Business, Forwarding, Freight News, Logistics

UK customs plans will take a decade to realise, says Clecat

[ October 18, 2018   //   ]

UK plans for a Facilitated Customs Arrangement (FCA) could take up to a decade to put into practice and are not a realistic solution to the problems posed by Brexit, says forwarder’s group Clecat in a new position paper published on 16 October.

The group is urging Brexit negotiators to prevent a no-deal situation “at all costs” in a position paper on the future economic partnership between the EU and UK published on 16 October.

It says that an agreement over the withdrawal “including a reasonable transitional period, a trade agreement, certain conventions (like the Common Transit Convention and/or a security agreement) and other arrangements or facilitations as they currently exist, would be the most realistic way forward.

Director general Nicolette van der Jagt, said that while UK plans for a Facilitated Customs Arrangement (FCA) might be worth further exploring, “it needs more detail and therefore more time. The proposed FCA leaves so many questions unanswered, that we fear that it will not be possible to apply it in practice by the end of the transitional period and, most importantly, it increases the chance of …a no-deal situation.”

According to the paper, the FCA plans: “leaves out several critical aspects and at the same time introduces aspects with which no trader, customs service provider or (customs) authority is familiar.”

The concept of the FCA and ideas like a free trade area or a common rule book “might be good solutions which may be worth exploring, but many aspects of those proposals need far more detail.”

A concept like the FCA “would require five to ten years before it can be applied in practice,” the paper asserts.

The only realistic scenario is a regular EU external trade environment, a reasonable transitional period, a trade agreement with customs conventions like Common Transit and/or a security agreement) and other arrangements or facilitations as they currently exist, “would be the most realistic and would limit damage for both economies”.

However, working towards this situation would still require thousands of new customs experts need to be recruited and trained, IT systems would need to be able to cope with millions of extra declarations and notifications, thousands of new authorisations acquired and companies that have never dealt with extra-EU trade need to be made aware of procedures, along with the right infrastructure at ports, airports and other corridors.

It says while it is not impossible to achieve this there needs to be an understanding that a Brexit with a regular trade environment, which while it may sound negative is actually the most realistic and pragmatic approach at this stage of the withdrawal.

The technical notices published by the UK notices on what would happen in a no deal situation have though created unnecessary confusion, says Clecat.

It also says that the time frame provided in the Withdrawal Agreement for a transitional period from March 2019 to December 2020 is very short. (Reports of Brexit negotiations in mid-October suggested that this could be extended.)

Extending the transitional period or a second transitional period, would

provide several benefits, Clecat considers.

As acquiring customs authorisations to enable almost frictionless border processes can be a lengthy process, Clecat strongly urges the authorities involved  to ensure that applications are processed quickly, possibly through single contact points.

Clecat senior manager Dominique Willems added: “Modern Customs legislation and technology provides for numerous simplifications and facilitations through which goods can move across borders unhindered. All the procedures, systems and legislation are already in place to handle huge volumes of goods coming from for example China or the US. Preparing for an economic partnership between the EU and UK with which trade is already familiar, would still be quite a challenge in terms of capacity, but at least we could start preparing for such a situation today. Exploration for further simplification is still very much appreciated, but it requires a more stable environment, clarity and time.”


Tags: ,