Brexit Archives | Page 5 of 24

2021; a year of supply chain challenges

Dec 21, 2021 | Air, Brexit, China, EU, Metro, Road, Sea, Sea/Air, Supply Chain

All around the world, companies have been impacted by supply chain challenges in 2021. With the pandemic’s disruption exacerbated by ‘Black Swan events', from Brexit, to the Suez Canal blockage, we have been working tirelessly to help our customers overcome these challenges and share critical information, so that they are always informed of what lies ahead.

Ensuring the right product is available for delivery, to the right customer, at the right time, in the right quantity and in the right condition becomes increasingly difficult when supply chains are pressured and unforeseen events impact operations.

To keep our customers and followers informed during 2021 we have been approached for our opinions regularly by the trade and national press, contributed to countless articles and shared breaking supply chain news, guides and insights, including:

40 supply chain bulletins, to a combined audience of 32,000
200 news updates on our web site attracting >100K page views
1000+ social media posts, reaching over a quarter of a million users

Our first bulletin of 2021 highlighted early Brexit-related issues and outlined the rates, vessel space and equipment availability challenges that lay ahead.

A few bulletins in and we were considering the supply chain impact of the UK’s vaccine programme and, in preparation for the anticipated volume increases, were adding new personnel in key operational departments.

US port operations, particularly on the West Coast began to buckle under relentless volumes in early March, while European, North American and UK ports were anticipating a lull after the Evergreen EverGiven blocked the Suez Canal for six days, from the 23rd March.

Lockdowns continued to ripple across Asia from April and container equipment shortages really began to bite, exacerbated by the ‘Suez Effect’, driving desperate shippers to move urgent cargo to air freight, with massive rate increases impacting many trade lanes and Metro’s Sea/Air services proving very popular with increasing numbers of smarter shippers.

May; and the same week we’re urging shippers to start planning their Christmas shipping schedules, the key Chinese port of Yantian stops accepting containers, after a coronavirus outbreak in the port area. Within weeks and the impact of the port’s closure has spread way beyond southern China, with carriers recording their worst ever transit times and rates at historic highs - 1,000% higher than 2020!

News of the heavy goods vehicle (HGV) driver shortage made mainstream news in June and Yantian finally opened, though Ningbo was to close just weeks later, after a single port worker tested positive for COVID-19, contributing to further sea freight rates increases, pushing increasing quantities of ‘distressed’ ocean cargo to air freight.

Throughout the year, while air freight has been uncertain, it has proven stable in comparison to shipping, with airlines being reactive and agile, switching on flights quickly to meet demand, where they have perceived a reasonable return on the investment and we have been ready to add charter capacity, to ensure that our customers’ expectations are met and delivery deadlines achieved.

Into the 3rd quarter and vessel space and the container equipment crunch continues, with market demand exceeding supply and rates skyrocketing. HGV drivers are considering strikes for better conditions, while demand for haulage is more than twice the 2019 level and 70% of hauliers are concerned about EU border checks due to come into force at the beginning of next year.

Metro’s technology team, meanwhile, have been integrating HMRC’s Customs Declaration Service (CDS), which will serve as the UK’s single customs platform, with our market-leading MVT supply chain platform and the CuDoS system, which automates and submits customs declarations in line with HMRC and EU regimes.

Our team also supported the development and adoption of emerging technology, across the shipping industry, by participating in the successful testing of new e-Bill of Lading (eFBL) standards, with FIATA , the trade association for 40,000 freight forwarding and logistics firms in 150 countries.

The final quarter of 2021 and the HGV driver shortage is intensified by further losses to the retail sector, factories in China are forced to close, due to power shortages, container carrier reliability drops to all-time lows, with ports subsequently omitted, to try and restore schedules.

Passenger airlines finally begin to convert and reduce the number of aircraft operated in ‘preighter’ configurations and return to flying scheduled passenger services on European, transatlantic and long-haul routes.

As the year draws to a close, experts warn that the UK may run out of warehouse space, many shippers are still not ready for full UK border controls, manufacturing costs reach a three decade high, Omicron makes its debut and we share some Critical Christmas considerations.

This year we have also welcomed 60 new colleagues, to our Birmingham HQ and expanded our operations and platforms significantly, to ensure we deliver continued excellence, proactive communication and essential planning to customers. It’s what we do, to ensure we remain at the forefront of the industry, leading the evolution of freight and the dynamic solutions that benefit your supply chains.

However this year ends and whatever next year brings, you can rest assured that we will be available and ready to keep your supply chain running. Let’s keep talking and evolving as partners in an unpredictable environment and world. You are in safe hands!

Thank you for your support, Merry Christmas and Happy New Year.

Shippers risk falling foul of post-Brexit origin rules

Nov 10, 2021 | Brexit, Customs, EU, MVT, Technology

Many British companies trading with the EU are still failing to understand the extent of their legal obligations to comply with the origin rules of the EU-UK trade deal and could face disruptive enforcement action by customs authorities, when a ‘grace’ period for UK imports ends on the 1st January 2022.

