Monday, July 30, 2018

Road Haulage Body Poses the Supply Chain Questions on Brexit as the Clock Runs Down

Truck Permits, Border Controls, Customs Clearance Points - All Need Answers
Shipping News Feature
UK – As anyone in the country knows now, there is nothing simple about leaving the European Union. Whether you believe that EU representatives are making the whole process as difficult as possible for fear the entire institution might collapse, with other member nations seeking deals similar to Britain's, or just that the UK's politicians simply lack the backbone and the nous to get a decent deal, Brexit has turned into an administrative nightmare with still no clear end in sight, satisfactory or otherwise.

With the ‘no deal is better than a bad deal’ mantra repeated once again in the House of Commons last week comes a considered view from the trucking community in the form of an analysis by the Road Haulage Association (RHA) whose 7,000+ members operate nearly 50% of the UK’s 496,000 lorry fleet, and their view certainly doesn’t commit to that position.

The RHA says it is time for a reality check with the concept of frictionless borders the keystone to the whole affair when it comes to trade. It believes customs controls and the controlling of lorry movements are the key issues for maintaining a satisfactory supply chain and opines that if there is no deal, and customs controls are established for UK hauliers at every European border, the knock-on effect will be crippling. According to RHA chief Executive Richard Burnett:

“The Dover Strait handles 10,000 lorries each day and processing them through the port is currently seamless. The stark reality is that if customs controls are put in place, it will take an average of about 45 minutes to process one truck on both sides of the channel. If that happens then the queues of HGVs in Kent will make the jams seen in the summer of 2015 appear as little more than waiting for the traffic lights to change.”

The British position, as stated by Transport Secretary Chris Grayling, is that imposing customs checks at Dover and other British bottlenecks simply won’t happen (‘it is utterly unrealistic’) and the government will not introduce these, but, as the RHA points out, what about the French? If the EU introduces customs processes in place in March 2019 to check all lorries traveling between the UK and the EU, hauliers will be faced with the prospect of coming over to and from the UK and having to wait, the RHA believes for days or even weeks, before they can return home, making the transit unworkable.

Customs difficulties are only one aspect which needs addressing in the 6 months left before the UK is scheduled to quit Europe. 50% of food consumed in the UK’s comes from around the world, of which 70% comes from the EU, this traffic is largely unsuited to unaccompanied trailers, if the UK had anywhere to park them, and much of this traffic is refrigerated. This could make fruits, vegetables etc. which we now take for granted as everyday items, at best more expensive, at worst unobtainable.

Permits to operate the trade are another bone of contention. Any HGV, i.e. over 3.5 tonnes, requires a European Conference of Ministers of Transport (ECMT) permit to operate on international journeys where other arrangements do not exist. This would clearly be the case when the current licences that permit inter community travel cease to be valid when the UK leaves the EU. ECMT permits are valid for one calendar year and allow an unlimited number of journeys within that period. The UK does not currently issue monthly permits. Permits may be transferred between vehicles but are valid for only one vehicle at a time. The permit and a log book must be kept on board the lorry for the whole journey.

For UK operators these ECMT permits are limited to less than 5% of the number of licences currently issued. If that scenario becomes reality, most UK operators will unable to go and get the goods themselves. Without special arrangements EU operators will also need to use ECMT permits. The RHA says the change will result in many British hauliers simply being forced out of business as there are limited numbers of ECMT permits allowed to be issued by the UK, if every permit was issued to a Euro VI lorry no more than 1,224 UK lorries could work on UK – EU trade. (this is less than 5% the current number of Community Licences used by UK international operators now).

Not only UK hauliers would suffer however as EU lorries will require ECMT permits to enter or transit through the UK and these too are limited by ECMT quota. The lack of clarity over how this will work out is something which needs resolution immediately. In the past year 4.8 million driver-accompanied freight vehicles moved between the UK and Europe with around 4 million of these being by ferry through Dover or by shuttle through the Channel Tunnel.

According to HMRC, around 99% of these movements did not require any customs clearance process at all, the lorries can simply drive straight onto the road network on arrival. A solution which maintains the supply chain in a seamless manner is absolutely crucial, particularly when it comes to ensuring the flow of foodstuffs and other essentials is unaffected. Customs controls do not need to take place at the point of import and to even suggest it goes to demonstrate the inability of some to understand the problems faced.