Hard borders, soft borders, cliff edge deals and a new customs union slammed by the Freight Transport Association as not fit for purpose: the aftermath of Brexit and the uncertainty it brings to UK businesses seems to be highlighted in news stories every day. As a worldwide freight forwarding company, we are seeing first-hand how this insecurity is affecting our clients. So for those trading with the EU, here’s what we know about Brexit and the HMRC’s new customs system so far…

Since Article 50 was triggered earlier this year, businesses have been flooded with stories of how the negotiations will affect EU trade. While members of the Leave team are keen to pursue trade opportunities outside of Europe, Remainers can’t be blamed for asking what now? Despite the uncertainty, HMRC reported that one year on from the referendum, in June this year UK exports were up 15%, and imports were up 4% compared to last year (see full stats here).

Politically, negotiations are not progressing well it seems, with EU chief negotiator Michel Barnier reportedly saying negotiations are “quite far” away from being able to begin talks on future trade agreements (BBC News). Nevertheless, the government has tasked the HMRC with producing a new customs system for post-Brexit trade.

The C-Word

Costing £160 million, HMRC’s new Customs Declaration Services (CDS) seems to be Brexit’s latest centre of controversy. Due to come into effect in January 2019, it’s expected to replace the current CHIEF system in handling the UK’s estimated 255 million customs declarations each year. The system has come under fire for being underfunded and undertested, with no contingency and only two months to resolve teething issues before the UK officially leaves the EU (Owen Bennett, Huffpost).

Reported by Business Insider UK, Guy Patten, Chief Executive of The UK Chamber of Shipping, suggested British ports face ‘gridlock’ post-Brexit, slowing down the process time for lorries, thus reducing the number able to pass through each port daily. Should this deter UK businesses from trading abroad though?

Paul Hull, European & Irish Director at KMB Shipping believes these potential issues are making businesses tentative about international trade. He states “With politicians keeping their Brexit cards very close to their chest, there is a great deal of uncertainty in the UK, which is making businesses extra cautious. After all, its human nature to fear the unknown.”

The P-Word

Planning, that is. Being prepared for the change in documentation and process change could prevent delays and costs incurred with inevitable teething problems of a new system. Writing for WorldFirst, Allie Renison from the Institute of Directors suggests having exploratory discussions with freight forwarders to assess potential cost implications. Ensuring your freight forwarder is experienced and flexible, and establishing a good relationship with them may be the key, particularly for smaller businesses who may not have the time or the manpower to dedicate to unravelling the Brexit web.

KMB Shipping has 30 years’ experience in delivering our full range of shipping services to over 70 different countries, to a growing international client list. As members of BIFA, we offer a flexible and fully tailored service, managing the whole shipping process for you from initial phone call to safe delivery. Contact our professional, friendly and highly experienced team today to discuss how we can accommodate your shipping requirements.