Thursday, 26 September 2019

Questions (10)

Pearse Doherty


10. Deputy Pearse Doherty asked the Minister for Finance the number of companies and economic operators that have applied for and received an economic operators registration and identification, EORI, number to date; and if he will make a statement on the matter. [39085/19]

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Oral answers (6 contributions) (Question to Finance)

As we approach 31 October, we know that thousands of businesses that rely on their trade with British businesses to stay open do not yet have the registration they need to continue to trade into the British market post Brexit. This serious issue is coming down the tracks. Our economy and our business sector need to be ready. How many companies and businesses have applied for and received an EORI number to date? How many companies that trade with Britain have yet to receive such a number and, therefore, will be unable to continue to engage in such trade in the event of a no-deal Brexit?

I am advised by Revenue that there have been more than 17,200 EORI registrations so far this year. There has been a significant increase in registrations since the start of the latest phase of Revenue's trader engagement programme, which commenced in July of this year.  Almost 5,000 businesses registered in August, with an additional 4,418 businesses having registered so far this month. This brings the total number of registrations to just over 57,000. The current phase of the trader engagement programme encompasses all businesses that traded with the UK in 2018 and the first half of 2019.  Such businesses were identified by Revenue through analysis of VAT information exchanges system returns. Each business that traded with the UK in 2018 or first half of 2019 has been written to and is being provided with suggestions regarding the steps it needs to take. Additional follow-up telephone contact is being made with businesses that have the largest volumes of trade with the UK, greater than €5,000, and those that trade most frequently with the UK, which would be at least quarterly. We believe there are approximately 44,000 such businesses. Revenue has directly contacted almost 25,000 of the 44,000 businesses and expects to contact the rest of them by the end of this month. Some 90% of the total value of imports from the UK in 2018 was carried out by businesses that now have an EORI number. Some 97% of the total value of exports to the UK in 2018 was carried out by businesses that now have an EORI number. The outstanding businesses that need to get a number, which comprise a low share of this country's total exports to the UK, or imports from the UK, are valuable companies that employ people. This is why the engagement programme will continue until the end of this month.

Those figures are quite scary. These companies trade with Britain and employ people through their trade with Britain. Their ability to retain their employees relies on the success or failure of this aspect of their business in many cases. The Minister told me three weeks ago that 40% of exporters did not have the necessary authorisation that will be the minimum requirement for businesses that wish to trade with or through the UK after Brexit. Given the Minister stated some 44,000 businesses do not yet have the authorisation they are required to get if they are to continue to trade with Britain after the end of next month, it is clear that a serious question needs to be answered. Are we failing to prepare ourselves for the emerging chaos related to Brexit? Are thousands of businesses and exporters sleepwalking into this chaos? The Minister mentioned that 25,000 of these 44,000 businesses have been directly contacted and that the other 19,000 will be contacted by Monday. Is that correct? Will the Minister reaffirm that? Does the contact in question take the form of a letter, or are follow-up conversations with these businesses taking place? We need to ramp this up dramatically.

It has been ramped up significantly. I have referred to the new programme that has been in place since the summer. The Deputy is correct that a company that does not have this number will face massive challenges in continuing its work in the event of a no-deal Brexit at the end of October. As I said in my initial reply, 90% of exports to the UK, by value, are covered by companies that have EORI numbers. The Deputy also asked about the further contact that will take place. A direct phone call will be made to each of the companies in question to ensure it is aware that it needs to get this number. If the UK becomes a third country, companies will need EORI numbers to trade with the UK. The Deputy is also correct that 19,000 companies are outstanding. I am informed by Revenue that phone calls will be made to them by the end of this month, which is next Monday.

I question the contention that it has been "ramped up significantly". I acknowledge the figures that have been provided by the Minister in respect of August. While there were 5,000 registrations that month, it is worrying that there has been a dip or a reduction in September, with just 4,418 registrations to date this month. I accept that the figures for the full month are likely to be different. It is worrying that three years after Brexit, some 19,000 companies have yet to be contacted directly by Revenue. We are a number of weeks out from Brexit now. These small companies, which might not conduct a large volume of trade with Britain but which provide employment associated with it, need to get registered and to hear a clear message from the Government. We encourage them to register without delay. Many of them are located close to the Border in areas that do not have the type of employment that is a feature of more urban areas. Some of them are located in my own county of Donegal, which has a high unemployment rate. Do the rest of the actions from the Government and Revenue amount to no more than a phone call? Will further conversations take place? Is there a process within Revenue and the Department to make sure the rest of these companies are registered?

I stated in my reply than an "additional" phone call will be made to these companies. They have already been written to by Revenue to tell them they need an EORI number. The programme I am referring to is the additional contact that is now taking place. Revenue is contacting these companies again on behalf of the Government to tell them they need an EORI number. When I have attended seminars to see how they work, I have seen how the kind of information that companies will need if the UK becomes a third country has been explained to them. As I have said, this is just the latest round of contact to be undertaken by Revenue. I will review where we are again in October - I have no doubt that Revenue will do likewise - to see if further action needs to be taken, for example by contacting these companies once more to ensure the basic requirement of an EORI number is in place.

Question No. 11 answered with Question No. 6.