Wednesday, September 26, 2018

Freight and Road Haulage Groups React to Latest Brexit Pronouncements

No Deal Options Produce a Range of Reactions
Shipping News Feature
UK – The overwhelming feeling of anyone talking this week to representatives of the freight and logistics sector about their view of the government's pronouncements this week on the future of aviation and road haulage post Brexit should the result be a no-deal scenario, is that the industry emotions span a range, from frustration at the lack of progress, to incomprehension at the seeming inability of ministers to understand the complexities involved and hope that the worst may still be avoided.

The reality of the situation is simply that the UK appears to be no further forward in terms of actually knowing the essential parameters of trade after March 2019. Although comments from the leading industry Associations varied a little in tone, all acknowledged that there was still little in the way of positive instructions in the case of a no deal result, a situation many now consider a likely outcome following more unsuccessful talks in the past few days.

The Freight Transport Association (FTA) sounded a more positive tone with Pauline Bastidon, Head of European Policy, commenting:

"The publication of the government's No Deal Notices (around road haulage, aviation and the export and import of foods products) was overdue and is welcomed by FTA. These notices, while confirming what we already knew concerning the impact of a no-deal Brexit on freight transport and borders, will hopefully help traders and logistics companies prepare for the worst case scenario. They demonstrate that contingency agreements are needed to at least protect basic transport connectivity between the UK and the EU.

”The FTA recognises the Government's efforts to secure such agreements, either with the EU or with member states bi-laterally, and calls on EU-27 leaders and the European Commission to recognise the need for these contingency measures for freight transport, a sector which supports the entire economy."

The Road Haulage Association (RHA) however warned that these latest plans are simply too little, too late and expressed astonishment at the suggestion that shippers, and even hauliers, should consider alternative modes of transport to move goods between the UK and the EU in the event of a no-deal Brexit. RHA chief executive, Richard Burnett said:

“Goods are moved by road because of speed and efficiency, the UK relies on its incredibly efficient supply chain for consumers and businesses to get the things they need. This would very quickly put the manufacturing sector under severe pressure and the hauliers they rely on out of business. It’s essential that if there’s ‘no-deal’ it is accompanied with the already agreed implementation period to give businesses a chance to avoid chaos in the supply chain.”

Whilst the RHA boss also expressed concern over the lack of any mention of plans for freight movements between the UK and the Irish Republic, another key troubling point for hauliers is that of permits to drive in the EU. The RHA insists that the government needs to make clear if it will require EU hauliers to apply for ECMT permits to enter the UK if UK operators are forced to obtain ECMT permits to enter the EU.

A précis of the points made in Monday’s announcement as it affects road haulage operators might be summed up thus:

  • Drivers might need to swap UK CPC qualifications for their EU equivalents. This would presumably mean all future periodical examinations being undertaken when and where the EU insists.
  • There might be delays at Border points. The situation regarding Customs clearance seems to be as ill-defined as ever.
  • Foodstuffs might only be allowed to enter Europe and the UK via certain locations. There is talk of specific clearance points for these but, up to now, no news of where or how they will operate.
  • It seems there will be road haulage permits. As detailed in the government release it expects the DVSA to be taking permit applications from November 2018. Despite telling hauliers to apply at the first opportunity, it doesn’t yet know what exactly will be required whilst admitting there will not be enough available. The allocation will be based on several factors including: Intensity of use; Industrial sector in which the haulier operates; Vehicle emissions and Existing international business;

The paragraph which has, unsurprisingly, incensed hauliers instructs them to consider: alternative routes to move goods by roll-on-roll-off haulage; alternative modes of transportation, such as containerisation or unaccompanied trailers and ‘appropriate arrangements to allow for disruption to supply chains’.

The suggestion to move from accompanied to unaccompanied trailers or containers was described by one haulage professional with 50 years in the trade as “demonstrating the naivety of those making such a pronouncement - obviously someone who has no idea of the disparity between two systems which have evolved to perform subtly different tasks, both specifically designed for their purpose.”

For its part the British International Freight Association (BIFA) was keen to stress that the latest government pronouncements apply only to a no-deal scenario, a situation the organisation was still hopeful could be avoided. The BIFA statement referred to paragraphs 2 and 3 of Article 50 which indicate that a trade deal, the key issue here, can in fact be negotiated after Britain leaves in March 2019.

In the intervening period, as written in the Article, there would be a fall-back position relying on current EU systems and standards. BIFA says the UK has produced a confused message to Europe as to what exactly it expects from the departure, exacerbated by the terms of the Chequers agreement, a situation which initially caused a degree of animosity, somewhat redeemed with the subsequent statement issued by the EU from Salzburg, couched as it was in conciliatory terms.

Photo: A no-deal result will likely produce an upsurge in unaccompanied trailers and see a swing toward currently lesser used UK ports on North Sea coast with RoRo capabilities.