What does the deal between the UK and the EU mean for my company?

Since the UK’s exit from the EU we are now in a transition period where the trade terms will remain the same as they were when the country was still a member of the bloc. This period is initially set to end on the 31st of December 2020 with a one year extension possible.

However, the deal that both sides approved prior to the UK leaving the EU is the withdrawal agreement, setting the terms for the UK’s exit from the bloc. It is only now that the future trade relationship between the EU and the UK is being negotiated. Thus we still won’t know how trade with the UK will look on the 1st of January 2021.

Moreover, free trade agreements (FTA) take a long time to negotiate, with the recent FTA-negotiations between EU and non EU-states taking between six and eight years, with some still awaiting ratification. Hence, the default scenario remains a no deal Brexit at the end of a transition period.

Can we send staff to work temporarily in the UK over the Brexit deadline? Will they require specific work permits?

EU citizens can still enter the UK despite the country having left the bloc and can still move to, live, work and study in the UK until December 31st 2020 as they did before the 31st of January. You can read more about traveling and working in the UK after Brexit on the UK authorities' website here. There is also a guide that can be used to see if you need a work visa.

If we send staff to work temporarily in the UK over the Brexit deadline, will they be allowed to bring their own tools?

If your employees are to bring tools for their work, they should consider whether they can use an ATA carnet, so that they can take the tools in duty-free and avoid import declaration. Your nearest Chamber of Commerce can support you in issuing an ATA Carnet.

What obstacles to trade of services can arise following a no-deal Brexit?

Right now the outcome of Brexit remains unclear, hence so does the future form of trade of services.

In the case of a no-deal Brexit, how the UK chooses to treat international service providers will be governed by the UK's WTO commitments (GATS). However, there may be that more areas relating to sales of services are open to foreign companies than those strictly committed to under WTO terms. Companies needs to investigate what applies for their specific industries.

Assuming a company sends staff to the UK, a no-deal Brexit can risk posing requirements on visas, work permits and other similar administrative requirements which risk being costly and time-consuming. The UK authorities have issued some advice relating to visiting the UK that you can find here.

The Swedish National Board of Trade Sweden (Kommerskollegium) is the point of contact for companies trading in services and should be able to answer specific enquiries. You can find more information here. 

What effects can a no-deal Brexit have on taxation related to sales of services?

How you deal with taxes, for instance VAT, in a no-deal Brexit scenario depends on whether you sell your service to a company or to an individual.

If you sell to a company, the main rule when selling to countries outside of the EU, is that companies should collect VAT in the country where the buyer is established. See more information on the Swedish Tax Agency's website here.

If you sell to an individual, the main rule when selling to countries outside of the EU, is that companies should collect VAT in the country where you, the seller, is active. See more information on the Swedish Tax Agency's website here.

We recommend companies to contact the Swedish Tax Agency and its counterpart in the UK regarding specific questions. The Swedish Tax Agency has set up a website with information relating to VAT and Brexit here.

What effects might new tariffs and customs procedures have on our business?

The limitations to free trade in goods and services, which will come into place in the case of a no-deal Brexit, risk impacting companies in several ways. For instance, companies risk facing longer lead times due to bottlenecks in UK ports leading to increased administration costs linked to new tariffs and decreased client satisfaction due to for instance long lead times on online purchases. Further, new tariffs may affect exports & imports may further increase competition from firms with storage (or even manufacturing) in the UK as these will not be subject to same lead times (nor tariffs).

Will there be any new rules we need to abide by?

New rules linked to new tariffs and customs procedures risks increasing the administrative burden for many companies, especially those not used to trading with countries outside of the EU (please see below for more information "We have very limited experience of handling customs procedures. Can we hire someone to do it for us?").

In the longer term, limitations following the UK's new regulatory independence may pose problems for companies. For instance, we risk seeing changes in jurisdiction on intellectual property, GDPR, competition law, disputes and arbitration as well as potential non-tariff barriers due to diverging regulation and requirements of multiple different standards (CE-mark, etc.)

Further, just as required when trading with any other country outside of the EU, a no-deal Brexit will require Swedish companies to have EORI-numbers in order to export goods to the UK. This can be applied for at the Swedish customs.

Finally, as a company you should make sure you still meet the requirements of other free trade agreements. Leaving the EU implies that all goods from the UK, previously having preferential origin in the EU, will lose that status. Hence, your product will also lose its preferential status if it is dependent upon goods from the UK having EU origin status in order to fulfil the rules of origin. This can be applicable in trade with other countries to which you might sell today.


We only sell online, will Brexit impact us?

The rules outlined above apply to online sales as well.

For online sales, there are also other trends to consider. For instance, 17% of UK consumers see same day delivery as the most important consideration and 14% see fast delivery as the most important (ranking second and third in total). Similarly, slower than expected delivery is perceived as the most common problem among consumers, experienced by 29% of adults who bought online in 2016. Potentially longer lead times due to customs clearance could impact companies exporting from Sweden to the UK.

For more information on e-commerce in the UK, please see our e-commerce guide here.

Will we still be able to sell our services to the UK after Brexit?

