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UK’s preferential trade status is unclear post-Brexit

On 20th January 2020, the German Customs administration (“Generalzolldirektion”) published a statement regarding the preferential trade status of the United Kingdom of Great Britain and Northern Ireland (UK) after its scheduled departure (“Brexit”) from the European Union (EU) on 31st January 2020. German Customs states that the status of preferential trade is not clear after Brexit; although the UK is scheduled to remain in the EU Customs Union during the “transition phase” (expected to last until the end of 2020), from a legal standpoint, after Brexit (starting on 1st February 2020) the UK will not be an agreement partner of the EU’s Free Trade Agreements. The European Commission has requested that EU member states continue to treat the UK as a member during the transition phase, however the Commission has not released any statement with respect to the outcome of this request. In addition, no statements have been issued by the European Commission regarding:

  • the preferential status (during the transition phase) of materials originating in the UK which are used in products produced in other EU member states,

  • the handling of supplier declarations for movement of goods within the EU, or

  • the implications for direct shipment rules during the transition phase.

Once PST has more information, we will reassess this situation and inform our customers accordingly.

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