Brexit trade with EU ‘getting worse’ say exporters
Business leaders say the second anniversary of Brexit today has been marked by continuing difficulties for exporters trying to trade with the EU.
Huge lorry queues were again seen at Dover last week and the British Chambers of Commerce say it is time for urgent action to improve the situation.
Its comments emerged as the UK government indicated that a new “Brexit Freedoms” bill aims to make it easier to shed EU regulations post-Brexit.
Number 10 said the reforms will cut £1bn of red tape, with the proposed measures set to be published by the government later today.
It added that the new bill will “ensure that changes can be made more easily, so that the UK can capitalise on Brexit freedoms more quickly”.
More than half of UK exporters (60%) surveyed by the BCC in November 2021 reported difficulties in trading with the EU, an increase from 49% in January 2021.
The trade group says pictures of lorries stacked up on the A20, waiting to get into the port of Dover, offer a vivid illustration of the problems continuing to impact the operation of the trade deal between the UK and the EU.
In a statement, Prime Minister Boris Johnson said: “The plans we have set out today will further unleash the benefits of Brexit and ensure that businesses can spend more of their money investing, innovating and creating jobs.
“Our new Brexit Freedoms Bill will end the special status of EU law in our legal framework and ensure that we can more easily amend or remove outdated EU law in future”.
Labour shadow attorney general Emily Thornberry MP, said: “For all this talk from the government about the potential legislative freedom we have outside the EU, they still refuse to make a concrete change the Labour Party has been demanding in this area for months, which is the removal of VAT on people’s energy bills.”
William Bain, head of trade policy at the BCC, said: “One of the issues at Dover currently appears to be linked to the export of food products across the Channel. Like many of the problems this looks to be down to a differing interpretation of how the trade arrangements work after leaving the EU.
“In this case we are hearing French customs require a wet signature on paperwork for exports of animal and plant products, but as much of the documentation is produced digitally this is creating hold-ups.
“It is the latest in a string of issues with the trade deal that speaks to the wider problems of interpretation, inconsistent application and glaring gaps in its coverage.
“No-one is expecting goods to flow as freely across the channel now as they did prior to Brexit. But the way the trade agreement is being interpreted in 27 different EU countries is a major headache for UK business – especially smaller firms without the cash reserves to set up new EU based arrangements.
“Yet it doesn’t have to be this way. It is possible for the UK Government and EU to take a pragmatic approach and work together to reach new understandings on a consistent interpretation of the rules and to build on them further.
“Accredited Chambers of Commerce support the UK Government’s ambition to massively increase the number of firms exporting. Freeing up the flow of goods and services into the EU, our largest and nearest overseas market, will go a long way to realising that goal.”
Liam Smyth, managing director of ChamberCustoms, added: “At ChamberCustoms we work, day in and day out, with companies to help them navigate the complexities of international trade. We’ve seen a huge demand for our services in relation to trading with the EU since the implementation of the trade deal, and we know first-hand what difficulties firms on the ground are facing.
“If the UK Government and the EU are willing to take action on these proposals from the Chamber Network it will serve to improve trading conditions and let businesses get on with growing our economy and generating prosperity.”
The BCC has set out five key issues, and the solutions needed, to improve EU trade.
- ISSUE: Export health certificates cost too much and take up too much time for SME food exporters.
- SOLUTION: We need a supplementary deal on this which either eliminates or greatly reduces the complexity of exporting food for SMEs.
- ISSUE: Some companies are being asked to register in multiple EU states for VAT in order to sell online to customers there.
- SOLUTION: We need a supplementary deal, similar to Norway’s with the EU. This exempts the smallest firms from the requirement to have a fiscal representative and incur these duplicate costs.
- ISSUE: As things stand CE marked industrial and electrical products will not be permitted for sale on the market in Great Britain from January 2023/4. The same is true for components and spares.
- SOLUTION: We need action from the Government to help businesses with these timelines. Many firms are far from convinced about a ban on CE marked goods in Great Britain.
- ISSUE: UK firms facing limitations on business travel and work activities in the EU.
- SOLUTION: Government needs to make side deals with the EU and member states to boost access in this area as a priority for 2022.
- ISSUE: Companies starting to be pursued in respect of import customs declarations deferred from last year.
- SOLUTION: We need a pragmatic approach to enforcement to ensure companies recovering from the pandemic do not face heavy-handed demands too quickly on import payments, or paperwork.