Unlike for goods where the EU applies uniform external tariffs, the EU countries do not have a uniform trade policy for services. Further, in the case of a no-deal Brexit, free movement of labour will end. How movement of labour will look in the future is yet to be determined. Hence, though trade of services will be affected, it remains unclear as to how.

Are there any VAT considerations we need to make?

In the case of a no-deal Brexit, the UK would leave the EU VAT area and become a 'third country' in the eyes of the EU, and vice versa. The UK government’s aim in the case of a no deal is to keep VAT procedures as close as possible to what they are now. UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return.

Companies can set up a duty deferment account with HMRC, allowing import VAT and customs duty to be paid monthly in arrears, usually subject to a bank or insurance backed guarantee. Whilst this will involve additional administration and cost, it could shorten the time-gap between paying import VAT and reclaiming it as input tax, hence impacting cash-flow.

Are there any custom duties considerations we need to take

Importers will become subject to additional administrative requirements, customs duty, including obtaining import registrations and submitting customs declarations every time goods come in and out of the EU, to and from the UK.

As a company, you should analyse it you can use transitional simplified procedures (see below), if you need a licence to import or export your goods, and if, when importing, you need to make a safety and security declaration before the goods arrive in the UK. Finally, companies should check their internal capabilities against new requirement to evaluate the need for additional resources or support.

We have very limited experience of handling customs procedures. Can we hire someone to do it for us?

If you do not wish to handle new customs procedures that may result from Brexit yourself you can arrange with your freight forwarder, transport company or with a specific customs broker about submitting the declarations on your behalf to avoid extra administration.

Business Sweden can help in identifying suitable partners. Please contact us for more information.

How will Brexit impact our relationship with our distributors?

How Brexit will impact your relationship with your distributor is difficult to say. Apart from needing to decide on who will act as an importer of goods as well as decide on trade terms, we suggest you speak directly to them.

If you wish to act as an importer on behalf of your distributors, you need to apply for a UK EORI-number (done through the HMRC). Further, your company needs to be VAT-registered with the HMRC to be able to deduct VAT. You can both apply for a UK EORI-number as well as become VAT-registered as a Swedish registered company, hence you do not need to set up a UK branch or company for this purpose.

What is Transitional Simplified Procedures and should we get it?

If you want to act as your own importer, you should consider applying for the Transitional Simplified Procedures (TSP) offered by the British customs agency.

Companies can use a TSP after the UK leaves the EU. This applies to “roll on roll off locations”. According to the HMRC, the routine will be active “probably at least a year”.

The TSP allows the importer to reduce the information needed in the import declaration at the border crossing by allowing the importer to defer submitting  of a full import declaration and paying import duty

To apply for the TSP you will need a UK VAT number, a UK EORI number as well as a branch of a subsidiary in the UK

Business Sweden can help in setting up a company. Please contact us for more information.

Will our EU employees be allowed to stay in the UK?

EU citizens who are residing in the UK before the 31st of December 2020 will be allowed to stay in the country provided that they apply for the new permanent residence permit, so-called settled or pre-settled status until 30th of June 2021.

Will we be able to travel freely for work to the UK after the Brexit date?

The UK Government has announced that it does not intend to require EU citizens coming to the UK for short stays (less than 3 months) to apply for any visa.

If you intend to travel between Sweden and the UK we encourage you to contact your flight / travel company before your trip and follow the travel information of the Swedish embassy (link here).

If there is no deal and you intend to stay longer than 3 months, please see the UK government's guidance "Staying in the UK for longer than 3 months if there's no Brexit deal". Link here.

Will we be able to send new people to the UK after the Brexit date?

The UK government's future skills-based immigration system white paper sets out the government's plans to introduce a new single immigration system, ending free movement.

The new system includes:

  • A skilled workers route open to all nationalities
  • Lowering of the skills threshold on the skilled workers route to include medium-skilled workers
  • No cap on numbers on the skilled workers route, meaning that business will be able to hire any suitable qualified migrant
  • The abolition of the resident labour market test
  • A new time limited route for temporary short-term workers of all skill levels, including seasonal low-skilled workers
  • An extension to the post-study period for international students

You can find the white paper here. 


Are there any other aspects that risk impacting us?

For additional questions to ask yourself, please download our white paper:
BREXIT – Assess your areas of vulnerability - Questions your company needs to ask itself. 

Where can I find more information?

For more information, please have a look at the other material on our website here.

Other useful sources are

  • The Swedish embassy's FAQ here
  • The European Commisions Factsheets and Questions and Answers here
  • The Swedish government's Brexit preparedness website - Brexit – the United Kingdom’s withdrawal from the European Union here
  • The national Board of Trade Sweden's Brexit site here (please note in Swedish)

If you have any additional questions, please don't hesitate to contact us.

Did you not find the answer to your question? Contact us.

Johan Ottosson - Brexit

Project Manager,
+44 7572 60 98 81


Market Area Director,
UK & Ireland
+44 20 7258 5134

Business Sweden’s purpose is to help Swedish companies grow global sales and international companies invest and expand in Sweden.

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