Brexit Archives | Page 3 of 24

UK inches towards potential EU trade war – impact on European logistics

May 19, 2022 | Brexit, Customs, EU

After the PM’s trip to Northern Ireland this week failed to trigger any progress in the dead-locked political situation, the government has announced plans to table legislation that will scrap parts of the Northern Ireland protocol, in spite of fears that it could initiate a trade war with the EU.

The political parties in Stormont all criticised the prime minister after a series of meetings on Monday and the Democratic Unionist Party (DUP) has withheld its support until the government takes "decisive action" on post-Brexit trade arrangements.

Mr Johnson said a "legislative solution" was needed and the Foreign Secretary has now confirmed that the government would, in the coming weeks, introduce legislation to strip away parts of the protocol to enable easier trade, though it would have to go through parliament, which could take months.

Brexit opportunities minister, Jacob Rees-Mogg claimed last week that the EU “wants to make the UK feel bad about having left the European Union”, but doubted the EU would retaliate with something as severe as a trade war, saying it would be a “pretty silly” thing to do.

While the former Brexit minister David Frost has said the UK may face EU retaliation, although it would be disproportionate to the trade involved and logic may yet prevail, but if it does happen, “we should not fear it.”

However, Britain’s former ambassador to the EU, Sir Ivan Rogers, has warned there’s a severe risk that we are heading into a trade war and that the threatened legislation wouldn’t even have to come into force for the EU to think that it was entitled to retaliate.

While many hope that the EU would launch lengthy legal proceedings that could result in the UK being fined, the real fear is they may terminate the trade deal with the UK and impose tariffs on all British exports to the bloc.

The imposition of tariffs could be triggered quite quickly and the EU could also increase border checks, to disrupt Channel trade and even if the UK does not retaliate, there could be shortages and price rises, which would be deeply unpopular, at a time of rampant inflation, a cost of living crisis and looming recession.

The EU has already ejected the UK from its flagship Horizon research programme because it no longer trusts the government and could take similar steps in other areas.

Let’s hope the politicians can agree a sensible solution, quickly, encompassing all stakeholders and rather than confuse future trade within Europe, simplify it. We are closely monitoring the situation and the impact and ‘fallout’ of any negative outcome over coming weeks and months, and possibly beyond.

Metro are at the forefront of UK/EU customs brokerage solutions, with our automated CuDoS declaration platform and a dedicated team of 40 customs experts, which means we are well positioned to react swiftly to any changes in the UK’s trading relationship with the EU.

Automating and submitting customs declarations and associated paperwork, CuDoS simplifies compliant border processing, in either direction.

To learn how we can simplify and automate customs declarations for your businesses, please contact Elliot Carlile to talk through the options.

Importers from EU risking fines and worse

May 6, 2022 | Brexit, Customs, Supply Chain

The EU introduced full import controls at the end of the Brexit transition period, while the UK government has now delayed full import control four times, with concerns rising that UK importers are not making appropriate declarations, risking fines and penalties.

The UK government’s own Public Accounts Committee officials warned months ago that much remains to be done to introduce import controls and the government’s aspiration to create the most effective border in the world by 2025 is a noteworthy ambition, but it is optimistic, given where things stand today.

Ambition is usually good – but it needs to be deliverable.

The decision to defer food checks and security declarations due to come into force in July is raising fears that more import shipments will not be properly declared by importers, or subject to HMRC scrutiny.

The Goods Vehicle Movement Service (GVMS) is HMRC’s IT platform for moving goods into or out of Northern Ireland and Great Britain, but its rollout, adoption and operation has been fraught with issues for UK border officials. Concerns are mounting that import shipments are simply bypassing the system’s oversight and weaknesses will continue to be exploited until import safety and security declarations are introduced, which will not be before the end of next year.

Without safety and security declarations being imposed on the 1st July, Border Force officials cannot see what needs to be stopped and which arrivals are without pre-lodged declarations, which means vehicles coming off the ferry could be carrying any number of undeclared shipments.

Reports in the trade press accuse some hauliers of taking opportunistic shortcuts without understanding the repercussions that may follow and until GVMS is operating effectively there may be little chance to restore order.

While deferred entries ended last June there are suggestions that some hauliers still use the entry in declarant’s record (EIDR) shortcut for GVMS entries, with others ticking the ’empty vehicle’ option for GB inbound.

Part of the problem is that a goods movement reference can be finalised via GVMS with the entry of just one ‘movement, or employer, reference number (MRN/ ERN), running the risk that hauliers could avoid declaring all shipments onboard a truck.

HMRC told the press: “HMRC has a strong track record in tackling all kinds of avoidance, evasion and non-compliance, and we will continue to employ an end-to-end approach to tackling customs risks.”

We always saw the EIDR delayed declaration scheme process as fundamentally risky, which is why none of our importers adopted it, opting instead for full clearance and consequently no liability to HMRC.

It is now clear that there will be issues arising from HMRC’s border ‘easements’ and potential pitfalls, that we are pleased our customers have avoided.

Our CuDoS customs brokerage platform is optimised continuously, in line with the regimes in force on both sides of the Channel, automating and submitting customs declarations, for simple and compliant border processing in either direction.

To learn more and to discuss your trading objectives, please contact Elliot Carlile who can talk you through the options.

