Brexit officially took effect on January 1, 2021

BREXIT? It is a contraction of the words “British” and “exit” that was created following the United Kingdom’s decision to leave the European Union (EU). Even though the decision was adopted by the English parliament on January 31, 2020, the UK still benefited from the EU free trade agreement, as they needed time to negotiate new agreements with foreign countries and in order not to disrupt economic activities already underway.

But the time for transition is now over for the UK. Their exit from the European Union was officially formalized on January 1, 2021. As borders have been re-established between this country and the rest of Europe, customs procedures are now mandatory for all trade entering or leaving the United Kingdom.

As of the new year, the UK is therefore no longer bound by the treaties signed by the EU regarding international trade relations, which includes the Canada-European Union Comprehensive Economic and Trade Agreement (CETA). In order to preserve their preferential status and their bilateral trade relations, Canada and the United Kingdom held negotiations in November 2020 to conclude a free trade agreement, which would maintain simplified trade between the two nations, despite Brexit.

On last December 9, the Minister of Small Business, Export Promotion and International Trade, Mary Ng, proposed Bill C-18 to the Canadian Parliament for the implementation of the Canada-United Kingdom Trade Continuity Agreement (Canada-UK TCA).

If the bill is passed in the House of Commons, the new agreement will preserve “the main benefits of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), including the elimination of tariffs on 98% of products exported to the United Kingdom, this agreement will maintain preferential access to the UK market for Canadian exporters, even as the United Kingdom exits CETA.”¹ However, we will have to wait until the return from the winter holiday recess of Canadian parliamentarians to find out the outcome of the vote on this bill.

In the meantime, a temporary free trade agreement has been put in place to ensure the status quo and avoid tariffs for importers and exporters on both sides of the Atlantic. In these times that are already fraught with uncertainty, governments of both nations agree that no one wants to complicate matters and further inconvenience traders with additional red tape.

Do you have a Canadian company that does business on the European continent? Do you think Brexit will have an impact on your import and export operations? Do you have plans to develop your economic activities on the international scene, but customs processes intimidate you and are hampering your momentum?

No problem, Cargolution is there to support you. Our experts in brokerage services and specializing in Canadian customs procedures will answer all your questions. We will take the time to explain and support you through the different processes. By letting us know where your ambitions lie, we will be able to identify your challenges and offer you personalized tips and advice depending on the nature of your business and your objectives. Because at Cargolution, informing our customers to help them evolve is our mission!

Don’t wait any longer to develop your international business opportunities! Contact our team now to learn all about the customs procedures that apply to your company for commercial trade abroad.