Author - Rebecca Graham

Date published:

A Collection of Frequently Asked Questions from business about how COVID-19 is impacting global trade and the Chamber’s Global Services.

For a summary of all available support, from Government & members, please see here:

From the British Chambers of Commerce

Will airports and seaports remain open to ship goods?

UK seaports remain open. Operators state their intention to stay operational through the crisis subject, to evolving government guidance. The UK government updated its official guidance for seaports on COVID-19 on 19 March. This focuses on procedures for reporting and processing of cases in marine settings.

The global shipping industry reports disruption to freight movements, particularly to vessels inbound from Asia. This follows from factory shutdowns and other disruptions to production and logistics.

Airports worldwide remain open to freight movements, subject to official guidance. But the disruption to passenger flights and personal travel has affected air freight. Passenger planes carry just over half of the world’s air freight by weight: the reduction in passenger flights has forced up cargo rates for dedicated freight planes on some routes.

Will my business be able to send and receive goods internationally? And what happens to goods enroute to countries with closed borders?

Some countries are restricting export of goods judged to be essential in the coronavirus crisis. The UK has banned certain medicines from parallel export (where goods intended for UK patients are sold overseas).

The Department for International Trade has a dedicated Coronavirus web resource for companies that trade internationally. This includes a commitment to support importers find alternative overseas suppliers where supply chains are interrupted.

Will employees be able to travel in the UK or internationally?

Business should plan for an indefinite period of heavy restrictions to international travel across all regions of the globe. Official FCO guidance (correct as of 23/3/20):

‘As countries respond to the COVID-19 pandemic, including travel and border restrictions, the FCO advises British nationals against all but essential international travel. Any country or area may restrict travel without notice.’

For travel within the UK, businesses should check in with official guidance and news alerts on social distancing and self-isolation rules. Government advice on movement is evolving by the day.

From the North East England Chamber of Commerce

Is there any specific support for globally trading business?

The UK has announced a £330bn package to help business affected by the outbreak and to protect jobs. There are a wide range of support mechanisms summarised on our Chamber hub here.

Business are still able to benefit from UK Export Finance, which may help ease some payment pressure, offer insurance under late payment or access new markets. The Department for International Trade has a raft of guidance here.

Does import VAT come under the Government’s VAT deferment scheme?

The UK Government announced in the budget that at the end of the Brexit transition period (1st January 2021), they would introduce a postponed accounting mechanism for Import VAT of up to three months.

HMRC has confirmed that business will be allowed to apply for an extension of Import VAT & Duty from April 15th. HMRC will ask how COVID-19 has impacted your payment, and will decide on the length of extension on a case by case basis. Account holders should contact 03000 594243 or email [email protected].

Duty deferment account holders who are experiencing severe financial difficulty can contact HMRC for approval to enter into an extended period to make full or partial payment, without having their guarantee called upon or their deferment account suspended, the outstanding payment will not affect their duty deferment limit so they will not need to increase their guarantee to cover. You are not required to have a Duty Deferment Account to benefit.

What will COVID mean for the movement of goods?

While there are no changes at the UK frontier, there will likely be a reduction in capacity, as flights and staff are reduced, and an increase in cost. Reviewing strategies and preparing contingencies, such as storing more key stock, may alleviate supply pressures.

Goods arriving from outside the EU that are part of the UK’s effort to combat COVID-19 will no longer have duty or VAT charged. Government commodity code list and guidance here.

The Chamber has adopted measures to allow the continued processing of documents and certifications, including Letters of Credit, and can be done so remotely via our online platforms. Any business seeking clarification on any export issues or question is welcome to contact [email protected].

My business relies on essential imports to operate, is Government doing anything to prioritise supply?

Some products, especially raw materials, cannot be produced in the UK, and so must be imported for business. As mentioned above, there are no changes at the border, but time and cost may increase.

Constant communication with global suppliers and staying updated on their national or regional guidance is important, especially as further lockdown measures are taken.
The BCC is lobbying government to co-ordinate with global partners to ensure crucial supply chains remain operational.

Government acknowledges a propan-2-ol shortage, and HMRC has issued guidance for sanitiser producers on using alcohol substitutes here.

How will COVID impact Brexit negotiations?

The outbreak has severely restricted the ability, on both sides of the Channel, to deal with anything other than the virus. In addition, the Prime Minister and lead EU negotiators have been quarantined for testing positive for COVID-19, adding further restrictions to negotiations.

The progress of the negotiations has therefore faltered significantly, and while the talks are being closely monitored, the deadline for an extension to the transition phase is the 30th June 2020.

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