Brexit - Where are we now?

09 Aug 2019

With Boris Johnson now leader of the UK Conservative party and UK’s new Prime Minister the outcome of Brexit is looking increasingly worrying for those in the Irish Food & AgriBusiness sector. Therefore, now is the time to act, with less than 90 days until Borris Johnson intends to lead the UK out of the European Union.

ifac Food & AgriBusiness has compiled a comprehensive note into the various supports available to businesses wishing to best mitigate the risks associated with a hard Brexit, these include readiness measurements, funding supports, supply chain advice and tariff checkers as well as custom clearance support.

Brexit Readiness Support

There are several resources available to SME’s in order to measure their readiness for Brexit as well as advice how to best identify problem areas for them in the face of Brexit.

  • Enterprise Ireland’s Brexit Readiness tool is available online, here businesses provide information and the system will generate a report on how prepared it feels the business is for Brexit. Enterprise Ireland: Brexit Scorecard
  • Enterprise Ireland also provide a “Be Prepared” grant in order to fund an internal audit of your business to identify where you may be vulnerable in terms of Brexit and also what opportunities you may have in the wake of Brexit. Be Prepared Grant
Trading Resources

Many SME’s have products that are either being bought from, sold to or moving through the UK. These businesses will need to familiarise themselves with the customs and tariff system pre-Brexit, future planning is key.

  • The Revenue Commissioner advises all exporters to register for an EORI number which is necessary in order to trade with non-EU states. Revenue Commission - EORI Number
  • InterTradeIreland and Bord Bia provide information on tariff rates which will apply in the event that the EU and UK adopt rates similar to those currently being used by the WTO. InterTradeIreland: Tariff Checker
  • Bord Bia have also a compiled a report on how to manage Food and Drink supply chain and logistics in the wake of Brexit and how companies can deal with the changes and challenges Brexit will create. Food and Drink Supply Chain Guide
Funding Support

Accessing finance can be a major issue for many SME’s, however there are several options available to these businesses if they wish to use State Funding to help finance some of the operations they will implement to protect themselves against the threats that are there from Brexit.

  • Local Enterprise Offices offer a wide range of match funding for companies from the development to expansion stage of the business. Local Enterprise Office - Financial Supports
  • LEADER provide grants to businesses that improve rural tourism and rural enterprises once they meet certain criteria. LEADER - Home
  • The Strategic Banking Corporation of Ireland are also providing short-term loans under the Brexit Loan scheme which is available to both the primary agricultural sector as well as industry. These loans are available from a maximum interest rate of 4% over a period of 1-3 years. Loan amounts can range from €25,000 to €1.5m with up to €500,000 available unsecured. For more, see Brexit Loan Scheme
Mentoring / Consultancy support

Access to knowledge and expertise is a vital resource for any SME when trying to best prepare themselves for Brexit. There are several state funded mentoring services available to these businesses to allow them manage Brexit in the most efficient way possible.

  • Local Enterprise Offices provide a mentoring programme to businesses to advise them on how to best navigate the challenges created by Brexit. Brexit Mentoring
  • Enterprise Ireland also fund consultancy for businesses to provide advice for businesses and facilitate future growth. Strategic Consultancy Grant
Customs Clearance

It is vital that any business trading with the UK have an EORI number. It is also important to have the tariff code when dealing with the customs agent also. When choosing an agent make sure it is someone with an import agent on the import side e.g. Holyhead.

In practical terms this is what will happen:

  • Step 1: EORI number is needed and can be applied for through Revenue Online Service (ROS) as per above
  • Step 2: Client needs to authorise the agent to handle the export clearance (signed form required directors and/or secretary)
  • Step 3: Qualify the commodity code and type
  • Step 4: Customs declaration is issued providing the driver with a Movement Reference Number (MRN) that will allow them pass through customs.

The customs agent is not liable for the information on the export declaration, it is up to the company exporting the goods to ensure this is all correct.

Economic Operator Registration and Identification (EORI) number

All economic operators established on the Ireland of Ireland are eligible to register for an EORI number. The EORI number is available for immediate use following the application and there are no costs involved in registering for an EORI number and can be done through the Revenue Online Service (ROS). The EORI number is necessary for trade with non-EU countries. A businesses EORI number once registered will be “IE” followed by their VAT number.

