Incoterms® summarise how costs and responsibilities are shared between buyer and seller. Many contracts use Ex Works for DDP but from 1st of January 2021 these terms may no longer be the best choice.
If you are selling Ex Works you will not be responsible for the Export declaration and therefore will have no right to access the documentation that proves that you do not need to pay VAT
If you are selling DDP you may need a VAT registration in the importing country and may have to find a broker to work on Indirect representation basis.
Using either of these terms, which are completely OK to use in within the EU, could easily cause complications and delays to your shipments to and from the UK from January 1st. We strongly suggest you review which terms are best for you.
You can find more details here:
ICC’s Incoterms® rules
Whether you are an exporter or an importer it is very important that you know the commodity code for the goods you are trading.
As an exporter you need to ensure you comply with any special permits, licenses or checks that might be required for your goods. As an importer you need to confirm the commodity code so that the appropriate tariffs are paid. It is your responsibility as the exporter and/or importer of record to provide the commodity code to your customs agent.
You can find the codes in the EU TARIC or UK TARIFF.
To trade between the EU and the UK you will need an Economic Operators Registration and Identification number.
If you previosuly held a European EORI number you will need to apply for a new UK EORI number. It‘s simple to do.
Simply follow the link here.
VAT will be payable from 1st January 2021 and if a trade deal cannot be agreed then duties will also be payable. It is important that you consider how you will pay for VAT and duties as you will need to have these arrangements in place before you can receive your goods.
If you are shipping the goods then it is important for your customer to consider this to avoid delays in receiving your shipment.
Each country treats the payment of duties and taxes differently. In some countries DB Schenker offers a deferment account facility which you should discuss with you r normal DB Schenker contact.
You may be able to apply for your own deferment account.
Your commercial invoice needs to have show the appropriate information so that export and import declarations can be completed correctly.
The information required is shown in this table:
Some products need additional licenses and checks. The list below will require full declarations in the UK and Pre-notification of shipment 24 hours before arriving at the UK port.
The types of products and the level of checks will increase from 1st January 2021 with additional requirements from April and full customs controls and systems from July. It is important that if you ship controlled goods you contact your DB Schenker customs team so they can help you plan what is required.
Full details of what UK requirements can be found in the UK Border Operating Model.
The EU requires full customs compliance from day 1.
January 1 2021:
April 1 2021:
July 1 2021:
The UK government has provided for the possibility of delaying full declarations and the payment of duties for 6 months from 1st January 2021. At DB Schenker we will be processing full declarations and Simplified Frontier Declarations for our customers.
You can find out more about Simplified Procedures and apply to use them here.
We think the best way for you to avoid delays to your shipments is to follow this guide and make sure you have all the steps in place for your customs journey well before January 1st 2021.
Like you DB Schenker is doing everything we can to prepare and we have our own contingency plans in place. There are some things that may well be out of our control and in these circumstances you may find it useful to have a level of safety stock of your goods.
You may have the skills in house to do declarations. If not it is highly recommend you use a customs agent to do the declarations for you.
The DB Schenker customs team have many years experience of delivering high volumes of customs declarations and can support you through the end of the transition period and into the new era of EU/UK trade.
If you would like DB Schenker to act as your direct representative to process declarations on your behalf then you will need to sign a Power of Attorney. As this is a legal document each country has it's own form.
Click here for National Procedures and how you can sign your Power of Attorney.
(PDF, 506.05 KB)
You can find the templates for these letters here: Direct Representative Letter and Export and Import Licence Letter
Click here or email ie.sm.dub.LAND-Customs-IE@dbschenker.com to return the completed letter to us.
As of December 8, 2020 – this information is supplied without liability.