On Wednesday 24th January, the All-Party Parliamentary Group for Textiles and Fashion has joined nine other APPGs on the need to secure mobility of creative talent post-Brexit. Of the creative sector’s £91.8bn worth Textiles and Fashion contributes over £28bn to the UK economy and employs almost 1m nationwide. It is also a huge BAME employer, however many of the workforce within the Textiles and Fashion sector are freelance, or work within SME companies, meaning until now, it has been harder to hear their concerns versus those of sectors where the large proportion work within big organisations. Across the textiles and fashion industry, Freedom of Movement is crucial. From trade and fashion shows, in Berlin, Copenhagen, Paris, and Florence this month alone, the sector is geographically fluid and economically mobile. Without Government awareness and support, there are real concerns that those many talented creatives within fashion, who make this country a great place to start their business, or for global businesses to first establish their European market presence as a launch pad into the EU, will relocate. It is worth noting that global fashion tech leaders, such as Net-A-Porter, Farfetch, and Business of Fashion are all headquartered here, as well as the European base of Amazon. The Textiles and Fashion APPG also emphasises the need for uninhibited movement of trade.
Our secretariat, Fashion Roundtable’s EU policy expert, Eszter Kantor, raises the following issues to be aware of:
1) Without an agreement allowing UK businesses access to the European market on 1 April 2019, as the UK will leave the EU single market, commercial transactions with European businesses will become exports and imports where customs formalities and tariff rates will play an important part. Therefore, businesses must familiarise themselves with the EU combined nomenclature to stay competitive and not fall out of the market. 2) Recommendations that all fashion businesses attain Authorised Economic Operator (AEO) status (both for UK companies exporting to the EU as well their EU counterparts wishing to export into the UK). This status provides access to custom simplification procedures and ensures fewer customs control (opening of containers) which can make the transit procedure faster.
3) The EU operates a number of useful online tools, which should be adopted and copied by the UK authorities to facilitate the ease of commerce between the UK and EU: the first one is the binding tariff information (BTI). If exporters would like to have legal certainty that they are applying the correct product classification (and tariff rate) to their goods they can either ask through the BTI website customs authorities to confirm the right product category and tariff rate or search the BTI database for a previous decision on goods similar to theirs. A BTI decision is, as its name suggests, binding for both the exporter and the authorities for a period of three years. That means that once customs authorities grant a product classification number, exporters must use that. 4) Another useful tool is TARIC, the integrated Tariff of the European Union, which is a multilingual database containing all measures relating to EU customs tariff, commercial and agricultural legislation. It includes the codes of the products, their tariffs, any other levy attached, restrictions etc. It gives all economic operators a clear view of all measures to be undertaken when importing into the EU or exporting goods from the EU. Other concerns include A) That it is essential that companies know their own supply chain so that they can see what percentage of their raw materials or product parts come from the EU (these will be imports from 2019 April) or are sold to the EU. This will help identify the foreseeable amount of cost increase and give businesses time to formulate an appropriate strategy. B) The potential influx of counterfeit goods into the market. When customs services are under pressure the problem of counterfeit goods is almost always highlighted. With the sudden increase of importers, a higher number of counterfeit goods may slip through customs control. Industry needs to work together with authorities in the UK, in Ireland as well as in the EU to make sure these criminal networks cannot infiltrate the market. With an open border in Northern Ireland and an overwhelmed UK customs, the transportation of illicit items can become easier. Creative industries need to work together to spot and report counterfeit goods on the market. Questions also arise regarding the future position of the UK Government on Chinese imports and whether or not the UK will adopt the EU`s new anti-dumping legislation or provide a more open access to Chinese imports. C) Duty drawback (refunding duties paid on imported goods) is more likely to happen in developing countries. There is no preferential agreement with the US currently; with developing countries, however, there are a number of agreements supporting trade. If you are importing from a developing country with a preferential duty scheme you will need to attach a proof of origin paper to your consignment. In the UK it will be the job of the Department for International Trade to set up or make the necessary changes to the customs system and trade policy, which may include a wider duty drawback policy. In the EU there are limited occasions when you can use duty relief (personal travel, inheritance, relocation, R&D etc.) and there is the ATA Carnet which can be used for temporary importation meaning products will leave the customs territory of the EU within 12 months of entry in the same condition. D) And lastly, the possible introduction of visa requirements for EU workers in the UK and vice versa will increase costs and administrative burden on the sector. Creative industries rely on the free movement of people and will need a visa-free access or visa simplification procedure for their professionals.
This is why Fashion Roundtable have signed up to the #FreeMoveCreate campaign and we urge all here to do so as well at