But even with a free trade agreement, there is still a lot of homework to be done for exporters to the UK.

Let’s go back: at the end of October 2019, British Prime Minister Boris Johnson concluded a withdrawal agreement with the EU and on January 31, 2020, the UK officially left the EU.

At least on paper, because in practice it is still business as usual as a one-year transitional period is foreseen for the EU and the UK to reach a free trade agreement to avoid a hard Brexit.

Only the conversations did not go very smoothly.

Two stumbling blocks

The EU and the UK have not yet reached an agreement because of:

1. Fish. The British want to limit access to their territorial waters, while the EU wants free access as it is today.
2. Competition. The British want unrestricted access to the EU market. That is possible, says the EU, but only if the goods meet our strict environmental, labor or state aid standards. And that goes against the idea of British national sovereignty.

But even if a miracle were to happen and a hard Brexit is avoided, hard nuts would still be left to crack for European exporters to the UK.

British volatility

To be prepared for Brexit, many exporters have calculated the financial impact of this on their business. The import tariffs that the UK would levy as of 2021 were an important parameter in this respect.

However, a new decision by the British government is throwing a wrench in the works: instead of the 85 to 90% of EU goods previously exempt from import duties, a new list recently emerged in which significantly fewer goods are exempt.

Thought of sales tax yet?

Free trade agreement or not: exporters to the UK will have to pay an import VAT. Depending on the Incoterms used, they will have to act as a VAT consignee in the UK and have a UK VAT number.

Physical controls, pre-registration, and customs declarations

Supposing that the UK and the EU reach an extensive trade deal over the next few months, this will not yet include all internal market concepts as we know them within the EU.

Think of the mutual recognitions, the principle of origin, and harmonization. Moreover, a free trade agreement does not mean that there will be no more customs formalities or controls.

Quite the contrary.

The British government recently announced a phased introduction of controls with a six-month transitional period to accommodate customs formalities and debts.

Are you ready for the excisable goods?

Despite a free trade agreement, EU rules on excisable goods will no longer apply in the UK as of January 1, 2021. Payment for excisable goods transported within the EU is deferred until the goods are sold to the end user.

As of next year, these goods, in transport to and from the UK, will become ordinary import and export goods to which an EMCS (Excise Movement Control System) message no longer applies.

British declarants will also no longer be able to register in SEED (System for Exchange of Excise Data) and will no longer be able to create an e-AD (electronic administrative document).

Only Northern Ireland remains: thanks to the Protocol on Ireland and Northern Ireland, freight transport between the EU and Northern Ireland will remain under EU rules until 2025.

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To make sure that all these flows run flawlessly, more than ever the key lies in advanced, but at the same time rock-solid, ICT applications. “If you want to get it right, even in the logistics sector there is no way other than solutions that start from the workflow,” says Patrick Van De Looverbosch, CEO of Antwerp-based specialist Intris.

“Especially because of its small margins, the development and maintenance of software for the logistics sector is far from easy,” explains Patrick Van De Looverbosch.

His company Intris, short for International Transport Information System, has been serving this market for 25 years with digital solutions that improve administration efficiency along the different links of the logistics chain.

Customs agents, shipping and line agents, transporters, large shippers, and especially forwarders call on the Antwerp market leader in its sector.

“With my experience in the transport and customs world, Intris has focused on platform-independent software from the outset. This way, we have avoided having to spend too much time on adjustments when updating those platforms, which has also allowed us to pay more attention to the features of our products. This allowed us to quickly establish ourselves firmly in the market,” says the business manager.

“Our focus on forwarding companies instigated our further development into an integrated logistics service provider. We developed an initial software solution that allowed our customers’ business systems to communicate with their customers’ or third parties’ business systems.”

Since an Enterprise Service Bus (ESB) such as this responds to the processes between packages, it allows for fast switching. “Because it keeps you, as a developer, from having to adapt the underlying packages to the client’s needs over and over again. This innovative step made an initial acceleration happen,” he states.

