In 2021, the United Kingdom officially left the EU (European Union). This exit is commonly known as Brexit.
The exit has created a wide array of changes in the UK, but even more complications have arisen in The Republic of Ireland, as the country has chosen to remain a full member of the EU. Trade and imports between Ireland and the UK dropped by 65% in 2021 during COVID as a direct result of Brexit.
Brexit has altered supply & trade, custom duties, and intellectual property rights between the UK and Ireland. This is the first time the two countries haven’t co-existed together in the EU since the 1970s.
Companies hoping to expand or business that already have entities set up in Ireland need to understand what these changes will mean for their business. Here's a look at the 7 most significant changes in Ireland post-Brexit.
The largest change in Ireland following the passage of Brexit comes from the Northern Ireland Protocol. This agreement is made as part of a deal to keep the Good Friday Agreement in place. This is a 1998 peace deal made between Northern Ireland and the Republic of Ireland (the sovereign state part of the EU). The Good Friday agreement was put into place in order to eliminate hard borders between the two areas.
However, protecting this agreement has created a lot of difficulties, as the EU requires inspections of specific food items like meat, fish, eggs, and milk before they enter the market in the EU. So, while the Republic of Ireland does not require hard borders, or inspections on these foods, goods from the Republic of Ireland arriving in the UK (and vice versa) do require these hard border inspections.
This creates a lot of extra paperwork and difficulty when these products move from the UK into Ireland, especially since Northern Ireland (part of the UK) and the Republic of Ireland share a land border.
There was a three-month period and extended grace given under the Northern Ireland protocol, but businesses supplying these products are still seeing significant supply chain delays.
Under the post-Brexit changes in Ireland and the UK, there has been a change with the rules of origin for imported and exported goods.
EU rules of origin require that certain goods need a certificate of their origin and the payment of a significant customs duty when they move between EU and non-EU markets. Goods originating from an approved partner country qualify for a reduced or waived customs duty.
In order to qualify for these zero tariffs, goods traveling between Ireland and the UK must be certified as originated in Ireland or the UK. These qualifications for reduced tariffs will differ depending on the product. Companies that hope to receive these reduced or zero tariffs must prepare an official Statement of Origin and file it with the shipping paperwork.
For some people, traveling between the United Kingdom and Ireland may be difficult because of changes to visa requirements.
Citizens of Ireland and the UK may travel, work, and live in either of the two countries under the terms of the Ireland-UK common travel area arrangements, which have been put in place for many years. However, other international employees of either country looking to travel between the two countries will need to meet new visa and passport requirements that have been established for both countries post-Brexit.
New border controls, tariffs, checkpoints, and excise duties have made the movement of goods between Ireland and the UK a lot more complicated following Brexit changes.
These new rules have created bottlenecks and delays for UK distributors who use legitimate ways to repackage products before sending them into the Irish market. These changes have led to significant supply delays, shortages, and empty shelves in Ireland.
Irish companies must now learn new customs regulations, paperwork, and custom declarations. Unfamiliarity with these changes have led to even further delays in the supply chain.
Following Brexit, intellectual property rights have completely changed. EU trademarks no longer have any protection or recognition in the UK.
Irish companies that plan to work and operate in the United Kingdom will need to apply and receive UK trademarks (in addition to their EU trademarks) to protect their company's intellectual property in both the UK and the EU.
In most instances, Brexit has not caused any major tariff problems between the UK and Ireland.
The TCA gives the two countries quota-free and tariff-free access to each other’s markets for trade in all goods and agriculture.
Only goods originating in the UK and the EU benefit from these tariff-free opportunities. Some companies in Ireland and the UK will face some tariffs, due to the manufacturing of certain goods in non-EU or non-UK countries.
Another big change in Ireland post-Brexit is changes to how employment structures function. Irish companies that employ non-EU, non-Irish, or non-UK citizens in the UK will need to apply for work permits for employees that fall out of those three categories.
They will also need to apply for sponsorship licenses under the new EU settlement scheme, which determines visa eligibility for EU citizens who plan to move to the UK.
If businesses operate in both the UK and Ireland, they are subject to comply with the new legal systems put into place in both countries. This makes the employment and immigration process that much more confusing.
As the UK is no longer part of the EU, Ireland now remains the only country in the European Union that is made up of predominantly native English speakers. Ireland has already attracted a lot of companies based in English-speaking countries to set up shop in the country. Many financial institutions that previously had a large number of assets and businesses in the UK have transferred these assets to Ireland. Over 7,500 jobs were relocated from London to Dublin in 2020.
It’ll be interesting to see where the future of business takes Ireland.
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