EU/UK border controls set for July put back again

May 6, 2022 | Brexit, Customs, Supply Chain

The UK government has again delayed the introduction of further border controls on goods from the EU, due for implementation from July, pushing them back until the end of 2023, suggesting it did not want to add more costs at a time of fast-rising inflation.

New import controls, including on EU food products, due to begin in July of this year, have been put back for a fourth time, with the government saying "it would be wrong to impose new administrative burdens and risk disruption at ports" at a time of higher costs due to the war in Ukraine and rising energy prices.

The government said. “British businesses and people going about their daily lives are being hit by rising costs caused by Russia’s war in Ukraine and in energy prices. It would therefore be wrong to impose new administrative burdens and risk disruption at ports and to supply chains at this point. The remaining import controls on EU goods will no longer be introduced this year - saving British businesses up to £1 billion in annual costs.”

Port operators, many of whom have already built border control posts, have reacted angrily, saying the government’s announcement is a major policy change and that the facilities could become redundant, wasting millions of pounds of public and private funding.

Specifically, the following controls which were planned for introduction from July 2022 will now not be introduced:

• Safety and security declarations on EU imports

• Health certification and SPS checks for EU imports

• Prohibitions and restrictions on the import of chilled meats from the EU

• Sanitary and Phytosanitary (SPS) checks on EU imports currently at destination to be moved to Border Control Post (BCP)

Current import controls on EU goods will stay in place and traders will continue to move their goods from the EU to GB as they do now:

• Import Customs Declaration

• GVMS declaration

• Pre-notification into IPAFFS for POAP, Live animals, Plant Products

The government’s statement confirmed that no further import controls on EU goods will be introduced this year and that businesses can stop their preparations for July now. In many ways this can be considered a good thing that is positive for business; in other ways just further delays that will occur at some point that will need to be addressed.

They will now publish a Target Operating Model in the Autumn that will set out the new regime of border import controls and will target the end of 2023 as the revised introduction date for the control’s regime.

Metro are at the forefront of delivering EU customs brokerage solutions, with our automated CuDoS declaration platform and a dedicated team of over 40 customs experts.

Now available to new customers, our CuDoS customs brokerage platform is optimised continuously, in line with the regimes in force on both sides of the Channel.

Automating and submitting customs declarations and associated paperwork, CuDoS simplifies compliant border processing, in either direction.

To discuss your situation and to learn how we automate customs declarations for businesses of all sizes, please contact Elliot Carlile to talk through the options.

Third of businesses not prepared for EU customs changes

Mar 10, 2022 | Brexit, Customs, EU, MVT

With the multiple transitions, extensions and grace periods granted by the government, to minimise the impact on supply chains, of cutting trade ties between the UK and EU, 30% of businesses were still 'not at all prepared' for customs controls, when they were reintroduced in January.

Through 2021, for 12 months after the UK left the European Union, companies importing and exporting goods between the UK and EU have not needed to make full customs declarations, but on the 1st January 2022 full border controls were imposed and shippers are required to submit full declarations, confirm goods origins, and pay relevant duties and taxes.

According to a recent survey by the Federation of Small Businesses (FSB), 25% of UK importers are not prepared for these changes, while a further 33% said they were totally unaware of the new rules, until approached for the survey.

And it’s not just small businesses that are unprepared, figures from the Institute of Directors (IoD) suggest that 30% of firms were “not at all prepared” for the changes.

The Office for National Statistics (ONS) asked import-exporters if they had made changes to their supply chains in line with the end of the EU transition period. Just 7.7% responded yes and 60.9% said no.

Though only a small proportion of businesses have had to change their supply chains, nearly 60% have incurred greater costs since Brexit, of which the biggest outlays have been due to transport (24.7%) and more red tape (19.2%). Few businesses said increases were caused by the cost of importing goods and services (13%) and tariffs (10.8%).

The British Chambers of Commerce, says 2021 has been “challenging” in terms of cross-border trade with the EU, but that the steep fall in volumes at the beginning of the year has recovered to an extent. However, they add, there are clear points of friction around VAT, rules of origin, customs rules and paperwork and labour mobility. In the second quarter of last year, 28% of BCC members reported expectations of reduced export revenues – a historically high number.

It is hard to disentangle the effects of Brexit from those of the pandemic and the export of goods is very different from that of services so it is helpful to look at them separately. The ONS found that among all exporting businesses, 47.9% of firms that only export goods said the end of the EU transition period was their main challenge, which compares to just 9.3% for businesses that export services.

However, the effect of Brexit is weighing on manufacturing, according to the UK Manufacturing PMI survey, which found that “severely stretched supply chains disrupted production schedules and have driven up input prices to the greatest extent in the 30-year survey history”. Around 75% of manufacturers reported a rise and less than 1% a fall.

Brexit and logistical disruptions, that restrict opportunities to manage inbound supply chains or expand into overseas markets, are challenges that Metro help our customers overcome, with our automated customs platform, CuDoS, dedicated freight management and outsourcing teams and our multi-award winning MVT supply chain platform.

We have prepared our customers, to absorb any impact of Brexit and increased our customs brokerage team to support smaller companies, whose general unpreparedness would lead to trouble with HMRC and extra costs from non-compliance.

Metro empower manufacturers and importers with the guidance and support they need to successfully navigate global trade, however complex or changing things may become.