Dear business partners
The outcome of the Brexit process is currently far from clear, but one possible outcome is a hard Brexit (no deal). We would like to alert you to the potential resulting supply chain risks.
In any scenario, there is a high risk that the UK Customs Authorities will not be able to secure sufficient additional custom officers before March 29th deadline and therefore will be overwhelmed with extra customs documentation related to imports and exports to/from EU countries. This could lead to major congestions in the UK seaports during the first days, weeks or months after the Brexit. Temporary closure of transport lines to the UK may also take place. Duties imposed on imports may also reasonably be expected and certainly in the case of a hard Brexit with no agreed deal.
All parties, from a supply chain point of view, should be aware that much longer lead times during the Brexit period could take place. In addition, EU/EEA wide harmonized standards may no longer include British standards for production of goods and performance of services further complicating import & export activities.
Whilst this uncertainty continues we cannot guarantee lead times or provide definitive answers or solutions. We recommend to all our UK customers to extend your order lead-times by several weeks from today’s levels (and at absolute minimum by 10 days) to decrease chances of supply disruption. In addition to placing your orders in anticipation, we would also recommend that you build a safety stock before end of march and again to prevent any risk of shortage.
Contracts will be reviewed individually and in the case of new taxes and duties pricing or Incoterms will be reviewed on a case-by-case basis.
Elkem Silicones has obtained Authorised Economic Operator (AEO) status which will eventually ease future customs operations.
We will remain in close contact to find the right solutions. Elkem Silicones is working on propositions to see how all concerned parties (customers, suppliers & carriers) could manage the situation with a minimum of disruption and extra cost for our day-to-day business together.
If you have further questions, then please raise these to your local sales representative.