Preferential customs treatment in the goods trade between the EU and the United Kingdom as of 1 January 2021 (updated on 7 January 2021)
On 24 December 2020, the EU and the United Kingdom reached a conclusion on a trade agreement which is to be applied temporarily until a final agreement can be ratified at a later date. This temporary trade agreement contains regulation on reciprocal preferential treatment of goods originating from the EU and the United Kingdom. According to the regulations, customs duty is not levied when goods are considered to be originating products covered by the agreement.
Originating products under the agreement
In order for goods to qualify for preferential customs treatment upon importation to the European Union or the United Kingdom, they must be originating products from one of the agreement parties and comply with the rules of origin laid down in the agreement. You must always check the product-specific rules of origin for making sure that your products qualify for preferential treatment before a certificate of origin is drafted on them. Product-specific rules of origin lay down the prerequisites for considering a product to meet the standards of an originating product. Product-specific rules of origin are included in Annex ORIG-1 (pages 415-477) containing the rules of origin of the trade agreement.
Proofs of origin
The qualification of products for preferential treatment must be proved in the country of importation with a certificate of origin to be presented in connection with the customs declaration. As per the agreement between the EU and the United Kingdom, acceptable certificates of origin are a statement on origin by the exporter or importer’s knowledge.
The format of a fixed-form statement on origin by the exporter is defined in Annex ORIG-4 (pages 482-483) of the rules of origin of the trade agreement. A statement on origin can concern only a single consignment or several consignments of similar products of origin. Statements on origin can be issued by all EU exporters for consignments that contain products of origin for a maximum value of 6 000 euros. Only companies registered in the REX system can submit statements on origin for consignments exceeding that value. In such cases, a company must include its individual REX identification number in the statement on origin. Customs gives the ID number to companies when they register in the REX system. If an exporter has already registered with Customs, for example, as an exporter of EU-originating products to Japan, Canada or to a GSP beneficiary country, then the same FIREX number is used also in statements on origin concerning EU-originating products exported to the United Kingdom. Exporters to the United Kingdom are to enter their EORI numbers under the ID number regardless of the value of the consignment.
A statement on origin can also be issued as a long-term insurance for several consignments of similar products of origin where the exporter delivers identical products to a customer on a regular basis. A long-term statement on origin can cover a maximum period of 12 months, and the period of validity must be indicated separately in the certificate.
Statement on origin template:
(Period: from…………… to …………(1) )
The exporter of the products covered by this document (Exporter Reference No ……... (2)) declares that, except where otherwise clearly indicated, these products are of (3)...………preferential origin.
(Place and date)
(Name of the exporter)
Under section 2 of the statement on origin, EU exporters enter the REX number. UK exporters enter the EORI number. Under section 3, you enter either “the United Kingdom” or “the Union” as the origin depending on the preferential treatment origin. Under section 4, you do not need to enter the location and date if that information is already included in the document. If the statement on origin concerns several consignments of similar products of origin, you must enter also enter the validity period of the statement under section 1. The validity period cannot exceed 12 months.
An importer can request preferential treatment also based on importer’s knowledge. Any fixed-form statement on origin text is not required in a request for preferential treatment based on importer’s knowledge. However, the request must be based on information and documentary proof from the exporter that can be presented to Customs, when necessary, for proving that the item in question is a product of origin that meets the requirements of the rules of origin. Unlike exporters, importers do not have to be registered in the REX system of the EU.
Customs clearance of products qualified for preferential treatment
When an importer requests preferential treatment for products of origin from the United Kingdom, they must enter the document code for the type of origin clearance based on which they request preferential treatment. In preferential treatment based on a statement on origin, the document code for a single consignment is U116. For a statement on origin concerning several consignments, the code is U118. In a request for preferential treatment based on importer’s knowledge, the document code is U117.
Retrospective request for preferential treatment
According to the trade agreement between the EU and the UK, preferential treatment can be requested within three years from the date of importation.
Cumulation in trade between the EU and the United Kingdom
Article 4 of the agreement on cumulation of origin provides for mutual full cumulation. This means that, in addition to materials of origin originating in the EU or the United Kingdom that qualify for preferential treatment, processing of non-origin materials carried out by an agreement party can be taken into consideration in determining the origin of the end-product. However, the production measures carried out in the territory of the other agreement party must exceed the measures referred to in Article 7 of the rules of origin.
An EU exporter who wishes to make use of processing procedures done on non-origin materials in the UK must receive a supplier’s declaration referred to in Annex ORIG-3 to the rules of origin. A supplier’s declaration can be issued for a single consignment with an invoice or any other document that describes the products accurately enough for identifying them. The template for a supplier’s declaration on a single consignment is presented in Annex ORIG-3, Appendix 1 to the rules of origin in the agreement. A supplier’s declaration can be submitted as a long-term declaration when a supplier regularly delivers such products to the exporter that have the same unaltered essential qualities in terms of determining their origin that qualifies them for preferential treatment. The format for a long-term declaration is defined in Annex ORIG-3 Annex 2 to the rules of origin in the agreement.
A supplier who drafts a long-term declaration must be prepared to deliver all appropriate documents requested by the customs authority for proving that the information in the supplier’s declaration is correct.
PLEASE NOTE! Obtaining supplier’s declarations is allowed retrospectively from 1 January 2021 to 31 December 2021.
The Commission has released preliminary information about an implementing regulation to be issued on 31 December 2020 based on which operators engaging in trade between the EU and the UK can apply the transition period in obtaining supplier’s declarations. Between 1 January and 31 December 2021, businesses can draft statements on origin qualifying their goods for preferential treatment in the framework of the EU-UK trade agreement without supplier’s declarations provided for by the agreement. However, exporters must always have information on the qualification of goods for preferential treatment when they draft statements on origin qualifying goods for preferential treatment. Exporters should have the supplier’s declarations on which statements on origin are based on no later than 1 January 2022. If an exporter does is not able to retrospectively obtain supplier’s declarations, they should inform the importer in the country of destination.
See also general instructions on the application of preferential treatment in import and export, and instructions on how to enter the REX system:
Preferential treatment of goods based on origin - Customs
Preferential treatment in export for originating products - Customs
Registered exporter (REX) - Customs
Trade and cooperation agreement between the EU and the United Kingdom:
The draft EU-UK Trade and Cooperation Agreement | European Commission (europa.eu)
Commission website on the relations between the European Union and the United Kingdom:
The European Union and the United Kingdom – forging a new partnership | European Commission (europa.eu)
Commission website on Brexit in Finnish:
BREXIT – MITEN VALMISTAUTUA SIIRTYMÄKAUDEN PÄÄTTYMISEEN? | Taxation and Customs Union (europa.eu)
Customer support for businesses
The Brexit support line serves customers from Monday to Friday, 9 a.m. to 11 a.m., at +358 295 521 008, and by email at yritysneuvonta.lupa-asiakkaat(at)tulli.fi.