restrictions when shipping
them between the UK and the EU from 2021. If you have any
concerns, speak with your account manager now.
To identify the commodity code for your product(s) visit the UK
Government site here.
Note: you must ensure the commodity code is included on your
commercial / pro-forma invoice.Preparing for Customs
in the EU
Licences are required in a number of cases:
Are additional licences or certification
needed for your product?
• Goods considered to be military, dual-use, or subject
Yes No to control due to trade conventions, such as Washington
Convention or Kimberley Process
• CITES documentation, required for any movement
of endangered species
• An ATA Carnet, for goods being temporarily
exported/imported
• Certificates of Origin, required by certain destinations
If your goods do not need a licence, please confirm
to our teams at emahubcmfupdate@dhl.com
and ukexpcmf@dhl.comPreparing for Customs
in the EU
Certain goods may be subject to restrictions when shipping
Have you checked on the restrictions in
them between the UK and the EU from 2021.
the EU countries you’re sending to?
Yes No
Check if restrictions apply to the goods you’re sending using
our country profile guidance here.
Use the filters on the right hand side to select a destination.
If your products are on the list returned, please contact your
Account Manager as a priority, to discuss the exact
requirements for your shipments.Preparing for Customs
in the EU
Postponed VAT accounting will be applied to imports by VAT
Have you confirmed your VAT number?
registered traders from 2021. This allows VAT-registered UK
Yes No businesses to receive monthly import VAT statements from
HMRC, rather than pay these charges upfront.
There’s no extra charge to use this service, but if you wish to
postpone VAT payments, you must provide confirmation –
along with your VAT and EORI numbers – by email to
emahubcmfupdate@dhl.com.Preparing for Customs
in the EU
Goods that are deemed to be ‘dual-use’ or for military
Do you provide a declaration for application are subject to export controls.
controlled exports?
Yes No These rules are based upon the export of goods or technology
that can be used for military purposes, but the same
commodity codes can apply to a wide range of other goods.
You may need an Open General Export License (OGEL)
to export these items to the EU from 2021.
More information is available here.
Check whether your goods are subject to these controls here.
To conform with HMRC regulations, exporters should
provide a blanket declaration to confirm their goods are not
controlled.
In cases where goods are subject to controls, please ensure
you provide email pre-alerts to ukexport@dhl.com on the day
your goods are to be shipped.Preparing for Customs
in the EU
This is essential paperwork in order for your goods to clear
Have you completed a commercial Customs in the destination country. An annotated copy of this
or pro-forma invoice? is available here.
Yes No Detailed goods descriptions and HS codes for the products
you’re sending must be included.
It’s possible to produce a standard commercial or pro-forma
invoice within our shipping tools, (e.g. MyDHL+).
For DHL Express to clear shipments through customs on your
behalf, the following must accompany your shipment:
§ Commercial or pro-forma Invoice
§ Any relevant licences or certificates
§ The DHL waybill
§ A packing list (often required by destination Customs)
These documents can be submitted electronically using
Paperless Trade (PLT) – or attached to your shipment where
PLT is not accepted in the destination country.Preparing for Customs
in the EU
Opening a deferment account allows you to postpone the
Do you have a deferment account payment of import duties and VAT on goods imported by up
for Import Duties & VAT? to 46 days.
Yes No Apply here.
Please authorise us to clear your shipments using your
deferment account with form C1207N available here,
and advise us of your deferment account and if appropriate
your CCG (Customs Comprehensive Guarantee) reference
by emailing emahubcmfupdate@dhl.com.
Note: you will need to increase your deferment guarantee
if you expect to pay higher duty amounts.Preparing for Customs
in the EU
If you’re using one of our integrated shipping tools, in addition
Do you provide detailed customs to providing Customs paperwork digitally, entering a detailed
information via your integrated goods description, along with individual invoice line item
shipping tool? information is also advised.
Yes No This information can currently be supplied seamlessly through
direct integration with our bespoke shipping tools (e.g. EDI
or API).
This will be essential when the EU’s new Information Control
System 2 (ICS2) is introduced in March 2021. This system
provides critical data for EU customs authorities, which must
be submitted in advance of shipments being loaded at the
country of export.
Further information will follow for customers using our
standard shipping tools in advance of March 2021.Preparing for Customs
in the EU
Your returns policy could be impacted by Brexit.
Do you offer a simplified returns process?
Orders shipped into the EU on or before 31 December 2020
Yes No will fall under current free trade agreements. However, if your
customer then returns an item after this date, it will need
additional paperwork to facilitate Customs, and may be subject
to duties and taxes.
DHL can support you with understanding the requirements for
shipping cross border, non-EU returns back to the UK.
If you require support, get in touch now.Preparing for Customs
in the EU
By offering a DDP service, you can bill all duty and taxes back
Do you offer your customers a Delivery to your account instead of your customer being charged on
Duties Paid (DDP) service? receipt of their parcel.
Yes No Research shows retailers who send DDP are growing at double
the rate of those that choose for duty to be paid by the
customer on delivery, with the impact being 70 per cent
of online shoppers choosing to prepay duties and taxes
at checkout.Government & British Chambers of Commerce Support The latest Brexit information from DHL Express can be found at DHLGuide.co.uk/Brexit A lot of useful support material is available online, including the following: • UK Government Transition Guide • UK Government Imports and Exports Helpline • British Chambers of Commerce Brexit Hub • The European Union and the United Kingdom – forging a new partnership
THIS IS OUR FIELD OF EXPERTISE. Our Certified International Specialists are here to support you. By increasing the number of countries you trade with, you will reduce risk and increase the opportunities for growth. We’ll be with you every step of the way.
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