TCA will directly affect all companies exporting and importing goods across the UK and EU border. While EU and UK companies will see more burdens and constraints than they have been used to, TCA contributes to some degree to preserving the flow of trade in goods. The bottom line is that trade between the UK and the European Union will be duty free and quota free provided the goods are from the UK or the European Union.

The key elements of the contract are:

1. Tariffs 

• Goods “originating” from the EU-UK Free Trade Area will not be subject to import duties or other duties or quotas.

• Goods that do not comply with the applicable preferential origin rules will be subject to the World Trade Organization (WTO) normal import duties (ie the EU Common Customs Tariff or UK Global Tariff).

• Movements of goods (of any origin) solely for the purpose of repair will not be subject to customs duties.

2. Rules of Origin

• To benefit from the no-tariff provision, the product must be from the UK or the European Union. This means that EU materials used in UK production and UK materials used in EU production will help meet the TCA preferential origin rules..

• TCA provides a number of ways in which a product’s origin can be traced, revolving around where a certain proportion of a product’s components are made and where it is assembled. Goods wholly obtained in the European Union and / or Great Britain will be traded duty free. Goods produced using components sourced from outside the EU and / or UK will have to meet product-specific origin requirements, which are assigned by the tariff code in the TCA.

• Some products, such as electric cars, will benefit from a transitional period during which the rules of origin apply.

• Proof of origin can be provided in the form of your own origin declarations, so there is no need to obtain certificates of origin from customs.

3. Customs formalities

• While in most cases no import tariffs will apply, customs formalities will apply and declarations will be required on import and export.

• The TCA provides for the mutual recognition of the status of Authorized Economic Operator (AEO), which means that some simplified procedures will be available for AEO.

• Firms may use a third party such as freight forwarders or customs brokers to act as their agents. 

• The TCA concludes a protocol on cooperation between the UK and the EU to fight VAT, customs and excise fraud.

4. Regulation of product standards

• There is no mutual recognition of compliance standards. This means that, with a few exceptions, the products will have to go through two separate conformity assessment processes to be placed on the EU and UK markets.

• However, the TCA will allow the self-declaration of compliance with EU product legislation for low risk products.

5. Providing Services

• TCA largely replicates WTO rules, and the provisions on services are similar to those we have seen in other recent EU FTAs and do not meet the freedoms of movement, establishment and provision of services that UK businesses have previously enjoyed in the European Union.

• The TCA agreement sets out rules to facilitate the cross-border provision of services in certain areas. Such as, for example, digital services and public procurement. UK service providers operating in the European Union will have to verify that their service falls under one of the exceptions.

6. Digital Trade

• The TCA agreement contains provisions to facilitate cross-border digital commerce, for example a ban on data localization. The UK and the European Union agree not to discriminate against electronic signatures or electronic documents on the grounds that they are in digital form. The UK and the European Union will work together in the future on digital trade issues, including new technologies.

• The United Kingdom considers the EU data protection standards to be equivalent for the transfer of data from the United Kingdom to the European Union. On the other hand, the European Union has not yet issued a decision stating the adequate level of data protection with regard to the transfer of data from the European Union to the United Kingdom. To allow time for an adequacy decision, the United Kingdom and the European Union have agreed separately a further postponement period of up to six months to allow the UK adequacy decision to be completed.

7. People movement

• Visa-free entry from the UK to the European Union (and vice versa) for tourism and work purposes is to be allowed up to 90 days in a 180-day period, although there are restrictions in this regard (e.g. people planning any work other than routine business meetings and conferences need an appropriate visas).

• UK and EU citizens who established EU free movement rights before December 31, 2020 retain them under the UK-EU Withdrawal Agreement in November 2019, if they registered their status under the programs established by the US The Kingdom or the European Union until 30 June 2021.

8. Mutual recognition of qualifications

• There is no mutual recognition of professional qualifications.

• TCA provides for the possibility of such recognition in the future for individual professions through the Partnership Council, but cannot guarantee that such agreements will be concluded. Accordingly, professionals will have to meet the requirements of each EU Member State in which they wish to provide services separately.

9. Northern Ireland

• Although the TCA is an agreement between the UK and the European Union, the TCA provisions relating to trade in goods do not cover trade between the European Union and Northern Ireland which is governed by the Northern Ireland Protocol to the Withdrawal Agreement.

• The Protocol on Northern Ireland effectively creates a customs and regulatory border between Great Britain and Northern Ireland.

• TCA will not regulate trade in goods between the European Union and Northern Ireland and goods imported into Northern Ireland from the UK will be counted as imports.