Brexit headaches for sports nutrition and small businesses as new regulation comes into force
04 Feb 2022 --- The UK’s latest Brexit restrictions have created new challenges for the sports nutrition industry and small businesses due to new rules around animal-derived foods like dairy. However, industry preparations mean that other impacts are so far relatively minor, according to a host of representatives who speak to NutritionInsight.
“Brexit brings a series of challenges to EU and UK companies as it has increased uncertainty and supply chain disruptions,” says Dr. Adam Carey, chair of the European Specialist Sport Nutrition Alliance (ESSNA).
In particular, the financial impact of UK businesses sending their products to the EU has been “phenomenal,” adds Sam Jennings, technical adviser to the Council for Responsible Nutrition UK (CRN UK).
No extensions for new paperwork
The new import and export rules now require full customs declarations instead of offering the ability to postpone them to the point of arrival, as was the case throughout 2021.
“Now, related paperwork has to be handled upfront and notice on the import of these products needs to be given in advance,” Carey explains.
However, Jennings has not heard of any major issues for the nutrition industry relating to the pre-notification requirements. “Of course, the information required at this point in time is reduced in comparison to when full border checks will be implemented [in July].”
Some businesses must also now obtain different export licenses or certificates, while there are certain marking, labeling and marketing rules for products like food.
Extra scrutiny on animal products
Since January, products of animal origin have been under especially tight regulation – which has an impact on many sports and active nutrition products, in particular. Carey points out that the costs of obtaining export health certificates (EHCs) for products of animal origin have added considerably to companies’ outgoings.
Jennings adds that costs for one single EHC to send a batch of products to Northern Ireland or the EU can range from £90 (US$122) to £100 (US$136), depending on how long the certifying vet needs to spend on it.
“This is a very large increase on the product’s ‘cost of goods,’ which will then be reflected in an increase in retail price. For many small and medium enterprises, this has resulted in a reduction in the number of products they send to Northern Ireland and the EU,” she says.
Carey highlights that the UK government “only gave industry one month” to prepare for full customs control.
“As a result, many businesses were unaware or not fully prepared for the new border control checks. This particularly impacts small businesses, with Federation of Small Businesses research suggesting one in four small businesses was not aware of the changes.”
Good preparations soften blow
Otherwise, the specific measures that came into place on January 1 2022 have so far had a relatively small impact for most of industry.
“We have heard that, in the first week or so, there were cases of companies across all food sectors not having their customs documentation ready, but the numbers of such cases are apparently reducing considerably,” says Jennings.
“Retailers have worked prudently over the past months to ensure that their suppliers are aware of the new obligations under the new border operating model,” adds Aodhán Connolly, British Retail Consortium’s trade policy advisor.
Graham Keen, executive director of the Health Food Manufacturers’ Association (HFMA), adds that thanks to months of preparation, HFMA members are in the best position within their own business models to manage these changes.
“It is very early days and, so far, we are unaware of any significant issues for our members’ product,” he says.
Pressures could build
Many retailers also took the precaution of stocking up where possible to alleviate any supply chain pressures at the start of the year.
“This hard work has paid dividends in ensuring a relatively smooth first week of the new year. However, as time goes on, volumes will increase and pressures will be more tangible,” Connolly continues.
“We continue to monitor the situation and work with Her Majesty’s Revenue and Customs (HMRC), Department for Environment, Food and Rural Affairs (DEFRA) and the Border and Protocol Delivery Group, to ensure that goods flow smoothly and we keep choice and affordability for UK households.”
Keen also flags some HFMA companies are likely to encounter challenges presented by these new requirements.
“As ever, we will be there to support them. Members thus far had stated there have been no particular difficulties in terms of the movement of goods, following Brexit regulations. However, it might still be too early to say,” he adds.
“The partnership between the EU and the UK has entered into a new era where the two sides now have to work more closely than ever. Brexit is not done and dusted,” concludes Carey.
By Katherine Durrell
To contact our editorial team please email us at editorial@cnsmedia.com
Subscribe now to receive the latest news directly into your inbox.