Workflow Defining

With sophisticated solutions tailored to the workflow, Intris took the next innovative step about ten years ago. “While this approach was already well embedded in the industrial sector for example, it was slower to gain ground in the logistics world. Even if mapping out the business processes also makes it clear to a logistics company which steps it no longer needs to take.

Those are often only taken because people are so used to them that they no longer wonder if there is any other way. Even though the margins in the sector are under considerable pressure. At the same time, customers of logistics players wish to have an up-to-date overview of stocks and want documents and invoices to be processed automatically. It is impossible to achieve this without a clear workflow. That’s why this is the best way of working for us today,” Patrick Van De Looverbosch stresses.

“The concept of a customs package is simple in itself. But the constantly changing context creates a more complex story.”

With customs to him being the beating heart of logistics, it was obvious that Intris was initially going to focus its developments on that. The challenges in this are the changes in regulations and features that frequently need to be integrated into the software package.

“The concept of a customs package is simple in itself: you deliver something, then you receive a document. But the constantly changing context, such as trade restrictions, creates a more complex story. Under no circumstances should our customers bear the brunt of this. If they have a maintenance contract with us, we will keep them up to date without an additional fee.

Incidentally, with Michel Van Giel, we have had a former director of customs in our ranks for several years now. He assists our 45 employees with the conversion of those customs rules into our packages. His expertise also helps us to assess perfectly whether questions from customers fit within the legal framework,” the CEO points out.

Brexit Proof by Australian Alliance

Since the spring of 2018, Intris has formed part of the Australian WiseTech Global Group, which is already number 1 in the same segment in America and Australia. “In terms of philosophy and approach, we were already on the same line, so this alliance was a logical next step.

Looking at the future, the collaboration with a financially powerful group allows us to keep shifting gears and developing at the pace that the market demands,” says Patrick Van De Looverbosch. The international connection also helped Intris to work out solutions for Brexit, whatever the outcome will be.

Reliable across the board

In addition, the obtained certificate of Authorized Economic Operator proves that customs considers Intris to be a reliable partner in cross-border trade. It is a company that, for that matter, has established itself throughout the entire logistics chain, because over the years it has also developed cloud applications for communication with customs services, declaration of hazardous cargo, warehouse management, tax representation, and more.

“With Squid we now offer customers a user-friendly integration and communication platform to quickly connect with both government and private platforms. For example, we have already joined NxtPort and RX/SeaPort for the Antwerp and Zeebrugge ports respectively, and integrations with the Rotterdam Portbase platform are also possible.

We didn’t pick the name Squid by chance; it was chosen because of all of [our] tentacles reaching far and wide,” explains Patrick Van De Looverbosch.

“With a quarter of a century of experience, we can rely on architecture and components to be able to respond proactively to new situations. For example, after installation and configuration, a new customer can quickly plug into any part of the full package he finds appealing.”

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The database used for this is the ERP package from ECS2XL.

As soon as the products leave the warehouse (and are consolidated on the truck), the corresponding data are sent automatically to TRIS Customs.

The system draws up an export declaration in PLDA and sends it to the Belgian customs.

Once confirmation of the MRN numbers is received, the relevant data are sent to RX/Seaport (the data platform for the port of Zeebrugge) for pre-declaration at the ferry e-desk.

At the same time the system prepares the British import declaration.

(You read that correctly: this is all done automatically.)

All these data are sent to CargoWise One (the global solution from WiseTech Global) which further processes the British import declaration and – still automatically – sends it on to the British customs system.

The UK import duties, VAT (sales and purchasing invoices) and MRN numbers are reported back to TRIS Customs.

TRIS Customs then automatically generates an invoice that also includes the administration costs.

As soon as hard Brexit arrives, this system goes live.

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Whether it will be a hard or a soft Brexit, deal or no-deal, the fact is that the UK will no longer be part of the EU as of 30 March 2019. In the best case there will be a transition period lasting until the end of 2020, with a possible one-time extension until the end of 2022.

But although the ultimate deadline may be uncertain, one thing is blindingly obvious: all scenarios will bring customs obligations with them, and trade with the UK will involve formalities that have to be met.

Which measures can you take already now?

