Seafood trade under the EU-UK Trade and Cooperation Agreement
Published: Thursday 14 January 2021
Content updated: Tuesday 2 March 2021.
- Added new questions and answers; questions 3, 6, 7, 8, 14, 15, 22 ,23, 24, 29, 32, 33, 34 and 35
- Order of questions updated
- Amendment to answers in Q10 and 32
This pages covers some frequently asked questions we have received on trading with the EU and what it means for customs, tariffs and VAT on imported and exported products. This information is guidance only and we would recommend that you check specific details in the TCA.
1. Will there still be checks at the UK/EU borders?
Yes, there will be checks at the EU and UK border to ensure imported and exported products meet the required regulatory standards. Seafood exports from Great Britain (Northern Ireland is treated differently under the Northern Ireland Protocol) will need to be accompanied by the relevant documentation:
- export health certificates
- catch certificates
- customs declarations
Checks will be carried out on a risk basis. Please follow the advice in our I export Seafood guide.
2. Will I need to follow custom procedures and pay tariffs?
The EU and the UK have agreed not to apply import or export duties on goods of UK or EU origin traded between their territories. However the EU and the UK are in separate customs territories. This means customs and VAT procedures, such as the lodging of import and export declarations, will still be necessary even if no tariffs are payable.
We teamed up with the Institute of Export & International Trade to deliver an online seminar in December 2020 on preparing for customs procedures. The information included in the online seminar is still valid under the TCA. It covers:
- What are Incoterms and why are they important?
- Do I need a GB, XI or EU EORI number?
- What can my customs agent do?
- What are customs special procedures?
- What is duty deferment?
Watch the recording below.
3. My goods travel across Great Britain under a transit procedure. Will they need to follow customs procedures and pay tariffs?
If the goods are of non-EU or non-UK origin, tariffs will only be payable if they clear UK customs and are declared into free circulation in Great Britain. Transit procedures allow the goods to be moved through Great Britain under duty suspension. This means import declarations and duties are only required when the goods reach their final destination.
More information on transit procedures can be found in Government guidance or speak with your customs agent or freight forwarder.
Tariffs, Rules of Origin and VAT
4. What goods are classed eligible for zero tariff trade between the UK and the EU?
To be eligible for zero tariffs the goods must originate in the UK or EU (originating goods). This is an economic origin which is wider in scope than geographical origin as it also includes certain products which are not geographically originating but are processed in the EU or UK.
The TCA has criteria for what is classed as ‘originating’ goods. These are known as ‘Rules of Origin’. Defra have produced guidance on Rules of Origin.
5. What are the Rules of Origin (RoO) in the TCA?
‘Tariff-free’ status will only apply to products originating in the EU or the UK. The Rules of Origin (RoO) detail what qualifies as ‘originating’. The TCA allows seafood products to become originating in three ways.
a. Seafood can be ‘wholly obtained’: These are goods that have been exclusively obtained or produced in the territory of the UK or the EU, without using materials from any other country. This includes:
- Fish and shellfish farmed in the UK, including product farmed from imported seed or fry;
- Fish and shellfish caught in UK territorial waters (out to 12 nautical miles from shore);
Fish and shellfish caught outside territorial waters provided it is caught by UK or EU registered or owned vessels. For more detail on the criteria for classification as a UK or EU vessel, please see question 30 or refer to Defra’s Rules of Origin guidance.
b. Bilateral Cumulation: Materials originating from the EU, as well as production carried out within the EU on UK materials, may be considered as also originating in the UK (and vice versa). This mechanism is known as bilateral cumulation.
You can only have bilateral cumulation where seafood originating in the EU undergoes production in the UK (and vice versa). See questions 6, 12 and 13 for an explanation of what ‘production’ would entail.
c. Meet specific production requirements: The seafood has undergone production as specified in the Product Specific Rules (PSRs) below. PSRs support certain types of production to satisfy the RoO requirement. These rules can confer a change of origin to EU, UK or in some cases seafood from other countries, to that of the country of production. In the Seafood PSRs, the conditions needed for seafood to be originating are:
- For Chapter 3 products (i.e. goods classified under customs commodity code 03), all the Chapter 3 materials used in producing them must be wholly obtained as explained under (a) above.
