There are two thoughts that come to mind when reviewing e-commerce in light of the EU parting company with the UK.
Firstly, the issues that have been brought about with regard to duty and cross border transactions.
Our clients have serious headaches whether they are located in the UK or within the European Union. This is because of the nature of the origin of the products that they are shipping in. So, it’s fine to ship something in from the UK to the EU if the goods have not originated anywhere else BUT if they have come from Asia or the USA for example this then starts to include a complex web of duty that the company itself has to resolve administratively and financially.
Set up a company either in the UK or in Europe
One of the ways to smooth things slightly is to set up a company either in the UK or in Europe to ensure that one has a foot on both sides of the continent and goods are coming in from the other under the free trade terms of the Brexit agreement.
Setting up in the UK is fairly easy and can be done within 48 hours.
Secondly, Banking is an issue currently due to Brexit and Covid but online payment solutions are a good way to get invoices and suppliers paid without resorting to a high street bank. This does not come without its issues though.
Amazon has moved to limit sellers using payment service providers (PSP) that offer a currency account solution such as WorldFirst to use a service that is a member of Amazon’s PSP Program. More on this and key dates can be found on this link: https://sellercentral.amazon.com/forums/t/new-payment-service-provider-policy/781063
Key points here are:
- Beginning on March 1, 2021, sellers adding a new bank account from a PSP must use a PSP that is participating in the Program.
- Sellers using a PSP not enrolled in the program have until May 31, 2021, to become compliant.
- After July 5th Amazon will not pay to a bank account offered by a PSP, not on their program.
WorldFirst were one of the first four to be accepted into the program. Amazon will have much stricter payout terms in the future and it is important that any Amazon seller is using a PSP program member to avoid delayed payouts and eventually declined payouts to non PSP program bank accounts.
Once the company has its own footprint in either UK or Europe then it will be a little more smooth to work with suppliers outside of the UK and the EU. Please remember though that you now have another footprint in another country and this means that there will still be some compliance to fulfil in terms of financial reporting to that country.
Contact us for help and advise
Please don’t hesitate to call us on +44 (0) 20 8421 7470 or contact us via the website for help and advice about the quickest way to establish a company or a branch in UK or Europe after Brexit.
