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What is a Freeport?

What is a Freeport?

What is a Freeport?

By David Hooper, August 22, 2019, Category: General News

International Trade Secretary Liz Truss recently announced that the UK would create up to 10 freeports in the UK. She stated that they would create ‘thousands of jobs”.

  “Freedoms transformed London’s Docklands in the 1980s, and free ports will do the same for towns and cities across the UK” she added.

Mr Johnson backed the creation of new free ports as a Tory leadership candidate, suggesting there should be “about six” around the country.

Freeports are a special kind of port where normal tax and customs rules do not apply either at an airport or seaport. At a freeport, imports can enter with simplified customs documentation and without paying tariffs. Businesses operating inside designated areas in and around the port can manufacture goods using the imports and add value, before exporting again without ever facing the full tariffs or procedures.

If the goods move out of the freeport into another part of the country, however, they have to go through the full import process, including paying any tariffs.

Freeports are similar to free zones, or ‘enterprise zones’, which are designated areas subject to a broad array of special regulatory requirements, tax breaks and government support. The difference is that a freeport is designed to specifically encourage businesses that import, process and then re-export goods, rather than more general business support or regeneration objectives.

Would there be any benefit Post Brexit.

Most experts argue that benefits can be very small – the the University of Sussex recently put together a report on Freeports which suggested that the major risk was displacement of jobs from nearby areas as opposed to new job creation as well as providing other conclusions on why Freeports would be of little benefit to the UK Economy. In addition to this UK firms already benefit from the process of importing raw material duty and Vat free under the Inward Processing scheme, therefore, you could argue that any firms wishing to benefit from the process already can.

Future

The issue, therefore, should be about explaining to business what current procedures they should look at in the future to help offset any problems from loss of frictionless trade with the EU, and to help and encourage businesses to export to Non EU countries as creating expensive freeport areas is not the answer Post Brexit for the majority of firms involved in international trade.

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If you have any upcoming projects that we can support you on, please contact us directly on +44(0) 2476 343 037 and we’d be happy to help manage your freight journey.

Brexit Planning Workshop for Importers & Exporters

Brexit Planning Workshop for Importers & Exporters

Brexit Planning Workshop for Importers & Exporters

By David Hooper, August 09, 2019, Category: General News

In 2016 Boris Johnson, now the UK Prime Minister stated that:

  “We are proud to be running some workshops with the Coventry and Warwickshire Chamber of Commerce to help local businesses plan for Brexit. These will be full of content that you will find useful and allow you to make the decisions you need to make around Brexit.”

The first event is on 11th September.

Do you want to get your business Brexit ready but don’t know where to start? This workshop is designed for businesses that import & export and will cover the various aspects of international trade that will be affected by leaving the EU. It will also look at what steps you can take to prepare including conducting a supply chain audit, reviewing your customs processes and special procedures such as inward processing, outward processing and the AEO scheme.

This exciting workshop will bring you up to speed with the Brexit process and the key practical aspects of international trade that will be affected by Brexit including:

The Exit Process – What’s happening and when.

Trade Now and After Brexit:

  • How trade currently works with the EU and what will change
  • The current Single Market and Customs Union Model
  • Current Free Trade Agreement’s through the EU

The Post-Brexit Trading Models:

  • Customs Union, Single Market, Free Trade Agreement and their practical implications for importers and exporters
  • No Deal Implications
  • Practical Considerations such as tariffs, import VAT, customs declarations etc

Practical Steps to Take such as:

  • Conducting a supply chain audit
  • Using special procedures to minimise impact – for example IPR, OPR, AEO etc

Price:

  • Member: £250 + VAT
  • Non-Member: £295 + VAT

If you wish to book your place please contact Adele Wheatley adelew@cw-chamber.co.uk / 024 76654321

A Canada Style FTA post Brexit – what are the positive and negatives from this arrangement?

A Canada Style FTA post Brexit – what are the positive and negatives from this arrangement?

A Canada Style FTA post Brexit – what are the positive and negatives from this arrangement?

By David Hooper, August 08, 2019, Category: General News

In 2016 Boris Johnson, now the UK Prime Minister stated that:

  “I think we can strike a deal [with the EU] as the Canadians have done based on trade and getting rid of tariffs. It’s a very, very bright future I see.”

He was at the time referring to the fact that the UK could agree a deal with the EU based on the Free Trade Agreement the EU had agreed with the UK.

Some argue a deal like this could still be reached with the EU either before we leave on the 31st October or afterwards. However, even if a deal like this is agreed which most would agree is better than ‘No Deal’ this is still not the frictionless trade which many Politicians carelessly suggest.

The practicalities and complexities may actually be the same as no deal for other trying to prove that goods qualify under preferential rules of origin it could be even more bureaucratic.

POSITIVES:

Unlike ‘No Deal’ Tariffs would be eliminated on most products wholly produced or manufactured in the UK and EU – however, see rules of origin under negatives.

Public Procurement – businesses in the both UK and EU may still be able to bid for public contracts

NEGATIVES:

Businesses would need to do a Customs Declaration at import/ export – Incotmers would become even more important in understanding where risk and responsibility starts and finishes.

Businesses would need to meet complex rules of origin to ensure their goods 

Duty would still be payable on goods consigned from third countries imported into the UK or EU and then exported out to the UK and EU – due to the UK leaving the Customs Union. E.g. -A shipment is imported from China to the UK goods are repackaged and distributed to EU customers under this scenario duty would have to be paid twice once at import into the UK and again in the EU.

UK businesses will need to pay Import VAT albeit the Government originally stated under a ‘No Deal’ this could be deferred until the VAT return is made – however, for EU customers they may have to pay VAT before they can receive their goods. If they don’t have a deferment account this may lead to cash flow issues.

Any deal may only grant limited access to service contracts by no means comparable to access under the Single Market.

Therefore our advice all along is prepare for ‘No Deal’ now. Independent Freight Solutions Ltd is ready to support all of our valued existing and new customers in ensuring shipments will managed as smoothly as possible in the event of a ‘No Deal’ but preparing now is important to ensure you’re your business is ready. Independent Freight is a HMRC approved Authorised Economic Operator for AEO (C) Customs and (S) Security.  Out sister Company Hooper and Co can provide additional support by way of training/audits and consultancy on a whole range of international trade and customs related issues. If you would like to find out more about our Freight, Customs or Training Services – contact us