1. Make sure you understand your own flow of goods and what your Brexit weaknesses are: longer transit times, the need for additional documentation, import duties …

Assume the worst.

To carry out a Brexit scan see:
– general (Federal Govt. Dept. of the Economy)
– specifically for VAT matters (Customs & Excise)
– Flanders Investment and Trade

2. Brush up your knowledge of Customs & Excise, because if you’ve never traded with a non-EU country you’re in for some unwelcome surprises.

Agree who is responsible for what within your company.

3. Speak to your customers, suppliers, service providers etc.

Review your current and future work procedures, agreements and conditions. Screen the contracts for liabilities, KPIs, Incoterms, capacity, exchange rate conditions etc.

4. Contact customs to request your EORI registration.

You need this Economic Operator Registration and Identification Number to import or export outside the EU (and so also the UK).

5. Get a third party to take care of your customs processing; make sure they have the necessary information to do this correctly.

6. Look at the possibilities for investing in customs technology in order to cope with the increased volume of transactions and clearance costs.

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Is your customs system ready for this?

Of course you can make customs declarations for goods sent to and from the UK, but are you prepared for the additional workload? Wouldn’t it be much simpler for the standardised, repetitive movements to be declared automatically to customs directly?

Do you have any idea how much time (i.e. manpower and costs) you would save by automating these uniform declarations? And how your customs clerks could use that time instead for complex declarations?

TRIS Smart Tower

That’s why Intris has developed a tool for you as part of its Customs solution that saves time, prevents errors and centralises the data in one system.

This TRIS Smart Tower automates all the repetitive, monotonous operations that might appear trifling but are nevertheless critical. Just one small mistake in copying from the customer order to the declaration could easily cost you a couple of lost hours.

Not to mention incorrect VAT and import duties in your invoicing.

Four big advantages

1. With the Workflow Management System the customer can set their own checkpoints so that the system monitors the customer’s procedure, with the necessary alerts.
2. TRIS Smart Tower reads the data from external systems (ERP, Excel, PDF, .xml), makes a declaration in TRIS Customs and sends it to customs. When clearance is received it is processed automatically in TRIS Customs.
3. It then informs one of your clerks, the customer and a third party (e.g. pre-announcement of the container in APCS and Portbase) about the clearance note.
4. Finally it reports the clearance, files the declaration and invoices the customer.

AEO certificate extended to 2021

Intris is one of the few software suppliers that enables customers to communicate directly from their system with the customs in Belgium and the Netherlands. Intris obtained AEO certification for this back in 2014.

Intris and WiseTech

Intris NV is a member of the Australian group WiseTech Global. This stock exchange-listed company focuses mainly on innovation in worldwide supply chains.

It develops and supplies cutting-edge logistics solutions that stand out for their far-reaching integration, detailed compliance capabilities and worldwide reach.

WTG has among its customers more than 7,000 logistics companies spread over more than 130 countries, including 33 of the top 50 worldwide third party logistics service providers and 24 of the 25 largest global forwarders.

As a member of the WiseTech Global worldwide network, Intris offers its customers secure future prospects: the significant innovation capacity that is invested locally ensures that all links in the supply chain (including customs management) can keep up with and even anticipate the rapid changes in society.

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“This is the logical next step for Intris, as we are currently transforming our operations and technologies to better support the market and our customers, with whom we will continue to partner closely. With WiseTech’s global strength and significant innovation capacity invested locally, we will accelerate our drive to improve our customers’ forwarding, warehousing and customs management capability.”

– Patrick Van De Looverbosch, CEO

Click here to see the full media release

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European Customs Decision System (CDS)

A brand-new, pan-European electronic system now permits requests for 22 different types of customs clearance to be submitted by electronic means (see graphic below).

As of 2 October this is obligatory for all economic operators in EU member states. The CDS (Customs Declaration Service) is one of the results of the UCC which came into force on 1 May 2016, aimed at among other things streamlining the customs processes.

This CDS must be used by the economic operators as well as by the customs services, to apply for customs clearance as well as to grant, cancel, suspend, revoke and/or amend it.

