Saturday, 31 March 2018

PRACTICAL BREXIT ISSUES

The EU continues to issue notices to stakeholders. This one HERE is on products placed on to the single market after Brexit. Note in the first paragraph it mentions the "importers" which are a requirement for any company in the EU which imports products from third countries. Up to now UK manufacturers can sell into any member state and some used a distributor. After we leave we will become a third country. The difference between a distributor and an importer is set out in the so called blue guide (HERE). There are important differences. 


The Notice says:

As a consequence, [of Brexit] an economic operator established in the EU-27 who, prior to the withdrawal date, was considered as an EU distributor will become an importer for the purposes of Union product legislation in relation to products from a third country that this economic operator places on the EU-27 market as from the withdrawal date.

A distributor's role in the EU is as follows:

Conformity assessment, drawing up and keeping the EU declaration of conformity and the technical documentation remain the responsibility of the manufacturer and/or importer in the case of products from third countries. It is not part of the distributor's obligations to check whether a product already placed on the market is still in conformity with the legal obligations that are currently applicable in case these have changed.

However, an importer has to take far more responsibility: 

The importer is the economic operator established in the Union who places a product from a third country on the Union market. He has important and clearly defined responsibilities under Union harmonisation legislation (121) (122). To a large extent they build on the type of responsibilities which a manufacturer based in the EU is subjected to. The importer must ensure that the manufacturer has correctly fulfilled his obligations. The importer is not a simple re-seller of products, but has a key role to play in guaranteeing the compliance of imported products.

As far as liabilities are concerned:

Liability, the responsibility to pay for damages, is placed on the producer. A producer is either a manufacturer of a finished product or a component part of a finished product, producer of any raw material, or any person who presents himself as a manufacturer (for example by affixing a trademark). Importers placing products on the Union market from third countries are all considered to be producers under the Directive on product liability.

How many EU distributors of UK products in the EU will want to become importers? And will those that do accept the increased responsibilities for the same commission or payment? This will impact supply chains to a greater or lesser extent and add friction and costs for our exporters making trade more difficult, costly and less likely.