DUBLIN, Ireland – Irish minor and medium-sized enterprises (SMEs) are set to benefit from a new service designed to streamline exports to the United Kingdom, a market increasingly challenging to navigate following Brexit. Launched today, UK Direct, operated by An Post in partnership with Royal Mail, aims to alleviate the complexities and delays that have plagued Irish businesses trading with Britain since the UK’s departure from the European Union.
The service offers a comprehensive, end-to-end parcel delivery and returns solution, including pre-cleared UK customs and a guaranteed three-day delivery timeframe for e-commerce parcels. This addresses a significant pain point for Irish businesses, many of whom have struggled with the increased administrative burden and associated costs of post-Brexit trade. The UK remains a crucial market for Irish exporters, and this new initiative seeks to re-establish a smoother pathway for goods to reach British consumers.
The launch of UK Direct comes as data reveals the significant impact Brexit has had on Irish SME exports. A 2024 survey by the Strategic Banking Corporation of Ireland (SBCI) found that 34% of Irish SMEs had either reduced or ceased selling to customers in Britain due to the changes in trading patterns. Specifically, 26% reduced their sales, although 8% stopped exporting to the UK altogether. This highlights the urgent need for solutions that simplify the export process and reduce the barriers to trade.
Addressing Post-Brexit Trade Barriers
Since January 1, 2021, new customs rules have been in effect, altering the landscape of trade between Ireland and Great Britain (excluding Northern Ireland). These changes, coupled with the removal of the €22 VAT exemption on goods entering the EU from non-EU countries in July 2021, have created a more complex regulatory environment for Irish businesses. An Post’s UK Direct service directly tackles these challenges by handling customs clearance in advance, providing businesses with a simplified process and reducing the risk of delays.
David McRedmond, Chief Executive of An Post, emphasized the importance of the UK-Irish trade relationship, stating that We see “central” to Ireland’s economy. He explained that the UK Direct facility “reopens that market for businesses facing the challenges posed by Brexit.” McRedmond further highlighted the vital role of SMEs, noting that “Ireland’s 400,000+ SMEs are the backbone of this economy, and in building new infrastructure for Ireland, An Post is opening doors to new trade with the UK through a full end-to-end service.”
The service is designed to provide Irish SMEs with access to the UK’s 69 million-strong consumer market, removing the administrative hurdles that have previously hindered growth. By handling customs payments upfront and offering end-to-end tracking, UK Direct aims to provide businesses with greater control and visibility over their shipments. The integrated returns service further enhances the offering, simplifying the process for customers and reducing the logistical complexities for businesses.
The Impact on Irish Exporters
The introduction of UK Direct has been welcomed by industry representatives. Simon McKeever, Chief Executive of the Irish Exporters Association, described the announcement as “a positive shift in how Ireland can do business with our nearest neighbour.” He believes that the UK market, “a massive market ready and waiting for quality Irish products,” is now more accessible to Irish SMEs thanks to this “practical and highly innovative” service.
The complexities of post-Brexit trade have extended beyond customs procedures. Irish retailers exporting to the UK are now required to apply for a Great Britain (GB) Economic Operators Registration and Identification (EORI) number and register for UK taxes. for parcels with a declared value of up to €150 (£135), a new UK VAT scheme applies, requiring Irish retailers to pay VAT directly to HM Revenue and Customs (HMRC). UK Direct aims to simplify these requirements for businesses, offering a streamlined solution for compliance.
British Ambassador to Ireland, Kara Owen, also expressed her support for the initiative, stating that it demonstrates “strong cooperation between An Post and Royal Mail.” She emphasized the desire for “simple, dependable ways to reach their customers” on both sides of the Irish Sea, adding that UK Direct “delivers exactly that.” Owen also highlighted the economic significance of the UK-Ireland relationship, noting the €2 billion a week in trade between the two countries.
How UK Direct Works
An Post describes UK Direct as a “full turn-key solution” that includes advance customs payments, three-day delivery with end-to-end tracking, and an integrated returns service. Businesses can register to integrate with the service, allowing them to seamlessly manage their exports to the UK. The pre-cleared customs aspect is particularly significant, as it eliminates the need for businesses to navigate the often-complex customs procedures themselves.
The service is designed to be particularly beneficial for e-commerce businesses, which often deal with a high volume of smaller parcels. The three-day delivery timeframe provides a competitive advantage, ensuring that customers receive their orders quickly and efficiently. The end-to-end tracking feature offers transparency and allows businesses to monitor the progress of their shipments in real-time.
For parcels with a customs declared value up to €150 (£0-£135), VAT is applicable, and the new UK VAT scheme will apply. For parcels with a declared value exceeding €150, both customs duty and VAT may be levied, depending on the specific goods being exported. An Post’s UK Direct service handles the calculation and payment of these charges, simplifying the process for businesses.
Looking Ahead
The launch of UK Direct represents a significant step towards easing the trade challenges faced by Irish SMEs in the post-Brexit era. While the long-term impact of the service remains to be seen, it offers a promising solution for businesses seeking to maintain and expand their presence in the UK market. The service is now available for registration, and An Post anticipates a strong uptake from Irish businesses eager to capitalize on the opportunities presented by the UK’s consumer base.
The ongoing evolution of the UK-EU trade relationship will undoubtedly continue to shape the landscape for Irish exporters. An Post has positioned itself as a key facilitator of trade, adapting to the changing environment and providing innovative solutions to support Irish businesses. The success of UK Direct will likely depend on its ability to deliver on its promises of streamlined customs clearance, efficient delivery, and reduced administrative burden.
The next step for businesses interested in utilizing UK Direct is to register for the service through the An Post website. Further updates on the service’s performance and any potential changes to the UK-Ireland trade relationship will be closely monitored. We encourage readers to share their experiences with UK Direct and to engage in a discussion about the challenges and opportunities of post-Brexit trade.