Under the terms of the Trade and Cooperation Agreement that took effect at the start of the year, EU exporters can send goods to the UK tariff-free, but only if they can prove their products are sufficiently “made in the EU” to qualify for preferential access to the bloc’s single market.

These certification requirements on local content also apply to UK exporters wanting to send goods to the EU without incurring tariffs.

The “rules of origin certification process, was deemed so complex that EU and UK exporters were given a one-year grace period that reduced the required documentation, but this will expire on the 1st January 2022, with many companies facing a paperwork challenge.

UK importers found to have brought in goods tariff-free that are later found not to have complied with the rules of origin must pay full duties, and vice versa.

During the one-year grace period, British and EU companies have been allowed to certify their goods did qualify for zero-tariff access under the rules of origin, without supporting evidence from their suppliers.

Rules of origin and the way “originating content” is calculated vary from one product to another, but typically an item must be about 50% British or EU made in order to qualify for zero-tariff access under the terms of the trade deal.

To date, many British businesses have simply been attaching declarations stating they met the rules of origin to their invoices, even when they have no idea if the product is compliant or not.

Other companies have been working to better understand their origin situation, but with the potential for hundreds and thousands of components and complex and far-reaching tiers of supply, the situation is challenging.

The extent of any disruption from January will depend on how strictly EU and UK customs authorities carry out rules of origin checks. Inspections are expected to increase, particularly on the UK side, with more customs officers in place to ensure accuracy in terms of origin classification, as they will be collecting duty on behalf of the government rather than Brussels as was the case pre-Brexit.

If goods do not meet the rules of origin requirements or, more critically if origin cannot be proven, the importers will need to pay applicable Customs Duty.

The requirement to obtain preferential duty lies with the UK importer, who will need to provide either a statement of origin from the exporter or evidence they obtained about the originating status of the product.

Statement on origin that the product is originating made out by the exporter:

When exporting from the EU a statement of origin can be made out by any exporter where the value of the consignment is under €6,000 (£5,700). Above this, the EU exporter must have a Registered Exporter number (REX) and include it in the statement.

The statement on origin can be provided on any commercial document, describing the product in sufficient detail to enable its identification.

Importer’s knowledge that the product is originating:

‘Importers knowledge’ allows the importer to claim preferential tariff treatment based on evidence in their possession, that they obtained about the originating status of imported products. This evidence may be provided by the exporter or producer and provide evidence that the product qualifies as originating. As the importer is making a claim using their own knowledge, no statement on origin has to be provided by the exporter or producer.

If the UK exporter is subject to a request for verification and cannot provide evidence to show that the goods exported to the EU originate in the UK, the EU importer will be liable to pay the full rate of Customs Duty.

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, CuDoS simplifies compliant border processing, in either direction.

We simplify declaration submission and safeguard our customers EU supply chains from the potential fallout of easement and regime changes, which means that their EU/UK movements will not be interrupted when full UK/EU border controls are implemented on the 1st January 2022.

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

Brexit delay, dithering and duties: Metro has your back

Sep 23, 2021 | Brexit, Customs, EU, Metro, MVT, Supply Chain, Technology

To the consternation of many shippers, the Government is changing the start dates for new border checks and processes for imports and exports with the EU. The good news is that Metro’s experts can protect your supply chain from these changes and simplify customs compliance, with our intelligent, automated, digital solutions.

With three significant Brexit changes and developments already this month, it is clear why so many businesses trading with the EU are confused, uncertain and concerned about changing customs regimes, requirements and compliance.

Metro’s dedicated customs brokerage team, is one of the industry’s biggest, most experienced and best resourced. It is a unique repository for EU/UK Brexit expertise and a flagship for graduate professional development in a critical area.

Continuing investment in technology and the brokerage team has expanded the capacity of our groundbreaking Customs Document System - CuDoS - and the capability of the advisory, support and compliance resource we provide businesses that trade with the EU.

The proprietary CuDoS embraces proven, new and emerging technologies including optical character recognition, to convert documents into digital data. With automation technology, machine learning and artificial intelligence, to simplify and automate declarations, CuDoS is constantly adapting to ensure compliance with change UK/EU customs regimes.

CuDoS: 2021 Brexit stats:

74% of workflow automated
15,000 export declarations
6,000 Transit accompanying documents
12,000 import declarations
99% analog to digital accuracy
8 minutes = record declaration turnaround
85% of clearances turned around in under 2 hours

Importers pay more post-Brexit duties

UK importers have paid 42% more in customs duties since Brexit came into force on the 1st January, largely to the “rule of origin” tariff, which applies to goods imported from the EU which were originally made, or contain components made, outside of the EU.

UK importers are paying more duty and UK Customs is losing out on hundreds of millions of pounds, as importers fail to comply with the delayed declaration scheme set up to soften the impact of Brexit.

