Sarah Halsted

Written by: Brad Ashton and Sarah Halsted

Sarah Halsted

Technical Associate Director

HMRC hints at plans for an electronic border with the EU

Reports have emerged online of further practical information on post Brexit customs processes, both for the border between the UK and the EU and for goods moving between Northern Ireland and the rest of the UK. 

It has already been announced that importers will initially have up to six months to complete formal customs declarations and pay any duty and VAT due on goods arriving from the EU.  However, under the Government’s border plans, at least some customs checks will be required with effect from 1 January 2021 on movements of goods crossing the UK/EU border and those being shipped between Northern Ireland and Great Britain.

The latest details appear to originate from selected slides shown at presentations given by HMRC to a private stakeholder group and, at the time of writing, have not been formally published by HMRC on the website. 

It is understood that the government will create a new electronic system, the Goods Vehicle Movement Service (GVMS), to allow customs and related declarations to be lodged with HMRC prior to the goods arriving at the port. HMRC will then apply risk-based checks to the declaration and relay the result to the haulier so they know whether the goods are cleared or require further checks by the time they disembark. The system will generate a GVMS reference number for the consignment that the haulier can present when required during the transport process. HMRC has reportedly told business representatives they plan to trial the GVMS in November.  The GVMS has the hallmarks of the existing EU Transit system.

Also, under the reported plans, ports and terminal operators will be asked to choose between two models to carry out customs processes.

  • A pre-lodgement model using the new GVMS, minimising the need for goods to wait in the port while customs processes are completed.
  • A temporary storage model providing storage for goods while customs declarations are made and customs clearance is given.

The border between the UK and the EU

In addition to the introduction of the GVMS and the pre lodgement or temporary storage models at UK ports receiving goods imported from the EU, it is expected that consignments of goods for export from the UK to the EU will also be required to obtain pre-clearance (permission to depart) from HMRC before arriving at the port of departure. 

The Northern Ireland border

Vendors of goods in Great Britain will be obliged to use the GVMS to complete three types of electronic paperwork for shipments to Northern Ireland:

  • an import declaration for all the goods being transported to Northern Ireland, as it will be covered by the EU Union Customs Code;
  • a safety and security declaration; and
  • a transit accompanying document which must remain with the vehicle at all times to satisfy EU requirements that the load which departs Great Britain is the same as the one that arrives in Northern Ireland.

Full details of the new procedures are not yet available for goods moving from Northern Ireland to Great Britain as they have yet to be determined by the EU/UK joint committee but HMRC indicates that, in the majority of cases, there should be no additional processes or paperwork and no change to how Northern Ireland goods arrive in Great Britain ports. However, export declarations may be required from Northern Ireland via the GVMS where required by specific international obligations binding on the UK or the EU (such as those related to endangered species or use of special customs procedures like duty suspense). 

Will it work?

While clearly intended to prevent delays at ports in the immediate aftermath of the UK’s departure from the EU customs union and single market, HMRC has set itself a stiff task to create a brand new electronic system to deal with huge volumes of imports and exports in time for 1 January 2021. Even if the system works smoothly, the end of the Brexit transition period will still bring many changes and administrative challenges to businesses who move goods cross-border, so it is important to begin the planning process now. 

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