Tariff free trade between the UK and EU

January 12, 2021

Tariff free trade between the UK and EU


Tariff free trade between the UK and EU

As announced just before Christmas the UK and EU agreed a trade deal which heralded tariff free trade.

The Trade and Cooperation Agreement (“TCA”) was agreed between the UK and EU and came into force at 11pm on 31 December 2020.

In order for goods to be tariff free under the TCA they have to be of UK or EU origin as defined by the preferential rules of origin set out in the TCA.

If goods do not qualify under the preferential rules of origin, tariffs will be due on imports to the UK from the EU and vice versa.  The tariffs into the UK will be under the UK Global Tariff and into the EU under the Common External Tariff.

There are two ways in which goods may be considered to be originating in the EU or UK:

Wholly obtained – As set out in the Government guidance “These are goods that have been exclusively obtained or produced in the territory of one country, without using materials from any other country.”

Substantially transformed – The TCA sets out detailed product specific rules (“PSR”) for determining whether the processing that has been carried out on materials from outside of the UK or EU makes the final product satisfy the origin requirements.

Therefore, in a simple situation where you import goods into the UK from outside of the EU and then subsequently export these into the EU without undertaking any process, tariffs could be due on the import into the UK depending on the UK rules but in any event would be due on the subsequent import into the EU.  The situation where goods are subject to any form of process can be complex.

When importing from or exporting to the EU additional documentation will now need to be kept regarding the place of origin of products and customs declarations will need to be made to claim preferential origin.

Traders will have up to six months to complete customs declarations for goods imported into the UK (but not the EU) between 1 January 2021 and 30 June 2021.

This is a complex area and will most likely require the assistance of your freight forwarding or logistics company or that of a customs expert.


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PLEASE NOTE: By the very nature of this type of information the details of tax law might have changed since they were published, so contact your Barnes Roffe partner before acting on any matter contained in these documents.