UK to remain in Common Transit Convention after Brexit

UK to remain in Common Transit Convention after Brexit

24 December 2018

Continued membership of the convention will ensure simplified cross-border trade for UK businesses exporting their goods.

The UK is set to remain in the Common Transit Convention (CTC) after Brexit, simplifying some aspects of cross-border trade for UK businesses exporting their goods to other European countries.

Currently a member of the CTC while it is in the EU, the UK has now successfully negotiated membership in its own right after Brexit, the UK government announced yesterday (18 December). This would apply to any new trading relationship with the EU “or in the unlikely event of a no deal”, the UK government said.

The CTC is used for moving goods between the EU member states, the EFTA countries (Iceland, Norway, Liechtenstein and Switzerland) as well as Turkey, Macedonia and Serbia.

“Membership of the CTC will help ensure that trade moves freely between the UK and CTC members after the UK leaves the EU,” the government added. “It will provide cashflow benefits to traders and aid trade flow at key points of entry into the UK, as traders will only have to make customs declarations and pay import duties when they arrive at their final destination.”

UK Financial Secretary to the Treasury, Mel Stride said: We are a great trading nation and our goods are in demand all over the world. That’s why we are committed to ensuring that trade can continue to flow with as little friction as possible when we leave the EU.

“Membership of the convention will support traders both under a new trade agreement with the EU, or in the unlikely event of no deal. This gives businesses the continuity and certainty they need to plan for the future.”

Stride said membership of the CTC, and its supplementary convention the Convention on the Simplification of Formalities in the Trade of Goods, reduces administrative burdens on traders by removing the need for additional import-export declarations when transiting across multiple customs territories. It also provides cashflow benefits by allowing the movement of goods across a customs territory without the payment of duties until the final destination; countries that are not in the Convention would have to pay each time their goods crossed a border.

Commenting on the development, Pauline Bastidon, head of European policy and Brexit at the Freight Transport Association (FTA) said: “The invitation for the UK to join the Common Transit Convention (CTC) in its own right is great news for the country’s logistics industry, according to FTA, which has been pressing government and the EU to speed up the accession process for some time. In the event of no deal, traders making use of the CTC would be able to temporarily suspend the payment of duties and taxes, and to postpone customs clearance formalities until the goods reach their destination, rather than at the point of entry into the customs territory.

“This will be particularly attractive for UK businesses exporting into the EU. While it would not remove the need for border checks of a regulatory nature such as sanitary and phytosanitary checks on agri-food products, the CTC has the potential to reduce checks of a fiscal nature upon entry into the EU. What is now vital for UK business is to ensure that all necessary arrangements for use of the convention are made so that, from 30 March 2019, traders may fully benefit from the facilities offered by the CTC.”

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