- For seafood products with commodity codes from 160411 to 160418, all the materials of Chapters 1, 2, 3 and 16 used in producing these products must be wholly obtained.
- For seafood products with commodity codes starting with 160419, non-originating (i.e. non-UK, non-EU) materials other than non-originating Chapter 16 materials may be used in their production.
- For surimi that has a commodity code starting with 160420, non-originating (i.e. non-UK, non-EU) materials other than non-originating Chapter 16 materials may be used in their production.
- For all other products with commodity codes from 160420 to 160569, all the materials of Chapters 3 and 16 used in producing them must be wholly obtained.
For the above PSR rules to apply, the production that takes place must go beyond ‘insufficient production’ (Further detail on ‘insufficient production’ (i.e. processing) is given in question 11).
Once a product has gained originating status, it is considered 100% originating. This means that if that product is incorporated in the production of a further product, its full value is considered originating and no account is taken of non-originating materials within it.
6. What are ‘alternative product specific rules’? Do they only apply to canned tuna?
Non-EU and non-UK prepared tuna cannot benefit from tariff-free trade under the TCA unless ‘alternative product specific rules’ apply. These rules are set out in Annex Orig 2A of the TCA and specify an annual quota of non-EU and non-UK canned tuna which can adopt an alternative origin.
7. What are customs special procedures?
Customs special procedures allow you to store, temporarily use or process your goods and get partial or full relief from import duty, or in some cases duty suspension. Financial guarantees are no longer required to use special procedures and they may improve lead times by reducing the risk of congestion at the borders.
Use inward processing to delay or reduce import duties or VAT on goods that you process.
When you export goods outside the UK for processing and then re-import them, you can use Outward Processing to reduce your duty payments.
You can use custom warehousing to delay duty and VAT. You will only pay when your goods leave the warehouse.
You can get relief on certain goods you import from outside the UK if they’re used for specific purposes. This can include processing.
You can import goods into the UK for a limited period before re-exporting them.
8. What are the benefits of using customs special procedures?
Goods placed in duty suspension under a customs special procedure may be able to retain their origin status.
For example, EU originating goods which are exported into Great Britain but placed into duty suspension and not declared into free circulation can be re-exported back to the EU without tariffs being charged. Evidence of the duty suspension may need to be provided (please see question 25).
Goods imported for inward processing will not be liable for import duties if the products are subsequently exported.
9. Are small amounts of non-originating material allowed?
Yes. A final product is still considered UK originating even if non-originating ingredients are used, up to a limit of 10% of the value (ex-works price). Non-originating ingredients can include fish or non-fish material.
10. Does the TCA apply to European Economic Area (EEA) countries?
No, the TCA only includes the EU27 countries. EEA countries are considered as third countries.
Trade with Norway, Iceland and Liechtenstein can continue under World Trade Organisation (WTO) rules or, where applicable, under the terms of those countries’ trade agreements with the UK.
If seafood that originates in an EEA country is imported from the EU, the TCA will not apply and tariffs will still apply.
11. If the UK and the EU have a trade agreement with the same third country e.g. Norway, will material from the third country be considered originating in the UK or EU?
No, the TCA only allows bilateral cumulation using materials originating in the EU and the UK. For example, Norway has trade agreements with the EU and the UK with both parties paying zero or reduced tariffs on Norwegian fish. If fish is imported from Norway for production in the UK it will not automatically become UK originating under the terms of the TCA and tariffs may be incurred if that product is exported to the EU. Similarly, fish imported from Norway into the EU will incur tariffs under the TCA if it is then re-exported to GB. The Product Specific Rules can provide limited exceptions (see questions 6 and 13).
12. What production must fish or shellfish of EU origin undergo to become UK origin to secure zero tariffs when re-exported to the EU?
The TCA does not define the production needed, only that insufficient production is not acceptable. Fish and shellfish that are EU originating need to undergo ‘beyond insufficient production’ in the UK to become UK originating. Note that goods that are not EU or UK originating cannot become EU or UK originating except under the conditions described in question 6 and 13.
