Withdrawal from the European Union
On 23 June 2016, the UK held a referendum on the question of whether or not the country should remain in the EU. After 51.9% of the electorate voted to leave, the United Kingdom notified the European Council on 29 March 2017 of its intention to leave the European Union. This officially triggered the withdrawal process in accordance with Article 50 of the Treaty on European Union. Withdrawal negotiations – a task without precedent – commenced on 19 June 2017. On 14 November 2018, after roughly a year and a half of negotiations, the European Commission and the British government concluded a Brexit deal laying out the arrangements for the UK’s departure from the EU, together with a political declaration setting out a framework for the future relationship between both sides. The withdrawal agreement provides the basis for an orderly Brexit process. On 25 November 2018, the European Council endorsed the withdrawal agreement and political declaration. In order to take effect, the agreement must be approved by the British parliament, the European Parliament and the Council of the European Union.
Article 50 of the Treaty on European Union
governs the process for withdrawing from the EU. If a member state declares its intention to leave the EU by triggering Article 50, withdrawal negotiations must be completed within two years. This deadline can be extended based on a unanimous decision by the European Council in agreement with the member state concerned. Furthermore, the European Court of Justice recently ruled that the UK can unilaterally retract its declaration to withdraw from the EU.
On 15 January 2018, the British parliament rejected the withdrawal agreement by a clear majority, and it remains to be seen what the British government and parliament decide.
The fact remains, however: if Brexit occurs either without a deal or on the basis of the negotiated withdrawal agreement that includes a transition period to 2020, during which time the UK would be treated “as a Member State”, the UK will eventually also leave the internal market and the customs union. These developments would bring about the introduction of customs formalities and customs controls for the movement of goods and people between the EU and the UK. This would happen either (a) in a disorderly fashion starting on 30 March 2019 or at a later date in 2019 (if the withdrawal deadline is extended without any further substantive changes) or (b) in accordance with the withdrawal agreement as soon as the agreed transition period expires.
How would a no-deal Brexit affect customs procedures?
If a no-deal Brexit occurs, the customs administration will treat the UK from this point on like any other third country that does not have a specific customs agreement with the EU. All customs provisions regulating the movement of goods and persons with third countries would apply immediately. The most important legislation that applies here is the Union Customs Code (UCC).
The Union Customs Code,
known officially as Regulation (EU) 952/2013 laying down the Union Customs Code (UCC), has been in effect since 1 May 2016. The UCC is the basic act for customs law in the EU, laying down the main features of EU customs law with an eye towards future priorities. More detailed customs provisions are stipulated in implementing legislation.
Importing goods into the European Union
After Brexit, all supplies of goods from the UK into the EU will have to be cleared through customs. This is because all goods brought into the customs territory of the EU are subject to customs supervision and must be placed under a specific customs procedure. This is indicated on a customs declaration that is submitted in electronic, written or verbal form. If goods brought into the EU have their final destination in the EU’s customs territory and are intended for commercial circulation there, they are subject to what is called the “release for free circulation” procedure. If goods are transported in unmodified condition between two locations within the customs territory of the EU, they must go through the “transit procedure”. The “temporary admission procedure” applies to goods that enter the customs territory of the EU to be used there temporarily for a specific purpose and then subsequently re-exported. Where appropriate, customs duties may be charged on goods imported into the EU’s customs territory. These duties are collected by customs authorities and remitted to the EU. Furthermore, customs controls may be conducted at any time.
The Central Customs Authority offers detailed information on customs declarations, customs procedures, customs duties and the customs value of goods.
Additional important aspects of customs law that apply to imports include: whether goods are subject to excise duties (this includes, for example, energy products, alcohol products and tobacco products), whether import VAT is due, and whether goods are subject to prohibitions or restrictions (this applies, for example, to weapons, plants and plant products). In addition, there are special customs-related provisions that can apply to imports: these include regulations under foreign trade and payments law (which apply to movements of cash, for example) or under market organisation rules (which apply to agricultural products). Furthermore, proof of origin may be required for goods imported into the EU.
Exporting goods from the European Union
All goods that are exported from the EU to a non-EU country must go through customs clearance, i.e. they must be declared for export in an export procedure. Distinctions may be made here between “final export”, “temporary export” and “re-export”. The export procedure generally involves two steps: First, the export procedure is initiated at the customs office of export. Second, the export procedure is completed at the customs office of exit and the goods are exported from the customs territory of the EU. Simplifications are permitted in many cases, however.
