Revenue extends time for firms to swap to post-Brexit customs system

The Revenue Commissioners have given businesses more time to swap over to new customs IT systems as industry warns of "carnage" in January trying to manage post-Brexit checks.

In a sign that many small and medium-sized companies are not ready for new customs procedures on trade with Britain from the start of 2021, Revenue has extended, for the second time, the parallel running of new and old IT systems from next week until the end of March 2021.

Revenue agreed last month to permit the dual operation of a new system for processing imports, the Automated Import System (AIS), with the existing Automated Entry Processing (AEP) system until December 15th, but is extending it again as companies are still not prepared.

Engagement

So far, 47 of the top 50 agents and businesses which file import declarations are using the new system, but the transition is being extended “to allow remaining customs agents and businesses some additional time to complete their transition to the new system”, Revenue said.

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The move comes after Revenue said it had “listened to the concerns raised through ongoing engagement, and recognising that this is a very challenging environment for businesses both in terms of Brexit and Covid”.

Businesses have been asked to complete their transition to the new system well ahead of the March 31st, 2021 deadline when the dual running of the systems for imports will end.

AEP will continue to be used for exports.

The Government and Revenue have expressed concerns about the number of businesses that are not ready for new cross-border trade procedures, as the number of custom entries is set to soar from 1.5 million to 20 million a year after the UK leaves the EU single market and customs union.

Ports have warned that lorries will be turned away from ferries if they do not have the correct customs paperwork to allow them to travel, raising the prospect of traffic queues and delays.

‘Carnage’

“There is an expectation that there is going to be carnage in the first week of January with delays at ports,” said Simon McKeever, chief executive of the Irish Exporters’ Association.

Concerns have been expressed by businesses about the shortage of customs brokers. There is a large number of recruitment ads seeking brokers and clearance agents with just 20 days to Brexit coming into effect at the end of the 11-month transition period.

Mr McKeever said many large companies had grown inhouse customs brokerage businesses but smaller firms whose only international business has been customs-free with the UK do not have that expertise and rely on external customs brokerages or have to recruit or train up brokers.

The new customs procedures come into effect regardless of the outcome of ongoing negotiations between the EU and the UK on a potential post-Brexit trade deal.

“There is still a lack of knowledge amongst small businesses that they are going to face all these customs procedures, whether they are exporting or importing, whether there is or isn’t a deal,” said Mr McKeever.

Revenue warned that businesses that had not fully completed their preparations would be “immediately impacted” on January 1st, 2021 but said there was still time to register with Revenue for customs and have a facility to make customs declarations or recruit customs agents.