Applying for a financial guarantee from a bank is a key part of this process
Banking & Payments Federation Ireland (BPFI) is today urgently reminding SMEs that additional customs rules will come into force on January 1st for companies transiting goods through the UK landbridge to the EU. SMEs can still use the landbridge, but in order to reduce the burden of customs formalities as goods travel through the UK and onto the EU, they can use what is known as the Customs Transit Procedure.
Explaining the urgency of the matter, Brian Hayes, Chief Executive BPFI said: “With Brexit finally becoming a reality in just over 20 business days, the customs transit rules will kick in to play for SMEs who plan to transit goods to the EU using the UK landbridge. There are concerns that not all businesses are fully prepared. With 38% of all containerised Irish exports to EU continental ports moving through the UK land bridge, it is vital that Irish businesses are fully prepared for any necessary changes they need to make.”
To use this Customs Transit Procedure, among other steps, SMEs or their logistics partners must have a Revenue Comprehensive Guarantee which must be backed by a Financial Guarantee from a bank. For businesses using a customs agent or freight forwarder, it is important to be aware that logistics companies are also required to have this Comprehensive Guarantee, so SMEs should contact their logistics partner immediately to ensure this is in place.
Mr Hayes continued: “There is very little time left to make these arrangements and there are concerns that not all businesses are as prepared as they could be, so it is critical that SMEs take action if they have not already done so in order to avoid business disruption. Today we are calling on SMEs to get in touch with Revenue as well as their bank if they think they will need to use the Customs Transit Procedure and therefore need to have a supporting bank approved financial guarantee in place.”
BPFI ‘Brexit, Business & Banking’ Guide for SMEs
In light of this and other key financial considerations for SMEs relating to Brexit, BPFI has published a new ‘Brexit, Business & Banking’ Guide for SMEs, outlining key advice on financial and banking preparedness in the lead up to and the aftermath of Brexit. The Guide provides information on a range of banking related areas including custom guarantees, currency volatility, cashflow management, payment services and the range of Brexit supports available. Outlining the objective of the guide Mr Hayes explained:
“The COVID-19 pandemic has placed very harsh burdens on businesses and Brexit preparations may have suffered as a consequence. It has also been challenging for businesses to prepare for Brexit when the exact shape of it is still not clear at this late stage, but nonetheless, there are known implications that businesses need to consider to reduce the risk of disruption to business.
The objective of the guide we are publishing today is to highlight a number of important issues which we hope will prompt SMEs to review some of the more pressing Brexit-related financing requirements. It is important for SMEs to engage with their bank to ensure that they can arrange for any funding or guarantees needed to avoid undue disruption to business.”
Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland. Together with its affiliates, the Federation of International Banks in Ireland and the Fintech & Payments Association of Ireland, BPFI has 100 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.
For further information contact Jillian Heffernan, Head of Communications, email@example.com 087 9016880