How does it work?

An economic operator wishing to submit a customs clearance request has to log in to the EU Trader Portal, the central platform developed for this purpose by DG TAXUD. To gain access to the system the economic operator must first log in to the application run by the particular national customs authority. There they can obtain a user account with which they can log in to the CDS portal.

Requesters must have an EORI number which has to be registered in the country for which clearance is required.

There is an e-learning module that explains the various steps that have to be taken by requesters: https://ec.europa.eu/taxation_customs/eu-training/general-overview/ucc-elearning-programme_en.

Where does it apply?

It is important to specify where clearance is being requested for. Theoretically it is possible for the economic operator to request clearance for all member states, but this inevitably means a long waiting time as permission has to be obtained from all the national customs authorities concerned.

The CDS offers three possibilities:

• validity in all member states
• validity in some member states
• validity in one member state.

Main advantages

1. A single system that applies to all member states
2. Simple management of all customs-related processes
3. Level playing field between all economic operators in de EU, irrespective of the scale of operations.

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Large “public” cloud service providers (think Amazon, Google, Microsoft and Oracle) have launched innovative services in the past few years such as blockchain applications, IoT back-end data services, encryption services, “serverless” computing services and new computing hardware services.

Another IT research bureau, 451 Research, has calculated that 69% of large companies will have a multi-cloud or hybrid IT environment by 2019. Within two years 60% of the workload will run in the cloud, 15% more than at present.

Four types of cloud

If you read the research, articles and opinions it becomes apparent that there are four types of cloud. The most well-known is the public cloud. Think of your Office 365, Google Docs and suchlike, where you don’t have to bother about the management, maintenance or security of the data centre where your data are stored.

The direct opposite of this is the private cloud, where the company has its own cloud facilities. Such a private cloud can run within the company’s own premises or in a secure data centre. In this case the company itself takes care of the hardware investments, maintenance, back-ups, updates and so on.

Then there is the multi-cloud which applies to a large number of companies and also private users. To return to the public cloud suppliers: if you use the Office 365 email application and share your documents via Dropbox, then you are a multi-cloud user since you are utilising both the Microsoft cloud and the Dropbox cloud.

Finally there are hybrid IT applications which are also a reality for most companies, where certain applications run in the cloud and others on the premises.

What’s in a name?

The main thing companies worry about when they hear the term “public cloud” is security, as they associate this concept with a public space where anyone can wander in and out.

Nothing could be further from the truth.

“Our customers who have switched to TRIS-cloud are by definition in a public cloud, since a private cloud is prohibitively expensive for them. But within this public cloud they have their own private cloud which is ring-fenced and secured. For instance, their cloud environment can only be accessed from certain IP addresses that they themselves specify,” explains Intris CTO Tony Vertenten.

IAAS, SAAS or both?

Intris offers its own logistics software in various ways. You can buy everything “on-premises” or opt for a “rental” formula: this is the well-known SaaS concept (software as a service). “This cloud solution saves a whole lot of problems for the customer in terms of maintenance, updates and security,” Vertenten continues. “Furthermore this business model doesn’t take a big bite out of your budget, so the company can accurately calculate its expenditure and use its cashflows for other purposes.”

Then there is the IaaS solution: Infrastructure as a Service. In this case the company opts for the server on which its software runs to also be located in the cloud. “Our cloud solutions cover both ‘services,’ but if the customer also wants to run non-TRIS applications on a virtual server, for instance its own accountancy package, then that’s perfectly feasible,” Tony Vertenten concludes.

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The number of Excel users around the world is estimated at 400 million. As long as it’s for personal use or private accounting for small businesses there’s nothing wrong with this. Indeed Excel is an excellent tool for drawing up and maintaining simple plans and scenarios.

For not for more complex, mission-critical applications such as stock control where data have to be distributed so that the links in the supply chain fit together smoothly with one another.

And yet it is estimated that 50 to 80% of all companies still use such stand-alone spreadsheets to support their business objectives.

This is despite the fact that logistics processes are becoming more and more complex and the warehouse increasingly forms part of a larger, integrated whole. Is a simple spreadsheet still really adequate for this?