Currently, no customs duties are levied on exports. Exports are also exempt from VAT and excise duties. However, goods exported from the EU may be subject to customs and excise duties when they enter the country of destination. In addition, German domestic legislation on foreign trade and payments may apply as well: exports of certain goods may be prohibited or restricted (for example, in the case of weapons or embargoes).
The Central Customs Authority offers information on export procedures and foreign trade restrictions.
If the UK leaves the EU without a deal, travellers will be subject – from the moment the UK’s withdrawal becomes effective – to the same limits on quantity and value that apply to (return) trips from other non-EU countries (for example, limits on imports of goods subject to excise duties, including energy products, alcohol products and tobacco products). In cases where these limits on quantity or value are exceeded, the relevant goods must be declared to customs. Additional prohibitions and restrictions may apply (for example, on unauthorised medicines, exotic species or counterfeit goods).
The Central Customs Authority offers information on the rules that apply to travel.
Travellers who take high-value goods (such as sports equipment, camera equipment, computers and jewellery) with them on a trip are advised to bring along suitable verification in order to prevent doubts about the goods’ origin and avoid having to pay duties on them.
How is Germany preparing for Brexit? Public administration
Germany’s Finance Ministry and customs administration are working together closely to prepare thoroughly for the ramifications of various Brexit scenarios. It is important to note here that the UK’s departure from the EU will not cause the customs administration to take on any new tasks. German customs authorities are extremely well versed in processing the cross-border movement of goods. However, Brexit will increase the magnitude of this task, and the customs administration expects an elevated volume of clearance and control operations at specific locations. To prepare for this, the customs administration’s main aim is to ensure that it has the materials and staffing it needs to continue performing these functions effectively at major international seaports and airports. In addition, if a no-deal Brexit occurs, German customs will address this situation by placing a temporary priority on certain tasks and by facilitating these efforts through the flexible deployment of staff and through the IT-supported optimisation of clearance procedures.
In addition, Brexit will result in the need for additional staffing. Funding for 900 additional positions is set aside for this purpose in the 2019 Budget Act. These positions will be filled in stages. In addition to training junior staff, German customs will be hiring new employees in all relevant areas of its operations.
The challenges that Brexit poses cannot be met by the public administration alone. Businesses that actively engage in trade with the UK and that wish to continue to do so must likewise make preparations for Brexit. To this end, they need to review matters such as:
- whether their existing authorisations can be modified by a main customs office (e.g. to include additional countries; processing and storage sites in the UK)
- whether they need to apply to a main customs office for new authorisations, in particular the authorisation to operate a temporary storage facility for imported goods (please note that new applications require a certain period for processing)
The following information is for economic operators who engage in trade with the UK but who have so far been conducting business exclusively within the internal market and have therefore not yet had dealings with customs. For these economic operators, the following rules apply:
- They must register with the customs authorities. Upon request, the main customs office with local jurisdiction will issue an Economic Operators Registration and Identification (EORI) number.
- The exchange of information between economic operators and customs authorities (in the form of a customs declaration, for example) generally takes place in electronic form. This is done using ATLAS, an IT system that requires registration and certified software.
- In general, declarants must be resident in the EU.
- However, it is possible for representatives (such as customs agents) to complete customs formalities.
To raise the business community’s awareness of the impending changes, the German government teamed up with national business associations to organise a series of seven nationwide informational events on “Brexit and customs”, which were held from mid-September to early November 2018. At these events, experts from the Federal Ministry of Finance and the Central Customs Authority provided economic operators with information on customs formalities in the trading of goods with non-EU countries. In addition, participants were given an overview of special customs regulations (prohibitions and restrictions; foreign trade and payments law; preferences and origin of goods). The organisers also called on businesses to prepare for Brexit.
The events were attended by a total of approximately 1,500 persons. Participants stated that they found the explanations very useful in helping them to prepare for the Brexit process.
German customs: contact information
If you have questions for the German customs authorities, please contact:
Additional information on the preparations for Brexit is available from:
Both Germany and the European Union deeply regret the decision made by the people and government of the United Kingdom to withdraw from the EU. Nevertheless, the German government is preparing carefully for Brexit and is closely coordinating these preparations with its European partners and the European Commission.