Customs Summer Update

As many people who work in international trade know, one of the hardest tasks in any exporting role is keeping up with the number of acronyms used in day-to-day trade!  In this Business West summer update, I focus on three relatively new terms affecting exporters.

CBAM

One of the biggest changes to policy in recent years has been the introduction of the Carbon Border Adjustment Mechanism (CBAM), which will replace the Emissions Trading Scheme (ETS).  The six sectors which are currently affected are:

• Iron and Steel
• Aluminium
• Cement
• Fertilizer
• Hydrogen
• Electricity
  
  

These six commodities have been identified as some of the most carbon-intensive industries. The EU aims to put a fair carbon price on goods entering the EU. Ultimately, the EU importer oversees submitting a report; however, exporters need to correctly measure their carbon output when sending goods to the EU and provide these measurements to the importer.

With a UK CBAM due to be announced soon, companies (including those in the Glass and Ceramics sectors, which will be affected by the UK CBAM) will need to act now to stay ahead of the competition.

Business West are one of the first companies in the UK to have completed a CBAM audit for a customer and can help companies stay on top of changing legislation so that you can confidently calculate the data needed for CBAM reports and potentially win new EU trade by displaying CBAM compliance.

EUDR

The European Union Deforestation Regulation (EUDR) is another green policy introduced by the EU. It aims to combat goods imported from deforested areas. The new rules will replace the EU Timber Regulations (EUTR) but will not just affect the timber industry. The cattle, Cocoa, Coffee, Palm Oil, Rubber, and Soya sectors will also be affected.

The new regulation requires companies to perform due diligence checks on the goods entering their supply chain. Attention will need to be focused on exactly where the goods were harvested and their traceability.

The UK still adheres to UK Timber Regulations (UKTR), so currently, companies will only need to adhere to EUDR if exporting to the EU. The ability to display due diligence within the supply chain is likely to prompt exporters to act fast so that EU importers can keep on top of reporting once the first report is due in December 2024.

If your company trades with any of the affected commodities, it would be worth contacting Business West. We can advise on what data is needed to be compliant with EUDR.

CUC

The introduction of the Common User Charge (CUC) in April, as part of the Border Target Operating Model (BTOM) rollout, has caused some confusion for businesses that import plants and food that are considered a risk when entering the UK.

Businesses that trade in affected commodities will now need to pay a charge when importing goods into the UK, based on the risk factor of the food or plant being imported. Goods will need to be declared on import of products, animals, food and feed system (IPAFFS), with a maximum charge of £145 per consignment. Failure to comply has resulted in consignments being seriously delayed at Sevington, along with fines being applied for goods that have been wrongly declared.

It is becoming increasingly important to rely on a customs agent who understands the restrictions that apply to commodities so that delays and further charges do not occur at the border. With over 10 years’ experience in the food and drink sector, Business West can help with any import declarations and queries you have about these types of consignments.

Contact Customs Agent, Joseph Goldsworthy for advice on any of these issues now.