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Customs brokers dump clients as trade struggles to cope with Brexit aftermath

[ February 9, 2021   //   ]

Long term smaller customers are being discarded by their customs brokers in favour of new, larger clients as the industry grapples with a severe shortage of capacity, a meeting of the EU Goods Sub-Committee was told on 8 February.

Independent customs expert Anna Jerzewska told the meeting that while there was some capacity still available in the industry, potential customers were having to look hard for it.

She added that there was also a shortage of people that could give companies advice on customs matters and that some of those attempting to do so were giving bad or incorrect information.

Director general of the Automated Customs and International Trade Association, Des Hiscock, also confirmed that there was a shortage of advisory expertise, while brokers were reluctant to take on firms that carried out only a few clearances a year.

Traders are struggling to cope with rules of origin, the trade experts told the Committee. Anna Jerzewska said that currently available government guidance was “not fit for purpose”, especially with the current shortage of customs brokers. HMRC did not have the capacity to offer traders guidance, she added.

Des Hiscock said that the documentary requirements for rules of origin varied from country to country. He added: “It’s not as easy as filling out a couple of forms – and the potential sanctions if you misinterpret the rules are significant.” He said that his company was currently receiving 100 calls a week on the subject. Nor was it the case that companies could “buy a piece of software” that would instantly solve the problem.

Alex Veitch said that most Logistics UK members had struggled to get support, especially advisory help.

The witnesses reported few problems with customs IT systems as such, with Chief, GVMS, Check and HGV and the Trader Support Service so far able to cope with the volume of transactions being pushed through them. However, they were concerned at how eventual Chief successor, CDS would cope when it started to accept large numbers of Northern Ireland transactions from early March.

There are also concerns about how Customs and its systems will cope when large numbers of sanitary and phytosanitary (SPS) checks are thrust upon it from July. Hiscock said: “My membership has a real fear that they will not be ready.” SPS checks are much more time-consuming than customs checks, most of which are only a formality, he said.

Asked whether the customs problems had led to a shortage of trucks or an increase in the number of trucks returning from the UK empty to the Continent, Logistics UK general manager of public policy, Alex Veitch said that little information was currently available but what there was suggested that the proportion of empties had increased from its normal 30% to about 55%. Logistics UK was however carrying out a survey which would shortly give much more accurate data, he added.

Groupage cargoes posed particular challenges, the panel of experts said. Hiscock said that there could be a requirement for customs controlled warehouses where road groupage shipments could be handled.

Veitch added that the imposition of cabotage rules could have serious implications for transporters of stage sets and similar for touring musicians as well as sporting events. Logistics UK would support a negotiated agreement with the EU. He would also be in favour of liberalisations of the fifth freedom rules for UK airlines moving freight in the EU.

He also called for the current grace periods for food and parcels moving between Great Britain and Northern Ireland to be extended. He suggested that there could be a trusted trader system both for food and parcels carriers.