UK Registrars Group : ERC 2018 - Planning for Brexit: A Practical Overview

Panel Discussion - Planning for Brexit: A Practical Overview

Panel:
Chair: Jane Knowles, Head of Exhibitions, The National Gallery, UK
Idoya Beitia, Head of Exhibitions Management at Royal Academy of Arts, UK
Anastasia Tennant, Arts Council England
Steve Gourley, Business Process and Compliance Manager, Momart Limited, UK
David Rowland, Head of EU exit and international strategy, Museums Team, DCMS

Michael Landy, Brexshit, Pen and ink on paper, 21 x 29.7 cm, 2018
Work will be part of Drawing Biennial 2019 at Drawing Room, London, 20 Feb to 26 Mar 2019 which culminates in an online auction in the exhibition’s final two weeks.

As of writing (mid Dec 2018) the UK government has informed businesses and individuals that they should prepare for a no deal Brexit. The political landscape is changing daily and whilst there is uncertainty over what will ultimately happen, it is clear that a no deal exit from the EU is no longer an unlikely scenario. What does this mean for our sector and how can we prepare for the coming year – for exhibitions already planned, for works committed to be loaned and borrowed between the UK and European countries? In his talk ‘Brexit, Cultural Heritage and Art Loans’ Geoffrey Bennet from the Institute of Art & Law suggested we approach Brexit with a sense of ‘constructive pessimism’. Everything might turn out okay, our worst fears not realised, but we must plan ahead.

Planning for Brexit: A Practical Overview

This session began with a presentation by David Rowland from the UK’s Department for Digital, Culture, Media and Sport (DCMS). It then moved into a panel discussion that looked at the implications of the UK’s exit from the European Union for Registrars, both in the UK and abroad. Bringing together a highly experienced panel of speakers, the session aimed to look at the current state of play and the practical steps that we can put in place to prepare for Brexit.

The view from the DCMS

David Rowland, (Head of EU exit and international strategy, Museums Team, DCMS) began by stating the importance of our sector: Museums, Heritage & Cultural Organisations are at the heart of the UK’s global influence and contribute significantly to tourism, material prosperity, enriching lives and strengthening global relations. He announced that a major nationwide festival showcasing the UK’s unique strengths in creativity and innovation will be held in 2022, backed by a £120 million government investment.

On Brexit, Rowland’s catchphrase throughout the session was ‘the government believes we can get a good deal,’ with the caveat, ‘but in the event of a no deal…’ The message from the DCMS is that the UK government wants a positive future relationship with the EU that will support the growth of museums and culture. They are committed to facilitating temporary movement of works, protection of cultural property and of continued cooperation with the EU. How will this work in practice?

In the event of a deal, (however that may look), there will be a transition period in which the government will plan for changes, implement new procedures and infrastructure and potentially build new trade relationships. For those working on loans and transit of works between the EU and UK, this means that initially nothing will change. In the event of a no deal, we leave the European Union on 29 March, 2019 and freedom of movement of goods and people will end with immediate effect. Customs, excise and VAT procedures to goods traded with the EU will be applied in broadly the same way that already applies for goods traded outside of the EU. In both no deal and deal scenarios, NIRU will be used to enable the temporary admission of cultural objects into the UK from EU countries in the same way that it is currently used for admissions from the rest of the world. It is likely that the both the UK and EU will agree to visa-free travel for tourists and business visitors. The government indemnity scheme will still apply. Further details are summarised at the end of this report in the Overview & Summary section.

Panel discussion

The panel discussed the issues raised by Rowland’s talk and possible scenarios. The most challenging issue will be the movement of works between the UK and Europe. With increases in costs and barriers for moving and lending of works due to changes in customs agreements, all agreed that in the event of a no deal there will be at least six months of disruption.