For more, see Revenue: EORI Number

Authorized Economic Operator

Only after a business has successfully obtained an EORI number may they apply to be an Authorized Economic Operator. This is recognized around the European Union and allows for a smoother export process. Obtaining this number is done by completing an online application and is only issued following a visit of the business premises by Revenue officials. Being and Authorized Economic Operator assures buyers from abroad that products and facilities involved in the process are of a high standard.

For more, see Revenue: Authorized Economic Operator

Deferred Payment Account

The deferred payment system is an authorisation that allows you to defer payment of Customs Duty, VAT at import, Excise Duty and VRT. You must lodge a guarantee and comply with the conditions of the authorisation. Once approved, the authorisation allows you to pay the duties and taxes by direct debit in the following month.

For more, see Revenue: Deferred Payment Account

Binding Tariff Information (BTI)

Binding Tariff Information (BTI) is a legally binding tariff classification of goods. It is not a legal requirement, however it does provide assurance that your goods have the correct commodity code and is legally binding on all EU customs administrations. A BTI can be applied for from the Revenue Commission. This classification allows for uniform application of rules and classifications across the EU.

For more, see Revenue: Binding Tariff Information

Skillnet Clear Customs Training

Skillnet are providing free customs clearance training, this training is available for customs intermediaries, businesses currently involved or planning to move goods from, to or through the UK as well as those involved in logistics. The training is provided at locations nationwide via the Chartered Institute of Logistics and Transport. The training will develop the skills of attendees in the area of completing trade declarations via Customs clearance software, documentation requirements as well as transport procedures. To be eligible, businesses must have an EORI number, a CRO number and be incorporated in the Republic of Ireland.

For more, see Skillnet: Clear Customs Training

For further detail on the range of Brexit related supports, please see below.

Local Enterprise Office

Brexit Mentor Scheme

The Brexit Mentor Programme is designed to support LEO clients identify key areas of exposure in terms of Brexit and assist Owner / Managers in developing robust strategies to address issues and maximise potential opportunities.

The programme matches the knowledge, skills, insights and entrepreneurial capability of experienced business practitioners with small business owners/ managers who need practical and strategic one to one advice and guidance on planning for the impact of Brexit. The mentor contributes independent, informed observation and advice to aid decision making.

The Brexit Mentor Scheme is open to both new and existing businesses located in the LEO area.

Areas the Mentor Scheme can assist with include:

  • Business Strategy
  • Financial Planning
  • Sales & Marketing
  • Market Research
  • Intellectual Property & Compliance
  • Supply Chain Management.

For more, see Brexit Mentoring

Priming and Business Expansion Grants

The Priming Grant is a business start-up grant, available to micro enterprises within the first 18 months of start-up, whereas the Business Expansion Grant is designed to assist the business in its growth phase after the initial 18 month start-up period.

Grants may be available for sole traders, partnerships or limited companies that fulfill the following criteria:

  • Located and operating within the LEO’s geographic area
  • A business which on growth will fit the Enterprise Ireland portfolio
  • A business employing up to 10 employees
  • A manufacturing or internationally traded services business
  • A domestically traded service business with the potential to trade internationally

The maximum Grant payable shall be 50% of the investment or €150,000 whichever is the lesser.

Expenditure may be considered under the following headings:

  • Capital items
  • Salary costs
  • Consultancy/Innovation/Marketing costs
  • General overhead cost

For more, see Priming Grants and Business Expansion Grant

InterTradeIreland

Brexit: Start to Plan Voucher

This voucher scheme funds professional advice in relation to Brexit matters such as movement of labour, goods, services as well as currency management. 100% financial support of up to £2000/€2000 is available.

For more, see Start to Plan

Brexit: Implementation Voucher

This voucher from InterTradeIreland offers financial support to businesses to support them on the implementation of the Brexit plan. InterTradeIreland will pay 50% of the total cost of support of £5,000/€5,625. Applicants must be from an SME (250 employees or less) and Turnover < €50m.

For more, see Brexit: Implementation Voucher

Tariff Checker

In the event of a no deal Brexit, the tariffs placed on goods moving between the EU and UK would be in line with current WTO rates, it is likely the UK will register similar tariffs in the first instance for goods entering the UK. InterTradeIreland provides a full online search of tariff rates that will be placed on these goods.