More to the point: are warehouse managers using the right tool?

There are four arguments that point to the answer “no.”

1. Manual input and output

Working with spreadsheets means that someone has to enter the data into them, and manual input costs time and money. The bigger the company gets, the more people must be assigned to this task. And anyway this is repetitive work that cries out for automation.

On the output side the spreadsheet has to be regularly forwarded to all those who need the information: yet another manual operation. If it’s not done quickly enough then customers start phoning up to ask whether their order is on its way, and another member of personnel has to check the spreadsheet.

WMS applications can have automated input systems (fed e.g. by scanners or RFID) and can give customers access to certain information via a web portal, thus making “manpower” unnecessary. Personnel can then be used for tasks that really need to be done instead of these repetitive operations.

2. Input errors

Correct operation of a spreadsheet depends entirely of the reliability of the input. If this is done manually then human error is inevitable. Faulty spelling of names or addresses, forgetting to fill in a particular field, incorrect stock data or failure to update … spreadsheets don’t have built-in alarm systems to prevent such errors.

Did you know that at the 2012 Olympic Games in London places at four synchronous swimming events were overbooked due to human error? Somebody had entered the number of spectator places available as 20,000 instead of 10,000. It took a great deal of time and effort to contact the unfortunate ticket holders and offer them an alternative …

WMS applications have built-in business logic and workflow systems that avoid such errors. Fields have to be filled in, serial numbers are automatically checked, stock is automatically updated after each operation, and so on.

3. No real-time overview

Filling in Excel lists is not the most interesting job in the world and so the work is often put off, which means the data are not always up to date. As a result, decisions are taken based on information that is no longer accurate. The warehouse manager is not the only victim: so are the customers to whom this “obsolete” information is forwarded.

WMS solutions by contrast update themselves automatically and customers are always given the most recent information: either they get it automatically in their mailbox at set times, or they can consult it via a web portal, or a combination of both.

4. “Integration” is not in the spreadsheet dictionary

Spreadsheets are not designed for sharing with other departments or applications. If you want to share information, then you have to copy/paste. The scope for human error is huge: copying incomplete rows, deleting cells by mistake, breaking links and formulas …

WMS solutions on the other hand can be integrated with the customer’s ERP system, so there is no need for additional operations when an order is placed. That alone makes a big difference.

But where spreadsheets really miss out is integration with specific WMS hardware such as scanners. When the warehouse operative scans a particular item the WMS system knows immediately and updates the information in real time.

There’s no way a spreadsheet can compete with this integration.

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The EU is determined to promote this trade and is working hard to remove the obstacles in its way, by among other things streamlining the European Customs and VAT legislation.

But already there are plenty of opportunities for logistics service providers to benefit from the e-commerce trend.

The current Customs risks for e-commerce

Many items sold on the internet don’t have to be declared, because of their low value. This means they also escape various other restrictions, such as those on:

• Counterfeiting
• Compliance with EU health & safety requirements
• Protected plant and animal species
• Components that could be used for terrorist attacks
• Weapons, drugs etc.

Strategic advantages of bonded warehouses

Bonded warehouses fall under the supervision of the Customs authorities and so are subject to inspection. A side effect of this is that it eliminates the HSEE (Health, Safety, Environmental and Economic) risk.

But a bonded warehouse also offers various other possibilities for logistics service providers to create added value for e-commerce. These include:

• Creating a strategic stock without the merchandise having to be put on the market and/or re-exported to a non-EU country
• Simplified stock-in and stock-out procedures
• Re-sale of returns (goods that have been refused or that could not be delivered), with the Customs declaration being cancelled after the initial sale (the goods go back into bond after a period of 90 days)
• Using the warehouse as a showroom

Customs and technical advantages

Customs advantages:

• No complex return procedures or loss of import duties and VAT on returned goods
• Simplified procedures: bonding and aggregated declarations
• HSEE checks when goods enter the warehouse

Commercial advantages:

• Faster delivery
• No returns to shippers in non-EU countries
• Re-sale of returns

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