The UK left the EU on 31 January 2020 and entered into an 11 month transition period until 31 December 2020. During this period the UK Government and the European Commission aim to negotiate a new free trade agreement as the bedrock of the UK-EU future relationship.
During the transition period the UK remains bound by the rules of the EU’s Single Market and Customs Union, applying the EU aquis and remaining subject to the four freedoms of the EU (the free movement of goods, capital, services, and labour).
As there was no extension to the transition period the UK will no longer bound by these rules on 1 January 2021. UK businesses will then trade with the EU on either the new terms negotiated in a free trade agreement (FTA) or on WTO terms.
Irrespective of the outcome, whether there is a deal on an FTA basis, or the UK trades with the EU on WTO terms, there will be additional checks for imports and exports and therefore UK business must begin preparing now for the end of the transition period.
The Government has launched it’s ‘Let’s get going’ campaign to provide information for businesses to prepare and increase awareness of the changes that will take place. This has included:
- a new border operating model detailing how the UK border will work for importing and exporting firms,
- £705 million of investment for new infrastructure, jobs and technology at GB-EU border, including £470 million to build infrastructure such as border control posts, and £235m for IT systems,
- an updated gov.uk/transition page to serve as a hub for business preparedness,
- updated information from the ICO on personal data and data transfers after the end of the transition period,
- and in a separate release the Government has also set out guidance on changes to the e-commerce directive post transition period.
The European Commission has also released a collection of notices for EU based businesses, public bodies and citizens detailing how the end of the transition period will impact trade between the UK and the EU.
While guidance offered at this stage provides some clarity, it is by its nature incomplete due to the ongoing negotiations between the UK and the EU.
The UK Government has committed to release additional guidance and policy papers on the operation of the Northern Ireland protocol in the coming weeks as well as a plan to improve the effectiveness of the UK border by 2025.
techUK will continue to engage closely with Government as guidance is released and seek additional clarification where needed.