The UK and EU trade negotiations are currently underway. If the UK and the EU have not agreed a deal by 31 December 2020, then trade between the UK and the EU will default to World Trade Organisation (WTO) terms starting on 1 January 2021.
While the official deadline is 31 December, the EU have warned that negotiations will need to be completed by the end of October to give national governments and parliaments sufficient time to ratify the deal.
Several rounds of negotiations have taken place, and more are expected throughout the summer. The negotiations have been impacted by COVID-19 pandemic which delayed progress and initially prevented negotiating teams from meeting face-to-face. There has been a lot of progress in technical areas but whilst the political issues remain they prevent an agreement being reached. Whilst there is hope that an agreement can be reached between the two sides, the risks of a no-deal are stubbornly high. Both the EU and UK have been stepping up information campaigns to encourage business to prepare for the end of the transition period. We recommend that you start preparing now as the end of the transition period will result in significant changes whether there is a deal or no deal. The UK has created an information site here and the EU has further resources here.
The AA will continue to keep abreast of developments.