BREXIT Contingency Plan – PSG
Dear valued customer,
The official Brexit date is 29th March 2019, and on that date the final arrangements between the UK and EU will be known and agreed (unless delayed). In the case a withdrawal agreement is ratified, a “transition period” will begin. This period will exist until 31st December 2020. During such transition period the UK and EU will continue to operate under the same conditions as those in existence prior to the Brexit date. In the transition period, PSG will take action on all the below points to ensure continuity of supply and to minimise any impact to our, and our customers’ businesses. If a withdrawal agreement is not ratified then a transition period will not apply and the full Brexit situation will apply as from the Brexit date. This situation will be less favourable, but we will adapt to it by implementing our final operational model with immediate effect.
PSG produces, imports and exports its products throughout the UK, EU and the rest of the World. We consider all the products that we supply to be within the scope of the effect of the trading relationship between the EU and UK. PSG are a registered UK Economic Operator, has an EORI number and already exports its products to countries around the world which are not part of the EU. We have a strong capability and experience in the preparation of relevant customs documents and hazardous goods export paperwork (including country of origin information, tariff codes, incoterms etc.). We can confirm we have the necessary controls in place to ensure the correct commodity codes exist for all products & are printed out on export paperwork. Therefore, in case trade between the UK and EU is subject to such controls, PSG is already capable of managing these additional processes. We are in the process of evaluating all the products that we supply to clarify the country of origin including any UK and EU content.
The impact of tariffs & duties is unknown, but in any event, we are modelling the financial impact on the business of different scenarios and working with an external agency to ensure we understand the Rules of Origin of the products we supply.
We would have to increase our capacity and we can do this in the short term by adding an extra daily work shift. We are also consulting with our key freight suppliers who have expertise in these areas and building their best practice into our own processes. We can also confirm that all carriers used by PSG are already Authorised Economic Operators, and have confirmed that they are ensuring that they have the resources available to manage the additional import & export declarations on our behalf.
PSG has a significant stockholding in the UK and we are confident that it is sufficient to secure against any delays resulting from increased customs surveillance of imports into the UK (in excess of the one-month buffer stock as suggested by Airbus). However, we will re-evaluate the lead times for products imported into the UK in our MRP system and ensure they are sufficient to eliminate any delays for our customers. We can also confirm that PSG has sufficient cash resources to increase inventory levels, at short notice, should this be required as well as absorb the additional cashflow requirements of import VAT & duty on EU deliveries, albeit PSG have a duty deferment account in place already which will offset some of this impact.
PSG supports the UK government’s position that the UK will remain a member of ECHA and will continue to follow the requirements of REACH and other similar regulations. PSG are a member of the British Coatings Federation (BCF), which is the sole UK Trade Association representing the interests of the decorative, industrial and powder coatings, printing inks and wallcovering manufacturers. The BCF have issued guidance notes on how best to manage the potential impacts, which PSG are following.
We are aware that it is not clear yet whether the UK will remain a member of EASA after Brexit. This could affect the validity of certification of certain products and services. For PSG this is out of scope. We do not supply goods with EASA form 1 or similar certification. We use internationally recognised Certificates of Conformity issued under our AS EN 9100 Rev D approval and we retain copies of manufacturer’s original CoC and CoA. These are applicable in the EU, the UK and throughout the rest of the World.
As an international and diverse company, PSG values the contribution of all its team members irrespective of their nationality. We will remain well informed about the status of international workers and invest as necessary to ensure that we can continue to allow staff to work at any of our locations. We will support freedom of movement and employment for our team and take all measures to minimise any impact of controls and are in the process of ensuring all current employees who are not British nationals have applied for UK settled status.
We do hope that the above information provides the clarity requested and naturally should you require further clarification then please do not hesitate to contact us anytime, we are standing by to assist.