The UK has long been the most important market for the Irish farm and food sector. With Brexit, while diversification is important, it is still vital Irish companies can ensure fast, steady delivery into Britain. One method to help minimise customs delays is authorised economic operator (AEO) certification. While not the solution for every company, it can provide some real benefits.
The main advantage of AEO is priority treatment at physical checks. It’s a security standard, which was introduced by the World Customs Organisation in 2008. The concept was to create a set of internationally recognised safety and security standards that companies could implement in their facilities so as to minimise customs delays. With the help of Enterprise Ireland, bacon producer Oakpark Foods is in the process of acquiring this certification. Financial Controller Danny Madigan said it is crucial: “Considering the nature of our product, which is chilled, delays in the supply chain could have detrimental effects on shelf life and product quality”.
Oakpark Foods was originally a bacon curing house and moved into sliced retail bacon packs in 2008. As part of its diversification efforts, the company recently opened a new facility in Clonmel, Co. Tipperary, which produces white meat products. Currently when exporting to Britain, only one docket is required but after Brexit: “You’ll have to talk to Irish Revenue and Inland Revenue [UK] and make declarations on both sides”. For Oakpark, it is not enough for the freight company they are using to have AEO status: “It is the responsibility of the company to ensure that the correct safeguards and checks have been carried out before the product leaves the site to ensure it has not been tampered with in any way. AEO-certified companies need to have these safeguards in place, which is why there are fewer checks required at port level”.
The steps to gaining AEO status
To become an AEO, a self-assessment questionnaire (SAQ) is required by the Revenue Commissioners. Revenue then carries out an onsite assessment within 120 days, after which, AEO status will either be granted or rejected. For Oakpark, there is a specific business case for getting AEO status: “We basically weighed up the effects that delays in our supply chain would have on our products and decided that everything that could be done to avoid this should be explored”.
Support from Enterprise Ireland
Danny said Enterprise Ireland is providing extensive support: “They’ve supplied R&D supports to help us diversify into other markets and improve our product. They’ve provided advice and guidance through their Brexit Act On Initiative, which formed the cornerstone on which our Brexit plan was formulated. We’re also hoping to complete a Lean programme in the coming months, which will help the company to become more competitive, and alleviate the extra costs that will invariably be incurred as a direct result of Brexit”. The Brexit: Act On Initiative is broken down into three categories: strategic sourcing, which reviewed Oakpark’s supply chain and identified strengths and weaknesses, customs and logistics, which identified the pressing need to register as an AEO, and, thirdly, financial and currency management. Help determine the case for AEO in your business through the support of Enterprise Ireland’s Brexit: Act On Initiative.