We recognise the following activities to be ‘sufficient production’:
- Heading and gutting
- Filleting (specialist skill and/or equipment )
- Production of flaps or wings (specialist skill and/or equipment )
- Skinning (specialist skill or machinery)
- Peeling, shelling or shucking (specialist skill or machinery)
- Cutting of frozen blocks (specialist machinery)
- Splitting of frozen fillet blocks to obtain individual fillets (special equipment)
- Treatment by packaging in gases (specialist equipment )
- Vacuum packing (specialist equipment )
- Coating with batter or breadcrumbs
- Coating in sauce
Only HMRC however can offer definitive advice. If you are unsure whether your processing activity is considered ‘sufficient’, you can apply for binding origin information from HMRC
General examples of ‘insufficient production’ are:
- Simple wrapping, packing and labelling activities
- simple cutting and portioning
- simple placing in bottles, cans, flasks, bags, cases, boxes, fixing on cards or boards and all other simple packaging operations
- affixing or printing marks, labels, logos and other like distinguishing signs on products or their packaging
- simple mixing of products. This can be the same product or different types of product.
- simple addition of water or dilution with water or another substance that does not materially alter the characteristics of the product, or dehydration or denaturation of products
‘Simple’ refers to operations that do not require specialist skills, machines, apparatus, or equipment specifically produced or installed to carry out those operations.
13. Can non-EU/UK seafood be processed in the UK to become UK origin for re-export to the EU with zero tariffs?
There are two instances where the production process converts non-originating product into UK originating product which means it can be exported to the EU tariff free:
- Non-EU, non-UK materials are used to produce a product that is classified as 160419 in the customs classification. This would include, for example, coated frozen fish. For example, Norwegian fish block processed in the UK into frozen breaded pieces with commodity code 160419 will acquire UK origin. Similarly, Russian fish block processed in Germany into fish fingers with commodity code 160419 acquires German origin and can be imported into the UK tariff free.
- Non-EU and non-UK materials used to produce surimi that is classified under 160420 of the customs classifications will acquire UK or EU origin.
14. Can EU goods that were imported into the UK before 31 December 2020 be exported back to the EU tariff-free?
No. Seafood imported into the UK before the end of the transition period can only be returned to the EU tariff free if it undergoes sufficient processing in the UK. This is also the case for UK goods imported into the EU before 31 December 2020.
15. Would fish caught in British Overseas Territories have UK nationality?
No. Fish caught in the territorial waters of British Overseas territories such as the Cayman Islands, Falkland Islands and Gibraltar will not acquire UK origin.
Fish caught in the territorial waters of Crown Dependencies such as Guernsey, Jersey and the Isle of Man will however acquire UK origin.
16. Do the non-seafood ingredients in my products also need to be of UK origin?
Non-originating non-seafood ingredients may be allowed in UK-originating products if:
• They are allowed under the relevant PSR; or
• The value of the added non-originating materials does not exceed 10% of the ex-works price of the product
17. If I buy fish in a GB fish market, such as Peterhead or Grimsby for export to the EU, do I need to know the economic origin of the fish?
Yes, you need to be aware of the economic origin of the fish because this determines whether the fish will be subject to duty if the fish is imported into the EU. If the fish is exported without adequate processing i.e. beyond ‘insufficient production’ (see question 12), you will need to ensure the fish you buy is of UK origin to avoid import duties in the EU.
The following categories of fish will not be of UK origin if caught by:
- EU vessels fishing in EU waters
- EU vessels fishing outside of territorial waters
- UK vessels fishing in EU waters
(see question 31 for more information on vessel origin)
Fish from these vessels can be exported tariff-free if production goes beyond ‘insufficient production’ (see question 12).
Fish bought from third country vessels fishing outside of EU or UK territorial waters will always incur duty on re-export, even with sufficient production, except for production under the product-specific rules (see questions 6 and 13).
The table below provides a summary of how this will apply in practice.
|Territorial water (out to 12nm) in which the fish was caught||Vessel Nationality||Fish origin (from columns 1 and 2)||Direct landing or import into the UK (tariff Y/N)||
Re-export to the EU (tariff Y/N)
|INT||Third country||Third country||Y||Y|
*A correct customs declaration may be necessary for the tariff preference to apply.
18. If I buy fish that was originally landed into NI, and then moved to GB under unfettered access, will this attract tariffs if re-exported to the EU
No. Although fish landed into NI has the benefit of being treated as EU goods for customs purposes, it is still ‘UK fish’, so it can be exported to the EU tariff free either from NI directly or via GB.