Delays cost business

Delayed customs declarations are not being converted into actual customs declarations and while some importers may be happy to import without declarations while they can avoid them, they do face the very real prospect of retrospective action and auditing by HMRC, to recover outstanding taxes and duties.

The decision by the UK government to further delay Brexit border controls has been criticised by trade associations who believe that if these controls were imposed on EU suppliers, it would cause friction that might encourage a negotiated relaxation in controls between the UK and the EU and is to the detriment of UK companies.

Under the revised timetable:

Pre-notification of Sanitary and Phytosanitary (SPS) goods, which were due to be introduced on 1st October 2021, will now be introduced on 1st January 2022.
Export Health Certificates, which were due to be introduced on 1st October 2021, will now be introduced on 1st July 2022.
Phytosanitary Certificates and physical checks on SPS goods at Border Control Posts, due to be introduced on 1st January 2022, will now be introduced on 1st July 2022.
Safety and Security declarations on imports will be required as of 1st July 2022 as opposed to 1st January 2022.
Exit safety and security declaration applies from the 1st October 2021. An EXS is required for a range of situations including, empty pallets, containers or a vehicle being moved under a transport contract and goods moving under transit.

Available, for the first time, 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, CudDoS simplifies compliant border processing, in either direction.

To discus your situation and to learn how we automate customs declarations for businesses of all sizes, please contact Elliot Carlile or Grant Liddell who can talk you through the options.

Post-Brexit update: Haulier and multimodal transport market latest

Jul 28, 2021 | Brexit, Road, Supply Chain

UK hauliers are under massive pressure, struggling to counter the border delays, increased administration and crippling driver shortages that have plagued the industry since Brexit and now, as they fear the full UK border checks due in January, drivers are planning a strike in August.

Surges in pandemic-driven demand are pushing hauliers to breaking point, with a study suggesting that 94% were seeing greater aftershocks from Brexit than expected and that 69% of UK haulage firms have been losing business because of post-Brexit regulation changes.

Lorry drivers in the UK are planning a nationwide strike over their working conditions, prompting warnings that this would cripple the country’s already creaking supply chains.

So far the “stay at home” action proposed for the 23rd August has attracted the support of 3,000 HGV drivers, however the Road Haulage Association (RHA) is urging drivers against taking action, saying it would make a “bad situation worse”.

The RHA is concerned that any action may heighten the effect of driver shortages, itself compounded by the ‘pingdemic’. Even the exemption of about 10,000 workers at 500 food distribution centres from quarantine does not appear to have offset the effect of the current shortage of an estimated 100,000 lorry drivers in the UK alone.

The 2021 Post-Brexit Hauliers Survey showed that more than half of haulage companies have already moved some operations to the EU and more would consider it in the future.

Over two thirds of haulage firms said they had already seen increased costs, with the rest expecting rises next year or in the near future. Many will have no choice but to pass these costs on, to keep their businesses viable.

This fallout has already being experienced in the container haulage market over recent weeks, with container transport becoming a premium product within the domestic transport environment, as salaries are increased to match those of retailers and commercial businesses outside of the industry.

Almost a third said they were avoiding the food and drinks sector because of increased checks and administration on some products and other sectors have been impacted, including livestock farming (25%), agricultural farming (25%), gardening supplies (19%) and retail (13%).

The impact of the driver shortage has been amplified by the fact that in the three months of 2021, the uplift in demand for haulage was more than twice what it was for the same period in 2019 and in April it was 120% higher than in 2019.

Despite the massive increases in demand for domestic movements, half said fewer exports were going to the EU, and half said fewer imports were coming in. However the main freight transport operators are not UK based but are European organisations so this may not reflect the real situation as they would not necessarily have been considered, just the impact on UK domiciled haulage companies.

Increased waiting times at the border was the biggest impact cited by respondents (81%), followed by increased time spent on admin (69%), and fewer exports and imports (56% and 50% respectively).

Other challenges included longer journey times to take alternative routes, higher tariffs, changing licensing and registration requirements, with only 6% of hauliers saying they had not been impacted.

Nearly seven out of ten haulage companies said they believed they would be negatively impacted by full border checks due to come into force at the beginning of next year and the British International Freight Association (BIFA) is encouraging businesses engaged in trade between the UK and EU, to make sure that they are fully prepared for the rule changes that will be even greater than those of January 2021. This is predominantly focused around the current temporary customs processes that will change permanently in 2022.

Road transport cannot be avoided, as part of the international movement of goods, with drivers critical for container movements, international and domestic haulage.

We work with a number of selected long-term haulage partners across the UK, to give us access to the widest pool of equipment and driver resource.

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 and means that our clients' EU supply chains will not be interrupted when full UK/EU border controls are implemented on the 1st January 2022.

To learn more, or to discuss your situation, please contact Elliot Carlile or Grant Liddell (or Simon Balfe who leads our UK multimodal transport operations) who can talk you through the options.