European Shippers Council fears chaos from no-deal Brexit

Brussels-based European Shippers’ Council (ESC) has said that a no-deal Brexit would likely cause chaos in the Channel ports.

ESC secretary general Godfried Smit said that “many companies are already too late, because to have distribution organized in a proper way you have to have, perhaps, additional warehouse space in the UK”, adding that “it’s the same situation if you want to do your own customs declarations. You would need to install your own automated system and there aren’t enough customs software developers and installers”.

He noted that companies that decided instead to employ a customs agent would also face difficulties, because “there are only so many, and most are already working for their long-term customers”.

Smit told FreightWaves that ports on the English Channel would be chaotic in the days and weeks after a no-deal Brexit and that shippers urgently needed to prepare for the worst. “I think the impact will vary much from sector to sector, and there is also separation between big companies and smaller companies. But we see still a lot of companies that are not fully prepared.”

Meanwhile the UK’s revised Brexit plan effectively would create an intra-customs clearance “border” on the Irish Sea. This could see cargoes crossing the Irish Sea necessitating the completion of customs formalities, even if both the port of loading and the port of discharge are part of the UK.

The ports sector has pointed out the practical difficulties that would arise if the revised Brexit plan were implemented

Under the revised proposal Northern Ireland would remain in a special relationship with the EU from the date of the UK’s exit until 2025. This would necessitate customs checks on the land border between Northern Ireland and the Republic of Ireland, and an artificial border between Northern Ireland and Great Britain. This would be because Northern Ireland, although formally leaving the EU customs union and the single market, would remain in regulatory alignment with single market. In 2025 the Northern Irish Assembly would decide whether to continue with regulatory alignment, or whether to adopt the mainland UK regulatory framework then in place.

Several maritime bodies have expressed concern at the proposal.

Tim Morris, chief executive of the UK Major Ports Group, noted that four times as much trade flowed across the sea between Northern Ireland and mainland Great Britain as moved across the land border between Northern Ireland and the Republic.”

Morris said that we potentially would need to create border infrastructure and complexity at even more UK ports than is currently anticipated.

The British Ports Association (BPA) said the UK proposal would be a challenge. “The majority of Northern Ireland’s trade is with Great Britain and a border in the Irish Sea would be extremely challenging for the ports in Northern Ireland and those in England and Scotland who have freight routes,” the association said, adding that “a ‘no deal’ situation could cause displacement issues for Welsh ports.” The BPA felt that the best way to maintain frictionless trade was a deal that avoided customs or regulatory checks entirely.

The UK Chamber of Shipping told Lloyd’s List that “we cautiously welcome the proposals put forward by the prime minister today, as long as it is confirmed that there will be no customs checks on board ferries in the Irish Sea. The industry should not take on the role of conducting border checks, which are the responsibility of the government and its agencies.”