19. How do I calculate the ex-works price?
The ex-works price is the price of the product paid or payable to the producer responsible for the last working or processing. The price must include the value of all the materials used and all other costs incurred in the production of the product, minus any internal taxes which are, or may be, repaid when the product is exported.
If there is no price paid or payable, or if the price does not reflect the value of the materials and all other costs incurred, you will need to use an alternative method of valuation. You do this by adding together all the costs of the raw materials, all the costs of production, all administrative expenses and profit. Freight, insurance and other costs related to transport do not have to be included.
20. Would non-originating packaging contribute to the ex-works price when checking if non-originating materials exceed the 10% tolerance by value?
Packaging, packing materials and containers can be disregarded when deciding whether or not a product is originating.
21. Does the importer or exporter make the application for preference i.e. zero tariff rates?
The importer will make the claim for preference (i.e. that zero tariffs apply) by completing the relevant part on the customs import declaration. The importer needs to provide proof of origin to prove that the goods qualify as originating and are eligible to claim preference. In the TCA this proof can take the form of:
- A statement on origin that the product meets the requirements, provided by the exporter on a commercial document; or
- The importer’s knowledge, based on evidence that they hold that the goods are originating.
The requirement to provide supplementary evidence will not apply until 31 December 2021 although you are required now to make the formal claim for preference.
22. What is meant by ‘importer’s knowledge’ and how will it be regulated?
An importer’s understanding of the origin of the goods should be supported by sufficient evidence (see question 25). Importers should ask their exporters for documentation to support their origin claims.
HMRC will see the entry declaration for goods imported into the UK and will know whether a tariff preference was used. HMRC undertakes risk-based audits of importer’s processes and may ask for evidence to support an importer’s knowledge either at the time of import, or at the time of audit.
If importers cannot obtain that evidence, the exporter may be able to provide a Statement on Origin (see questions 22 and 23). Importers should maintain records of supporting documentation for at least 3 years, exporters should maintain records for 4 years.
23. What should a Statement on Origin look like?
In order to make a claim for preferential tariff treatment, a Statement on Origin should be made out in accordance with Annex Orig 4 (p.482) of the TCA.
24. How many products can be covered by one Statement on Origin?
A single import shipment of one or more products or multiple import shipments of identical products within the period specified in the Statement on Origin, which shall not exceed 12 months.
Some consignments may be imported without the need for a formal proof of origin. Commercial imports into the UK valued under £1000 may be imported without a formal proof of origin. This waiver does not however apply to commercial imports into the EU. More information can be found in the HMRC guidance.
25. What evidence will an exporter need to provide?
You should provide your customer (the importer) with sufficient information to allow them to make the declaration of qualifying goods. This could include:
- A ‘statement on origin’ on a commercial invoice or other commercial document that describes where the goods have originated from;
- Supporting documents and records to enable your customer to make the claim that the product is originating based on “importer’s knowledge”.
Further guidance on claiming preferential rates of duty is on the Gov.UK website.
26. Can I claim back tariffs paid on qualifying goods?
Yes. If you have paid the customs duty and later acquire valid proof of a product’s origin, you may be able to apply for a repayment of the duty after you have imported the goods. If you paid a duty that was not legally due, you have up to 3 years to make the claim, although shorter time limits can also apply, depending on the exact reason the duty was paid.
Further information on how to claim back duties paid is on the Gov.UK website.
27. Do I still need to pay VAT on qualifying goods?
Goods exported from the UK are exempt from VAT on proof that the goods have left the UK. However, exports will attract VAT in the importing country; this may not be the country where the product first enters the EU but rather the country where the product reaches its final destination.
Each Member State sets its own VAT rates which can be found by commodity code on an EU database.
Seafood is zero rated for VAT in the UK so seafood imports will also be zero rated on import. These goods will also be exempt from any local VAT on export from the exporting country.
For more information on VAT, including direct sales with the EU, Accountancy Europe have produced advice covering different trading scenarios.
28. If I import seafood using the Generalised Scheme of Preferences (GSP), can I re-export them to the EU with reduced tariffs?
GSP goods are non-originating materials, so they do not qualify for preferences under the TCA if they are re-exported from the UK to the EU or from the EU to the UK.
