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Policy & Compliance


Preparing for EU-Exit stages 2 and 3


After the problems encountered at the start of this year, it is important to consider the impact on your business of the requirements at EU-Exit stages 2 and 3 well before the implementation dates


This year, 2021, has been extremely challenging for the freight forwarding and logistics sector. In the UK we have been faced by global problems stemming from the COVID-19 pandemic and capacity issues resulting in disruption and significant price increases, particularly in the deepsea environment. Domestically, the UK has had to face additional supply chain disruption stemming from our leaving the EU on 31 December 2020. Many Members were relieved when, on 11


March, the government announced delays of between six and nine months to Stages 2 and 3 of the implementation plan detailed in the Border Operating Model. These two stages, which have been moved back six months from their original dates to 1 October 2021 and 1 January 2022 respectively, primarily impact imports into the UK.


Unexpected difficulties One lesson that the changes implemented on 1 January this year has taught us is that the practical application of the changes is often more difficult than anticipated. Therefore, it is important to start considering the impact of the requirements at Stages 2 and 3 on your business well before the implementation dates. This is particularly relevant as there will be new terminology to master, for instance under the Pre-Lodgement/Goods Vehicle Movement Service (GVMS) there are three categories of ports being introduced. An additional complexity is that although


government has provided information, there are important gaps that need to be filled in order to allow business to make certain key operational decisions. One of the most important of these is that despite constant pressure, we are still lacking full clarity as to which ports will be operating a Pre-Lodgement, as opposed to a Temporary Storage, model for processing cargo. Also, into this already difficult situation we have other considerations such as hauliers withdrawing from the international road haulage sector, reducing capacity and capability,


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although that is partly being offset by increases in unaccompanied trailer and shortsea movements. Despite re-assurances from government there


are concerns among Members about whether the necessary infrastructure will be built in time to meet the appropriate dates detailed on 11 March this year. Originally due to have been introduced on


1 April 2021 but delayed by six months until 1 October 2021, there will be additional checks on products of animal origin and high risk foods not of animal origin. Traders will be required to declare and submit relevant documents on the Import of products, animals, food and feed system (IPAFFS) for all sanitary and phytosanitary (SPS) goods and the original documents will need to be available for inspection. It is anticipated that in most cases this will be undertaken after the goods have been cleared and released at the frontier. On the same date, the requirement for


submitting an Exit Summary Declaration (EXS declaration) for empty vehicles, pallets, containers returning to the EU and goods in ro-ro vehicles will be introduced, meaning an EXS for such movements will be mandatory. It had been intended to implement the third


and final stage of full border controls on 1 July 2021, but now these controls will be implemented on 1 January 2022. From a Customs perspective the most important changes will be the ending of the Delayed Declaration Scheme on 31 December 2021.


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After this date, a customs entry, full or


simplified, will be required at the frontier for goods originating from the EU to the UK mainland. Dependent on location, the declaration will have to be submitted as a pre-lodged declaration utilising the Goods Vehicle Movement System (GVMS) or as a frontier declaration where goods enter the UK. Linked to this is the requirement for a Safety and Security (ENS) Declaration to be submitted prior to the goods being loaded on the means of conveyance bringing them to the UK. With regard to perishable products, the main


change will be the introduction of physical checks at the Border Control Point (BCP) on high risk plants and agri-food and feed, including products of animal origin (POAO) and high risk food and feed not of animal origin (HRFNAO). Checks on live animals, low risk plants and plant products are delayed until March 2022.


Multiple challenges As the reader can see, there is much to consider and prepare for, and there is not much time to do so. There are new systems such as GVMS and potentially the Safety and Security System to gain access to and learn how to utilise. In many ways, the bigger challenge will be to manage data flows to ensure that carriers are able to have the correct movement reference numbers available to allow them to move from the EU to UK. Whilst Members will have to consider their


own preparations, from enquiries we are still receiving from importers and exporters it is clear that their preparations will have to be monitored and encouraged. It may be appropriate to encourage customers, particularly those who primarily trade with the EU, to register for HMRC’s updates at: https://public.govdelivery. com/accounts/UKHMRCED/subscriber/new?pref erences=true#tab1 Primarily, these new controls and procedures


will be affecting imports into the UK from the EU, and it is to be hoped that the additional period allowed for preparation by deferring their implementation has been wisely used. Recent history teaches us that the days after 1 January 2021 were very challenging, although trade did not grind to a halt as many had predicted. The new fear is that we face much greater challenges after 1 January 2022 than we did the previous year, if only because there are more new processes to master and, historically, import traffic levels exceed export levels by a ratio of approximately 2:1. Perhaps the most frightening and telling comment that the writer has heard was an EU trader saying: “We (EU business) do not believe that it (introduction of controls) will happen on 1 January next year”.


August 2021


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