Exporting to Europe & the UK post Brexit
In this blog we look at the impact of Brexit on placing goods on the EU single market after 1st January 2021, with a spotlight on Biocide manufacturers. Please note, at the time of writing (November 2020), we’ve assumed a deal will be reached and the principles agreed in the EU Withdrawal Agreement Act 2020 will be applied.
UK manufacturers and exporters to the EU
Firstly, UK manufacturers based in the EU and UK that export to the EU must make sure they understand the EU Commission’s definition of ‘placing on the market’. The guidance defines this as making a product available for the first time on the Community (EU) market with a view to distribution or use in the EU.
Any goods that are placed on the EU single market after the end of the transition period will need to ensure that they conform with EU goods regulations. However, the good news is that UK manufacturers’ obligations will remain mostly unchanged after 1st January 2021, apart from ensuring they are aware of, and complying with, EU labelling requirements.
In addition, if a manufacturer has already placed goods on the market in an EU member state, (other than the UK) before 1st January 2021, then they will be able to continue in circulation after the end of the transition period .
If products are exported from the UK into the EU single market after 1st January 2021, they must be labelled with details of an importer based in the EU or EEA. Products that don’t have a label detailing a UK company as the importer will not be permitted to be placed on the EU single market after the UK leaves the EU. This includes labels applied before 1st January 2021.
At the end of the transition period UK-based authorised representatives will no longer be recognised by the EU. An ‘Authorised Representative’ is a natural or legal person established in the EU, EEA or Switzerland who, explicitly designated by a non-European manufacturer, acts on its behalf in carrying out certain tasks required in the applicable directives. Where reference is made to the term ‘manufacturer’, it is understood as indicating either the manufacturer or its representative.
The delegation of tasks from the manufacturer to the authorised representative must be explicit and should take place in writing; in particular it should ensure that it clearly defines the contents of the tasks and limits of the representative’s powers. The tasks that may be delegated to the authorised representative are fundamentally of an administrative nature and the authorised representative cannot generally modify the product on its own initiative in order to bring the product in line with the applicable directives.
By way of an example, a manufacturer may be able to arrange for this relationship, as a commercial matter, with a distributor of its products, if it has one in place.
However, it’s important to understand that the manufacturer remains ultimately responsible for actions carried out by an authorised representative on its behalf.
EU manufacturers and exporters to the UK
Many of the points that apply above to UK Manufacturers and Exporters to the EU – placing on the market, distribution and authorised representatives – also apply to EU Manufacturers and Exporters to the UK market.
In practice, this means that EU companies will need to establish a place of business or appoint an authorised representative in the UK (specific guidance should be obtained on the detailed requirements of applicable regulations).
For companies wishing to establish their own operation this will mean either:
- Setting up a place of business or branch of the company in the UK as an overseas company in the United Kingdom. A “place of business” is premises where there is a physical or visible indication that a company may be contacted there, or a particular location where the company conducts its business, even if there is no such physical or visible indication. A “branch” is a part of a company that is organised to conduct business on behalf of the company.
- Setting up a subsidiary of the company, typically this will be a private company limited by shares with no minimum capital requirement and no requirement that directors be UK nationals or based in the UK. However, a UK registered office address is required and at least one ‘natural’ person as a director.
Biocide exporters – sector in focus…
As part of changes brought about by Brexit, from 1st January 2020, the Health and Safety Executive (HSE) will replace the European Chemicals Agency (ECHA) as the competent authority in Great Britain*, impacting Biocide manufacturers and their exporting arrangements.
After the 1st January 2020, Biocide manufactures wishing to export to Great Britain (GB) and importers into GB will have apply to the HSE for approval on the equivalent of the ‘Article 95’ list. In practice, this means that companies will need to submit supporting data or other information to HSE that had previously been submitted to ECHA or other Competent Authorities using active substance dossiers or letters of access to do so.
However, to allow for the adjustment a two-year phase-in period will be provided to ensure Biocide exporters have time to meet the new requirements. The HSE has also allowed a one-year period until 1st January 2022 to allow GB biocide product authorisation holders to become established in Great Britain. This is a requirement for all exporters and can be easily achieved in a number of legally compliant ways (see the previous section of this blog).
What about affiliates?
Only a company that is listed in the Article 95 list – whether that is the EU list for the single market or HSE’s list for GB – can place active substances and biocidal products on the market.
If a company is included in the Article 95 list, its affiliate companies are not automatically listed or explicitly covered by this listing and so if they are selling active substances or biocidal products in the EU or GB, they must be able to demonstrate that it is through a supply chain linking the product to the company on the EU list in respect of the single market and a company on the HSE list in respect of the GB market.
Of course, this may create practical and regulatory issues for EU companies in particular. Biocide exporters will need to carefully check that letters of access apply to affiliate companies and how they can facilitate the use of the letter of access in ‘overseas’ (i.e. UK) applications.
Specialist corporate legal advice
If you think your business will be affected by these changes and you would like advice about how to navigate the technical aspects, our Corporate legal team is on hand to help. Please call 0117 906 9400 or email email@example.com
(*Great Britain encompasses the UK excluding Northern Ireland, which is treated separately as part of the ‘no border’ arrangements that will apply to the island of Ireland)