Image: Panel left to right: Anastasia Tennant, Arts Council England; Steve Gourley, Momart; Idoya Beitia, Royal Academy of Arts, UK; David Rowland, DCMS; Chair: Jane Knowles, The National Gallery, UK

Momart’s Steve Gourley explained that in a no deal scenario customs processes will increase from 50 to 260 million at the UK border. Unless the government puts more effective digital and physical measures in place, there will be long delays. Drivers may also need to obtain an International Driving Permit (IDP) to drive in the EU as UK licenses may no longer be valid. It is expected there will be a backlog of applications for permits which will increase delays.

The panel suggested avoiding the shipping of works between the EU and UK in the weeks immediately following March 29th. This may involve extensions to loan periods and storage of works which may in turn increase costs to the borrower.

Given the expected delay to shipping costs, increase in works imported to NIRU, and potential currency fluctuations, we should expect increased costs. We should build contingency into our budgets.

The overall message was ‘plan ahead’. In a sector where last minute changes to couriers and inclusion of works in exhibitions frequently happens, this will be a challenge, and ultimately require changes to the culture of the sector. We should consolidate shipments and couriers and where appropriate partner with other cultural organisations.

Pessimistic as the all of this sounds, Idoya Beitia from the Royal Academy of Arts urged everyone to not to be put off and to ‘try to be reasonable and keep communicating’ to colleagues and other organisations within the sector.

There are likely to be increased practicalities but collaboration is an essential and important part of our industry. Ultimately it is important to see the bigger picture and to continue the sharing of works between institutions in the UK and EU, making works accessible to greater audiences.

Overview & Summary

Movement of People

There is a willingness between the UK and EU to implement visa free travel for tourists and business visitors in a deal or no deal situation

In the event of a no deal Drivers may also need to obtain an International Driving Permit (IDP) to drive in the EU as UK licenses may no longer be valid.

Customs procedures

In the event of a deal:

There will be a transition period in which the government will plan for changes, implement new procedures and infrastructure and potentially build new trade relationships
The government anticipates the creation of a free trade area for goods with zero tariffs, deep regulatory and customs cooperation
NIRU will roll over in a deal (if no customs union) and no deal scenario and loans from EU will have to go onto NIRU

In the event of no deal:

UK businesses will have to apply customs, excise and VAT procedures to goods traded with the EU, in broadly the same way that already applies for goods traded outside of the EU
The EU would fall into rest of world customs system requiring temporary admission arrangements with VAT as close as possible to current system
NIRU will be used to enable the temporary admission of cultural objects into the UK from EU countries in the same way that it is currently used for admissions from the rest of the world
The UK would seek to join Common Transit Convention
Cultural objects beginning their journey in UK may require export licenses. Objects beginning their journey in EU and coming to the UK may need EU export licence
CITES – currently goods moving between UK and other member states don’t require checks, but post Brexit checks are likely to be required
Returned goods relief applies
Known Cargo, SPX won’t be recognised

What will stay the same?

Governing law will still apply
Government indemnity scheme will still apply
Immunity for seizure won’t be affected. If eligible apply

Planning for a no deal Brexit

Avoid shipping of works between the EU and UK in the weeks immediately following March 29. Due to increases in customs procedures and current lack of infrastructure there will be long delays at the border. In worst case scenarios, flights may be grounded
For works on loan due to return after Exit Day, gather alternative evidence to satisfy customs that goods were in free circulation, to help obtain import/export licence
Be prepared to extend loan periods and store works until disruption eases
Consolidate shipments and couriers as much as possible. Where applicable partner with other cultural organisations
Build contingency in budgets. Transit costs are likely to rise due to increases in transit times and there may also be currency fluctuations
Consider using alternative routes other than Dover. Are the resources you require (e.g. CITES checks) available at other ports?
Plan ahead, avoid changing things at last minute. Endeavour to change the culture of your organisation in this respect
Keep communicating with EU partners. There is a willingness to keep working with the UK
Be aware of the political situation, don’t be afraid of it, plan for it.
Don’t be put off – objects are going to be safe but expect delays for at least six months.
If have something major moving (e.g. large touring exhibitions, extremely rare and vauable works) after May 29, talk to DCMS and they will see if they can help
The UK will remain open for business, leisure and culture.