Brexit

Pitney Bowes Compliance Team · Pitney Bowes

 2 MINUTES

On October 31st, the United Kingdom may leave the European Union.  However, if the UK does not participate in the EU Parliamentary elections in May, the UK will leave the EU in June.

Because there are still many possible outcomes and constant developments for a potential Brexit, we are preparing for all likely scenarios.  While there have been conversations about delays and cancellations, the current general outcomes are:

  • Deal: Current cross-border tariffs, fees, charges and restrictions would remain the same until at least December 31, 2020.  Starting January 1, 2021, any new trade deals agreed upon during this time would go into effect.
  • No Participation in the EU elections:  Deal or no deal, the UK will leave the EU on June 1st at 11 pm GMT.
  • Participation in the EU elections and no Deal by October 31st: If there is no additional extension to Brexit, World Trade Organization (WTO) trading rules would start on October 31st at 11 pm GMT. As a result, our carriers are anticipating delays of 1-2 days depending on the destination; however, there may be expected further delays, which will be directly dependent on the UK customs and clearance process.  Any goods sold between the UK and the EU would be subject to the same requirements as goods from other countries that are not a part of the EU, including:
    • Customers shipping into the EU from the UK will be required to pay VAT, customs duties and potential clearance costs. Note that local VAT is currently charged on these purchases.
    • Without a free-trade agreement, goods will be subject to customs clearance and inspections.

Actions we’ve taken:
We are confident our extensive risk management will mean little, if any, impact on our customers whichever of the Brexit outcomes comes into force.  If there is no deal, we are ready to:

  • update duties and tax calculations
  • complete commercial invoices, licenses and customs clearance paperwork
  • utilize our European Union Registration and Identification number to allow for imports into the EU

What these changes mean for UK retailers and your customers:
No action is required by you to be able to continue selling into the EU.  However, we advise you to be prepared for the impact of the customs, duties and clearance fees that will be charged to your European customers.  Your Client Success Manager will work with you on an individual basis to determine the best conversion optimization strategy for you.  

Our ongoing focus on delivering excellence in client experience will continue regardless of the outcome.