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Trading with Europe: A Guide for the Fashion Industry
TRADING WITH EUROPE: A GUIDE FOR THE FASHION INDUSTRY
On Wednesday 22nd January, Alinea hosted a seminar for fashion industry professionals, in association with Lone Design Club. Lone Design Club support independent, sustainable fashion by staging pop up boutiques in London, Milan and Shanghai.
Europe is an epicentre of emerging fashion and has traditionally home to the world's most iconic designers, including Thomas Burberry, Coco Chanel, Yves St Laurent, Gianno Versace and Valentino Garavani. The European Commission cites that fashion and the high-end industries are part of European cultural heritage, and that the culture and creative industries have much to contribute to the growth of manufacturing in Europe. The UK fashion sector is worth £9.1billion in exports to the UK economy, of which 74%, totalling £6.7billion, is exported to the EU. The UK employs 5 million people within the fashion sector, and the fashion industry contributes an overall £32billion to the UK economy. (Source: British Fashion Council 2020, The UK Fashion and Textile Industry 2020).
Several of the intellectual property protections that the EU has implemented can historically be traced back to the protection of textile markets, to protect regional innovations which were being developed within the early textile industries.
Interestingly,82% of the fashion industry is lead by micro-businesses and SMEs - in a sector which combines creativity, popular culture and industry on a grand scale. On the agenda of the seminar was the political and economic landscape; business preparation for change; communicating across your supply chain, and opportunities for growth.
The topics that we discussed included:
1.) The Convention on International Trade in Endangered Species of Wild Flora and Fauna
2.) The Common Transit Convention
3.) Currency Risk
4.) Distribution agreements - highlighting the prevalence of Selective Distribution Agreements in the luxury and sustainable fashion sector
5.) Export Paperwork
6.) Export Tariffs
8.) Import tariffs
9.) Intellectual property
11.) Outward processing relief
14.) Transitional simplification procedures
15.) VAT (for importing and exporting)
Following Britain formally leaving the EU on the 31st January 2020, a transitional phase will occur until 31st December 2020 whilst the prime minister negotiates a trade deal with the European Commission. Following this, if an agreement has not been reached, Temporary Trading Tariffs will apply for 12 months. HMRC has released details of how to prepare for an EU exit in the event of a no-deal, Alinea Law has collated relevant information and legislation which is relevant for the fashion industry and prepared a guide to prepare companies to effectively communicate around, and budget for any contingencies in the event of a no-deal Brexit.
Please contact Alinea if you require consultation on any of the above topics.