I wasn’t taken by surprise, exactly. I run a small perfume business, and in mid-December we stopped sending deliveries to European Union countries because we wanted to ensure nothing was caught in the rush to beat any new trading rules. In some ways, I had been preparing for such issues ever since the Brexit referendum was called several years ago. I always feared there would be difficulties for small businesses.
A little more than a month into the new regime, and it’s clear that with every new hurdle, there are extra fees to pay. Whether it’s importing raw materials or sending our products around the EU, additional forms need filling in and costs are nudged up. Our perfumery is dealing with new customs rules and new VAT regulations, and losing access to the EU cosmetics market. At midnight on 31 December, all our perfume products automatically became illegal in the EU.
I could make them legal again. To do that, I would need a representative based in the EU – a legally appointed responsible person (RP) – but to set this up, companies offering the service are quoting up to £1,000 a year per product, and we’ve got 60 different items to sell. That’s an additional £60,000 of annual expenditure we don’t have. We’ll find a way to make it all work eventually, but until we understand the VAT issues, there’s no point.
One of my friends in the industry thought he understood the new system: last year he confidently said it would only require one extra piece of paper and that there was no need to worry. In January, though, one of his EU-based customers was charged an additional fee of £130 by a delivery company. He still doesn’t know why. For many of us in the independent cosmetics sector – a world away from the multinational brands – we have to pause our sales to customers in the EU until we can figure out these problems. The losses for our businesses are mounting.
Another friend has a wholesale order destined for Germany, but it’s stuck in customs somewhere. A second order set off for Spain, but only got as far as Middlesbrough because the shop owner there now has to be a registered importer. It will take about three months to be registered on the Spanish system because of the sudden post-Brexit rush – combined with a Covid-19 backlog.
Until Brexit was finalised, cosmetics companies all followed EU regulations designed to make sure every product used on people’s skin and hair was safe. When things changed, some of our British customers were delighted for us, imagining that we would be free from EU constraints, and suddenly permitted to use lavish amounts of previously restricted materials such as jasmine, rose and carnation. But what really happened was that in 2019 the government copied and pasted the EU regulations straight into UK law. I watched official announcements about how we would all be free from EU bureaucracy , knowing that it wasn’t quite true. We have shiny new UK regulations that are exactly the…
Go to the news source: I thought Brexit would be hard for small businesses like mine – but not this har…