Tuesday, July 14, 2020

Logistics Groups React to Latest UK Government Pronouncements on Transition Through Brexit

EU Border Report - Some Progress Made but Could Do Better
Shipping News Feature

UK – Logistics groups of every hue reacted rapidly to the latest UK government plans for the proposed Border Operating Model that will take effect from the end of the Transition Period. The reaction was largely a metaphorical pat on the head rather than a slap on the back. When a freight trade organisation says it is ' keeping its fingers crossed' that hardly shouts inspired confidence.

Whilst there were muted greetings for the revelations, all bodies were concerned as to whether the measures required could be put in place in time to ensure a smooth transition. Up first was Robert Keen, Director General of the British International Freight Association (BIFA) who said that the information contained in the documentation suggests a more cohesive approach to managing the UK’s trade flows and regulatory procedures with the EU, continuing:

"Today’s announcement makes it very clear that importers/exporters, in particular those that have previously only traded with the EU, really need to consider what they need to do, collect data, appoint someone to act on their behalf and give the intermediary the necessary information.

“Government appears to have woken up to the fact that Customs procedures are complicated and are not simply about ticking a few boxes. Perhaps it is evidence that the freight forwarding sector, which manages many of those customs procedures, is finally getting some welcome recognition from government for its crucial role in the UK’s international trade.

“However, we remain concerned that the information delivered today was not made available to trade earlier and that some of the details appear to be at the conceptual stage, with detail lacking. This will make the time frames for consultation and then devising the appropriate IT systems extremely challenging.

“Even with a phased transition that comes with the new Border Operating Model, and yesterday’s commitment to a further £705 million investment to fund new infrastructure, jobs and technology at the GB-EU border, we remain concerned on a number of issues, including the recruitment of staff qualified and experienced in Customs procedures, and the lack of available time to train newcomers, which is not a five-minute job.”

Over at the Freight Transport Association (FTA) Head of International Policy Alex Veitch also wondered if there was time to ‘get the job done’, but was pleased that some clarity was starting to be seen, commenting:

“Logistics as an industry is highly flexible and can adapt quickly to changing circumstances, as we have seen throughout the Covid-19 crisis, but nevertheless it is good to have confirmation of a large proportion of the detail of how goods are expected to move between the UK and EU from the start of next year.

”We are advising our members to do all they can to get Brexit ready, for example adapting their systems to produce the right border documentation, working with customers to understand the requirements for each party in the supply chain, and enrolling in trusted trader schemes like CTC Transit. These will all be needed whether or not the UK government strikes a deal with the EU.

“However, logistics businesses are also urging the government to continue pursuing a deal with their EU counterparts as an urgent priority. This will to make it simpler to trade, ensure trucks and planes from the UK have access to the EU, and minimise economic disruption. Logistics is committed to making the new relationship with the EU work, we now need government to do the same and strike a deal.”

The Road Haulage Association (RHA) said it was concerned that Government’s latest Brexit campaign ‘The UK's new start: let's get going’ fails to address the magnitude of what is needed to manage customs complexities as businesses race to ensure their essential ‘border readiness’ ahead of post-transition trading.

As with the other industry representatives the RHA points out UK businesses will have to employ the services of 50,000 customs intermediaries to handle the complex new processes allowing them to move goods across borders and the recruitment of this team alone will be a long process as will their necessary training, with RHA chief executive, Richard Burnett concluding:

“This campaign will prepare Britain for the ‘significant opportunities’ of Brexit, but I am completely at a loss to understand how this framework can be achieved by 1 January 2021. Time is running out and it’s still not clear if there will be the sufficient support needed to keep the cross-border supply chains moving. There remains a vast amount of work to be done and the timescales are extremely short.”

The 206 page government policy paper on the Border Operating Model can be downloaded using the link in the first paragraph. Much of the relevant information was included in our piece last week but the new document goes over the whole situation. The logisticians concerns however are valid, if it takes that long to read a government policy paper, how long will it take to train a customs entry specialist to a level where those new declarations are flowing freely leaving trade unhindered?

Those of us old enough to remember the situation before entry into the Common Market will know that it took years before the relevant authorities did what had been promised. Customs paperwork reduced, but hung on for all that time going completely against the principal advantages of a free market.

The U turn which is Brexit is likely to make for a much harder return journey for shippers, both in Britain and the EU, in terms of delays unless the negotiators wake up to the realities and a deal is done.