Insurance · 18 July 2017

What are import and export licences and why are they important?

Shot of two warehouse workers standing on stairs using a digital tablet and looking at paperwork
The Department for International Trade will likely be the first port of call for exporting companies

Before joining Britain’s growing community of small exporters, it’s essential to understand the correct legal procedures. Here, we take a look at the importance of import and export licences and when they might be required.

Primarily, exporting goods from the UK without a licence could result in confiscated items, fines and prosecution. Holding the correct paperwork will help prevent transport and processing delays and allow goods to be taken through customs efficiently.

The Department for International Trade (DIT) outlines the different factors likely to determine whether a business owner will require import and export licences:

  1. Type of product
  2. A product’s commodity code
  3. Product’s origin
  4. The product’s destination

Commodity codes

Commodity codes are an essential aspect of overseas trade. Whether imported or exported, all goods moved within the EU must have an eight-digit number, and a ten-digit number for the rest of the world.

GOV.UK provides assistance for business owners seeking correct commodity codes, duty and VAT rates.

Goods that require an import licence

Most goods can be imported to the UK without any restrictions. For certain items, however, such as firearms, food, plants, medicines and animals, import licences might be required. The country of origin could also be a factor on the degree of control.

Generally, there are three different kinds of import control – full bans, volume quotas and surveillance.

Food importers

For small food businesses reliant on imported goods like meat, dairy, livestock and plant-based products, the Department for Environment, Food and Rural Affairs (Defra) issues import licences. Real fur is treated in the same way.

Food products likely to be affected by avian flu, or even food colouring, have a blanket ban and cannot be imported.

Defra offers a Plant Health Guide for importers bringing fruit, vegetables and plants that might require a Quarantine Release Certificate (QRC).

There are also specific guidelines for business owners importing goods to be marketed as organic. To sell organic produce from outside the EU, you must register with an organic control body. Organic food from within the EU does not require you to register, but imports must have come via an EU-registered producer.

The Food Standard Agency’s imported food safety regulations must be followed by importers of all produce at every stage. All food must comply with national regulations such as additive levels and labelling.

Goods that require an export licence

Artwork and antiques

An export licence is required in order to sell “objects of national interest” overseas. This covers antiques, books and works of art over 50-years old and of a certain value.

Licences to export such items are issued by the Arts Council.

Vehicles

Motor vehicles under 50 years-old don’t generally require export licences to be sold overseas. However, the Driver and Vehicle Licensing Agency (DVLA) must be notified.

Live animals

There is a diverse range of licences you may be required to obtain when exporting live animals and animal-based products like meat and dairy. As with imports, Defra oversees such goods.

The destination country might also require certain assurances around animal and public health, and the demands of veterinary authorities may vary significantly.

To assist Defra, business owners exporting live animals are responsible for conforming to the conditions demanded by the importing country as well as allowing enough time for certification to be approved. 

Medicines and prescription drugs

Medical firms exporting prescribed products should seek licences from the Medicines and Healthcare Products Regulatory Agency (MHRA).

The MHRA issues four types of certificate for overseas sellers – pharmaceutical product details, manufacturing status, licensing status and ingredient certification. 

Government support for exporters

UK Trade and Investment (UKTI) is the national body that provides support for business owners looking to access international markets.

UKTI publishes monthly export opportunities for domestic firms and provides access to a regional network of international trade specialists around the country.

Special “e-exporting” programmes are available for online businesses, as well as tailored services for first-time exporters.

Implications of Brexit on import and export licences

As much of the UK’s international trade legislation reflects its status in the European Single Market, the post-Brexit import and export landscape could look very different in the coming years.

For example, if Britain leaves the Single Market, import tariffs would be added to goods, while trade deals negotiated with countries outside of the EU could see it cheaper to buy and sell from those nations.

Ten tips to make international trading simple

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ABOUT THE EXPERT

Simon Caldwell is a reporter for Business Advice. He has a BA in politics and communications from the University of Liverpool, and previously worked as a content editor in the ecommerce industry.

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