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Child’s play: how a family toy business navigated new import rules

Credit: Capikooa
Credit: Capikooa

Promotional feature from HM Government

New rules for businesses moving goods from the EU to Great Britain came into effect on 1 January 2022. Here’s how one company adapted to keep their business moving.…

With a toddler already and another baby on the way, Warren Raven and Maria Bataller were disappointed with the poor quality and limited use of the average children’s toy, so they decided to make their own.

Three years ago, the couple founded Capikooa and began producing high-quality wooden balance boards so sturdy they claim they’ll be handed down from generation to generation.

“As parents, we wanted something that had multiple uses and open-ended play,” Warren tells Yahoo Finance.

“Where kids could use their creativity and imagination. Something that was actually durable, lasted a long time, and would potentially be passed on through generations.”

In the three years since it was founded, Brexit has meant Capikooa, like other small businesses, has had to plan for new rules and regulations, the latest of which came into effect on 1 January 2022.

For Warren, this meant changes to how they import their high-quality beechwood balance boards from Spain.

“Our first batch was made in China,” he says.

“But then we switched our manufacturing to Spain because my partner is Spanish and we wanted to reduce our carbon footprint, with our products made closer to our market in the UK.”

Under the new rules, companies importing from EU countries need to do a number of things. The first requirement is to check if new rules apply to your business; the Government has a full checklist here.

If they do apply, you then need to obtain an Economic Operators Registration and Identification number (EORI number).

You’ll also need to know about Rules of Origin. These determine the national origin of products, meaning they can be imported or exported at preferential rates under the UK-EU trade agreement.

To do this, you must have proof that goods you bring into the UK from the EU originate there, and that goods you export to the EU originate in the UK. The Government has extensive guidance on how to find and obtain this proof.

The next step is to prepare a customs declaration – and you don’t necessarily have to do this all yourself. Businesses can pay a transporter or a customs agent to do the paperwork for them, either as a direct or an indirect representative.

“The biggest thing for us is drawing up the declaration of conformity and the customs declaration for import because we now have to do a full declaration.” says Warren. “It's quite straightforward – you have to say where the product comes from and prove that we provide a commercial invoice which shows that.”

“It's more about proving where the actual product comes from. That's not been a big problem for us - we use a third-party company that takes care of the documentation for us.

“We also work with a logistics company. They ask for the necessary documentation up front and handle that aspect for us. They then use a third party to do the customs declaration and import for us, though this can be a little more expensive than doing it yourself.”

Credit: Capikooa
Credit: Capikooa

If you’re doing it yourself, you’ll need to find out the commodity code for your goods, their value and then if you can either reduce or delay the amount of Customs Duty you owe due to the trade agreement between the UK and the EU.

There are additional licences and certificates needed for high-risk, dangerous or potentially hazardous materials such as medicines, animal and plant products, and waste. You will also need to ensure everything is labelled correctly.

There is one more potential process to make things easier – businesses can apply for authorisation to use simplified declarations, which allows the movement of some goods into a customs procedure without having to provide a full customs declaration. It can take up to 60 days to complete all the checks needed to qualify for this, so this will need to be factored into any import plans you have.

You’re then ready to bring your goods from the EU through customs.

The information in this article was correct at the time of publication

Read more in our Post Brexit Trade section on Yahoo Finance