Q&A: One of the most significant trade changes since 1973

Friday 31 December 2021

It seems that Brexit is the ‘gift’ which just keeps on giving. If you thought all the border changes came into effect at the beginning of 2021, it’s time to think again.

Through this year, many local businesses have been wrestling with supply issues, as the ‘chain’ adjusts to the new rules.

But, from the start of 2022, there will be a further change, caused by an interim arrangement coming to an end. It means Approved Traders will need to submit a declaration for their goods before they receive them.

Express asked Mark Cockerham, head of Jersey’s Customs and Immigration Service (JCIS), exactly what was changing, and what the effect might be…

For the past year, Customs have allowed Approved Traders to complete their customs declarations up to 30 days after receiving their imported goods, but that dispensation will end on 1 January, after which goods will be detained by Customs if the declaration has not been submitted on or before arrival.

It’s one of the most significant changes since 1973, when the UK joined the EU, and Jersey business are strongly advised to:

1. Look at their supply chain.

2. Determine what they are importing from the EU (some goods, although shipped from the EU, may not have originated in the EU and could be liable to duty).

3. Check that they have the skills / knowledge needed to manage the clearance procedure.

4. If they don’t have it in-house, get training or go to a customs agent.

The procedures for importers who are not Approved Traders will not change; they continue have to complete a declaration and pay the duties before their goods are released.

Does the change affect all goods, or just those being shipped through the EU? Does the same process apply to goods which don’t originate in the EU, but are shipped through the EU?

It affects all goods arriving from outside the UK/Crown Dependencies Customs Union – so goods from the EU, goods shipped though the EU, and goods imported from outside the EU.

Why could the 30 day dispensation not be retained to help importers?

Jersey is required to have the same measures in place as other members of the UK/Crown Dependencies Customs Union, and so this dispensation (easement) has to end. The easement was in place over 2021 to allow business to adjust to Brexit changes, so business have had a year to prepare, and this should not come as a surprise. 

Can anything be implemented to help cash-flow for businesses, as they may now have to pay the duty up front before selling the goods to the end-customer, and collecting a payment?

Businesses can register with JCIS to be an Approved Trader which will mean that, although a Customs declaration will still need to be made either pre-arrival or on arrival, the business has 30 days to pay any duty. Most importing businesses are already Approved Traders meaning they benefit from duty deferral, and this won’t change after 1 January.   

Will there be any ‘grace period’ or is a ‘hard stop’?

The grace period has been the 12 months since 1 January 2021 and is in line with the UK, where easements will end on 31 December 2021.

What is being done to help businesses manage the change?

Throughout 2021 there has been extensive engagement with trade bodies and individual business and we are now increasing engagement though further industry briefings, articles, and social media directing people to the fuller information on gov.je/brexit.

It is worth noting that, as Jersey is at the end of the supply chain, other global factors such as covid are adversely delaying production and supply of some goods. We want to minimise the likelihood of Customs measures causing delays, but there may be other factors which affect delivery.  

How will the process actually work? For example, will it be up to the freight company handling the goods to retain them pending duty clearance? What if they are perishable? What happens to them if duty is not forthcoming?

For traders who are not approved, the process should not change. 

For Approved Traders, goods will be detained until a declaration is made on the Customs’ online goods clearance system CAESAR. Once the declaration is made, the shipping company is automatically notified by CAESAR and the goods will be delivered. Approved Traders then have 30 days to settle any import duty.

Perishable goods will be fast tracked if a pre-arrival declaration has been made. Customs will avoid detaining any perishable goods unless there is good reason to do so – we want to work with businesses to ensure goods are delivered without unnecessary delay. 

Does this change have any resource implications for the JCIS or will it be managed within existing budgets?

JCIS have had no permanent additional resources to cope with the operational consequences of Brexit for both goods and immigration. In this respect staff are working diligently to ensure that whilst the appropriate revenue collection and clearance happens, there is no unnecessary delay to goods being delivered.

This article first appeared in Connect Magazine, which you can read HERE.