Surge in UK AEO Applications -UK exporters preparing for life after Brexit

11-Jan-2019

There has been a surge in AEO applications in the UK - a clear indication that the country's exporting businesses are preparing for life after Brexit. A 26% rise in registrations up to January 2019 compared to February 2017 represents the highest percentage increase in registrations across Europe (see below table).

The UK has long lagged behind counterpart European nations in terms of its number of AEO applications. Up to January 2019, 679 UK businesses have registered, compared to 6330 in Germany, 1556 in the Netherlands, and 1664 in France.

Authorised economic operator (AEO) status demonstrates a company's role within international supply chains as being secure, indicating that its customs controls and procedures are efficient and compliant.

However, the 26% increase over the last two years signals a gear-change, according to director general of the Institute of Export & International Trade, Lesley Batchelor.

"UK businesses are now realising that they will need to prove their competency in customs procedures when Brexit comes around - whatever form it may take. This surge in applications is encouraging, but there's much more to be done before we catch up with our European counterparts, who will soon be our competitors.

"Attaining AEO status will be a useful exercise for exporters, whatever our future arrangement with the EU will be. The application process allows businesses to fully examine and ensure that its customs regime is up-to-scratch. Doing this will also put businesses in a strong position for other customs arrangements, including the trusted trader scheme.

Holly Tonge, director of special projects at the Institute, also said:

"Many of the companies I've worked with in recent times have applied for AEO to safeguard their attractiveness in the supply chain post-Brexit. I would suggest that more companies should look at AEO as a way of ensuring they are operating as efficiently as possible, as post-Brexit the need for customs competency will be greater than ever."

Country

Registrations Feb 2017

Registrations Jan 2019

Variance

UK

537

679

26% increase

Germany

6031

6330

5% increase

Netherlands

1514

1556

3% increase

France

1438

1664

16% increase

 

AEO - a solution for supply chain competitiveness post-Brexit?

Internationally recognised as a mark of quality, AEO status effectively demonstrates a company's role within the international supply chain as secure, indicating that its customs controls and procedures are efficient and compliant.

Whilst not mandatory, the EU has nonetheless been actively encouraging the majority of organisations who export outside of the EU to sign up to this worldwide initiative, which has been designed to ensure that international supply chains are secure and controlled from the point of origin through to the final delivery destination.

Within the single market and the customs union, as the UK is at present, companies holding authorised economic operator (AEO) certification have already had a clear advantage when exporting, especially to the United States and the world's largest economies, through mutual recognition agreements.

Post-Brexit, AEO certification may well become even more desirable as an internationally recognised tool to keep cargo moving. The EU and UK are expected to recognise each other's AEO schemes in a post-Brexit environment.