Exporting beer

Question

I have several local micro brewers wishing to use my services in exporting their products. In Europe to start with. We have not confirmed a specific Country as yet. My question is, I have been told in the past that exporting alcohol is expensive and in most cases troublesome, is this still the case. It appears many brewers both large and small are still doing it and seems as popular as its ever been. Any advice would be gratefully received.

Gary

Answer

Gary,
I have just finished an assignment with a food and beverage exporter in London and have assisted them in exporting a few pallets of “craft beers” to Sweden.

The process for exporting beer to any country within the EU is reasonably straight forward. All exports from the UK must be through the Excise Movement & Control System (EMCS) and be covered by a movement guarantee.

The usual practice is to export alcohol under bond from a registered bonded warehouse which means that exports are conducted without duty having been paid. You can export alcohol with UK duty paid and claim the duty back once the goods have been exported and proof provided that the goods were exported and not consumed in the UK. However, the first method is preferable.

The duty paid by the importer will differ from EU country to country and is usually dependent on the alcohol strength of the beer. The higher the alcohol by volume the higher the import duty paid by the importer.

Beer exports from the UK were worth more than £600 million in 2012. North America is the largest non-European destination for British beer, with Ireland, France and Belgium being our biggest trading partners within the EU. Italy, Spain and the Scandinavian countries also consume significant amounts of British beer and don’t forget China. The Chinese have taken a liking to specialist beers from many countries so always worth considering. Also, if England qualify for Brazil 2014 later on this evening you might like to consider Brazil.

The tricky bit is ensuring that the labelling requirements for each country are covered. This will add a little to the cost especially at the beginning when orders are small. Don’t get this part of the process wrong or it will cost you dearly!

Regards,
Richard England
r.england@consultingforexport.net

Answer

Hi Gary,

Exporting beer from small breweries is definitely popular at the moment. We help several with their Customs and export documentation requirements. I would suggest taking a look at HMRC Notice 197 (http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_ShowContent&propertyType=document&columns=1&id=HMCE_PROD1_025227) where you will find sections on storing, moving and exporting alcohol under duty suspension which obviously saves your customers paying the duty if the goods are moving between warehouses in Europe.

Let me know if you would like to speak to us directly about how we can help or to one of our customers about how they do it, as I am sure there are other considerations that need to be made. There are also trade associations which have Export Clubs that can help support you.

Kind regards,
Ian

Answer

Gary,

Correspondingly, we’ve had a similar experience with motor oil. Taxes and tariffs are high, bonding, customs, etc. All this not including logistics costs. Liquids, and in your case glass bottling, is heavy and costly.

We found it best to find local blenders (brewers) already operating in the country of interest and working out a “white label” deal with them. Get NDAs in place prior to releasing your formula and have it produced locally. Moreover, you can play the whole “green” angle as you’ll be reducing carbon emissions due to transport.

I have some more input, if you’d like to hear it.

Regards,
Mike Fachetti
CEO – UCS NY

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