For more, see Tariff Checker

Bord Bia

Customs Training

Applications are now open to participate in Bord Bia’s Customs & Tariffs Training which aims to provide practical training to companies on the basic principles and requirements of customs, tariffs and non-EU trade.

This will help companies prepare for Brexit and market diversification and will support current and new business development.

This training is available free of charge and companies can register for the training here - Custom Readiness Training

Brexit Barometer

Bord Bia’s 2019 Brexit Barometer is the third in a series of annual studies that provide a comprehensive measure of Brexit readiness across Ireland’s food and drink sector with findings from 130 companies. It is the basis and risk diagnostic tool from which Bord Bia offers a tailor made suite of supports to Ireland’s largest indigenous industry which is uniquely impacted by Brexit. The UK accounted for 37% (+2%) of all Irish food and drink exports last year, amounting to trade worth €4.5 billion.

For more, see Bord Bia’s Brexit Barometer 2019 Industry Findings

For more, see Bord Bia’s Brexit Barometer 2019 Recommendations

Enterprise Ireland

Brexit: Customs Insights course

The Customs Insights course helps businesses understand the key customs concepts, documentation and processes required to move goods from Ireland, to and through the UK. The course will provide participants with a firm understanding of the customs implications for their business and the options from Revenue to make this process more efficient.

For more, see Brexit: Customs Insights Course

Brexit: Act on Initiative

The Brexit: Act On programme has been developed to focus on three main areas of capability (1) Financial and Currency Management (2) Strategic Sourcing and (3) Customs and Logistics. Delivered over the course of two half day sessions with an independent consultant, the initiative helps companies decide on specific actions over a short period to address some of the risks and opportunities from Brexit. This initiative for Enterprise Ireland clients is delivered at no cost to the company.

For more, see Brexit: Act on Initiative

Be Prepared Grant

The Be Prepared Grant is designed for Enterprise Ireland clients who would benefit from further research and external expertise in examining their exposure to Brexit and exploring ways of addressing this.

The grant, which offers up to €5,000 or 50% of the total cost in financial support, can be used to help cover consultancy, travel and expenses for both domestic and international employee travel. The grant is intended to provide strategic support to clients to use internal resources or a third-party consultant to undertake a short project to determine how the company could respond to Brexit.

For more, see Be Prepared Grant

Market Discovery Fund

One of the key aims of the Market Discovery Fund is to specifically support companies in their market diversification plans. The grant aims to incentivise companies to research viable and sustainable market entry strategies. Companies can seek support to develop new geographic markets for existing/new products or develop new products for existing geographic markets. It provides support towards internal costs e.g. wages/ salaries, foreign travel and market research material and external costs e.g. market consultants, trade fair expenses, rental of temporary office space.

For more, see Market Discovery Fund

Brexit SME Scorecard

The Brexit SME Scorecard is a starting point to help businesses to begin preparing a strategy and ready their teams in terms of planning and shining a spotlight on some of the key operational areas that may be exposed post Brexit.

The Brexit SME Scorecard online tool has been designed to stimulate companies into thinking about the key areas that may be impacted in their business because of Brexit and to self-assess their level of readiness for Brexit. Using the ‘Brexit Scorecard’ online tool micro and smaller businesses can self-diagnose whether they are ready for Brexit.

By answering a series of questions online under six key business pillars a comprehensive report is automatically generated which serves as a prompt and discussion document for business owner / managers to consider as part of their planning for Brexit.

The report provides companies with a benchmark in terms of their level of preparedness against best practice and signposts them to a range of supports, resources and information available via Local Enterprise Offices.

To complete the Scorecard, see Brexit SME Scorecard

In summary, a hard Brexit scenario is now more realistic than ever and it is vital that all businesses, especially agrifood related businesses are availing of the supports to hand from the various government agencies and putting a Brexit strategy in place that will help mitigate some of the risks that will be faced in the coming months.

For help and advice on Brexit related issues or assistance on accessing support please do get in touch with the ifac Food & AgriBusiness team.

Contact David Leydon – davidleydon@ifac.ie

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We know that when you're in the thick of it it's not always easy to see where you are, how change might affect you, or where you need to go. Contact our team today.

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