How can companies prepare for the end of the transition period?
During the transition period, the UK will continue to participate in the EU single market and in the Customs Union as if it were a Member State. During the transition period, the EU and the UK will negotiate an agreement on their future relationship, which will determine, for instance, the terms and conditions for trade and investments once the transition period has ended.
Even if the EU and the UK succeed in reaching an ambitious agreement on their future relationship, the end of the transition period and the UK’s withdrawal from the single market and the Customs Union will inevitably mean significant changes for companies and the authorities compared to the current situation.
It is also possible that the EU and the UK will not have time to reach an agreement on trade and investment issues. It is therefore necessary to prepare for a scenario in which trade will take place under the terms of international agreements, including those of the WTO.
The end of the transition period will affect, among others, companies that:
- are engaged in import, export or investment activities with the UK, or
- use content that originates from the UK in their production, such as raw materials or services, including cloud computing.
How these changes will affect an individual company depends on factors such as the company’s field of activity, location and position in the production chain. Below are some examples of changes that may result from the end of the transition period. Further information will be provided later as the negotiations proceed.
The Commission has issued a variety of sector-specific notices concerning the future changes
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One objective of the negotiations on the future relationship is to agree on terms of entry into the EU and the UK for the purpose of business activities, for example for transfers within a corporation, short-term business visits or project-based work. The negotiations are currently under way. Further information on the content of the future agreement will be provided at a later stage of the negotiations as the negotiations proceed.
If an agreement on the future relationship is not reached, the Finnish Aliens Act will apply to business-related entry into Finland after the transition period.
For more information, visit https://migri.fi/en/home
Entry into the UK and residence in the UK will be governed by the UK Aliens Act. For more information, visit www.gov.uk/transition
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European Commission: ‘Brexit preparedness checklist’ for companies doing business in the EU (drawn up in 2019 in preparation for the UK's withdrawal from the EU without an agreement, but the list is still useful for the current situation. However, the references to the withdrawal date are now outdated).
Sector-specific notices from the European Commission on the effects of the UK’s withdrawal from the EU. -
In the negotiations on their future relationship, the EU and the UK aim to agree on certain issues concerning taxation. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.
If no agreement is reached on the future relationship, the end of the transition period may mean changes in taxation, for example with regard to value added tax or excise duty.
More information on taxation in Finland
More information on taxation in the UK
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In the negotiations on their future relationship, the EU and the UK aim to agree on issues related to goods trade, such as import duties, rules of origin and customs clearance procedures.
The Commission has already prepared a customs guide for businesses on how to prepare for Brexit. It guide was drawn up with a no-deal scenario in mind, but it is also useful in preparing for the changes following the transition period: How to prepare for Brexit.
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Regardless of whether or not the EU and the UK reach an agreement on their future relationship, products exported to or imported from the UK will require customs clearance after the transition period. For this purpose, businesses must apply for an EORI number if they do not already have one.
The negotiations on the future relationship will include discussions on customs procedures, including the facilitation of procedures compared to normal third countries. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.
If an agreement on the future relationship is not reached, the UK will become a normal third country and its imports will be subject to the same customs requirements as imports from other third countries, such as the United States or China.
More information on customs procedures in this situation is available on the website of Finnish Customs
More information from the UK authorities on how to prepare for the end of the transition period
Standards and regulation of goods trade
In the event of a no-deal Brexit, the UK and the EU will become two separate market areas with different regulations and controls. This means, among other things, that the requirements for bringing products into the two market areas may change. For example, a company may have to apply for separate permits, approvals or certifications for the EU and the UK.
In the negotiations on their future relationship, the EU and the UK will also discuss issues related to standards and regulation of goods trade. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.
In the absence of an agreement on the future relationship, imports from the UK will be subject to the requirements for imports from normal third countries (such as the United States or China) as of 1 January 2021.
More information on this subject is available on the Commission’s website
More information on exports to the UKImport permits
Imports of certain goods into the EU from third countries are restricted or completely prohibited. These restrictions apply to the import of weapons, plants, food, waste and medicines, for example.
More information is available on the website of Finnish Customs
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The negotiations on the future relationship do not aim to agree on the transfer of personal data. Instead, the idea is that both parties will make unilateral decisions to enable the transfer of data. From the EU’s side, this will be what is known as an adequacy decision. The aim is for the decisions to be made during the transition period. Further information will be provided later this year.
More information on the situation in Finland
More information on the situation in the UK
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The end of the transition period means that the free provision of services from the UK will end. This means, among other things, that UK companies must apply for permission from the Finnish Patent and Registration Office if they wish to establish themselves in Finland. Companies already operating in Finland with a CEO or board members residing in the UK must ensure that they continue to meet the requirements concerning residence in the EEA, as specified in Finnish legislation. In addition, there may be sector-specific requirements for establishment in different sectors.
For more information, visit https://www.prh.fi/en/presentation_and_duties/brexit.html
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In the negotiations on their future relationship, the EU and the UK will agree on the maximum tariffs that the EU and the UK can collect on imports into their territories. Tariffs are one of the key topics in the trade negotiations. The EU and the UK will also negotiate on, among other things, the rules of origin under which a company will be able to benefit from the tariff preferences provided for in the agreement on the future relationship.
Exports of goods to the United Kingdom – UK import tariffs
One objective of the negotiations on the future relationship is to agree on duty-free and quota-free trade between the EU and the UK. The EU and the UK will also negotiate on the rules of origin that must be fulfilled in order for a company to benefit from the tariff preferences. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.
If an agreement on the future relationship is not reached, the UK could introduce import tariffs within the framework of its WTO commitments. The WTO commitments set the maximum tariff that the UK can introduce. The tariff may also be lower than this. On 19 May 2020, the UK published its future tariffs, to be introduced as of 1 January 2021.
More information is available at UK Government website
Britain can change its tariffs within the framework of its WTO commitments.
More information on the UK’s maximum rates of duty under its WTO commitmentsGoods trade from the UK – EU import tariffs
One objective of the negotiations on the future relationship is to agree on duty-free and quota-free trade between the EU and the UK. The EU and the UK will also negotiate on the rules of origin that must be fulfilled in order for a product to benefit from the tariff preferences. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.
If no agreement can be reached on the future relationship, the UK will become a normal third country. In this case, some of the products imported from the UK to the EU (incl. Finland) will be subject to customs duties.
The Market Access Database maintained by the Commission provides product-specific information on EU import tariffs (select a third country, such as the USA, as the country of origin). -
One objective of the negotiations on the future relationship is to agree on cooperation arrangements concerning transport. The negotiations are currently under way. Further information on the content of the future agreement will be provided later as the negotiations proceed.