29. If I import seafood into the EU using GSP and process it in the EU, can I export the processed product to the UK with reduced tariffs?
Question 13 and question 6 summarise the instances whereby a production process can convert non-originating product into EU originating product and therefore allow it to be exported to the UK tariff free.
In any other scenario, under the terms of the TCA, importing these products into the UK will attract tariffs.
30. What are the criteria that must be met for a vessel to be classified as EU or UK under the TCA?
A fishing vessel is a ‘vessel of a Party’ or a ‘factory ship of a Party’ if it meets the following criteria:
- Is registered in the United Kingdom or an EU Member State.
- Sails under the flag of the United Kingdom or a Member State; and
- Meets one of the following conditions:
- is at least 50% owned by nationals of the United Kingdom or a Member State; or
- is owned by legal persons which each:
- has its head office and main place of business in the United Kingdom or a Member State; and
- is at least 50% owned by public entities, nationals or legal persons of the United Kingdom or a Member State.
31. What is the origin of fish landed into the UK or EU by UK or EU flagged vessels?
Fish caught within the UK's territorial waters (out to 12nm) is UK fish regardless of whether it is caught by an EU or a UK registered vessel. The converse applies for fish caught from EU territorial waters.
Once beyond territorial waters the origin of the fish is determined by the flag of the vessel that catches it.
- Fish caught beyond the UK's territorial waters, and beyond the EU's territorial waters, by a UK registered vessel that is then landed into either a UK or EU port is UK origin fish.
- Fish caught beyond the UK's territorial waters, and beyond the EU's territorial waters by EU registered vessels and landed into either a UK or EU port is EU origin fish.
The Rules of Origin specify that UK fish can be landed into the EU tariff free, and vice versa. Complications arise if this fish is then re-exported to the EU or the UK. The Rules of Origin specify that EU fish imported into the UK can only be exported back to the EU if it has been sufficiently processed (see question 12) so that it becomes UK originating material. This will mean that if EU fish is landed into Peterhead and then loaded onto a truck and freighted to Europe, it will attract tariffs at the UK/EU border. The same will apply for fish that lands into Hantsholm in Denmark that is sent back to the UK without any processing – tariffs will need to be paid when the fish crosses from the EU to the UK.
In 2019 UK registered vessels landed 143,160 tonnes directly into the EU. For the same period EU registered boats landed 34,600 tonnes into the UK.
32. Where my goods are not eligible for tariff-free trade under the TCA, do the applicable duty rates depend on the commodity code for my goods?
Yes. Different commodity codes generally incur different tariff rates. See question 33 for details on tariff rates that apply outside of the TCA.
33. Where can I find tariff information for my goods which are not eligible for tariff-free trade under the TCA?
The links below have details on tariffs that apply outside of the TCA:
34. Is the tariff based on the sales value of my import?
Import tariffs on seafood are always a percentage of the value of the import. For customs purposes, the value is usually the price you paid when you bought the goods, before they were imported into the UK. This is called the ‘transaction value’. You may be required to include costs such as packaging to this value.
More information and alternative methods for calculating the value of your goods can be found in government guidance.
35. How do I pay tariffs on my imports?
However you import your goods, the company who does the customs clearance will most likely contact you to confirm how much you owe and how to pay it.
You can use the flexible accounting system to pay customs duties at the time the goods enter the UK or if you have a duty deferment account, you can delay payment until an agreed future date.
Do you need help?
For help with anything to do with trading with the EU, email email@example.com
Tuesday 2 March 2021
- Added new questions and answers; questions 3, 6, 7, 8, 14, 15, 22 ,23, 24, 29, 32, 33, 34 and 35
- Order of questions updated
- Amendment to answers in Questions 10 and 32
Monday 8 February 2021
- Added Seafood Rules of Origin (RoO) webinar to question 5, 'What are the Rules of Origin (RoO) in the TCA?'
Friday 22 January 2021
- Added new question and answer, Q.17
- Added new question and answer, Q.18
- Order of questions updated, Q. 19 onwards
Friday 15 January 2021
- Amendment to question 8, 'What production must fish or shellfish of EU origin undergo to become UK origin to secure zero tariffs when re-exported to the EU?' and answer.