Logistics Chiefs Warn Over Brexit Threat to N. Ireland Trade

(Bloomberg) -- Logistics chiefs warned trade between Great Britain and Northern Ireland is at risk of disruption at the end of the year because key IT systems aren’t ready.

The U.K.’s Customs Declaration System still needs alterations to make it fully operational by Jan. 1, and the government hasn’t yet laid out contingency plans in case it isn’t ready, Steve Bartlett, Chairman of the Association of Freight Software Suppliers, told a parliamentary panel on Wednesday.

“There are high levels of concern about Northern Ireland-Great Britain trade because of issues with systems, infrastructure and information delivery,” Elizabeth de Jong, Director of Policy at Logistics U.K., told the committee.

As an example of how complicated it could become, she cited the example of a parcels truck in which each of 5,000 consignments will require a safety and security declaration with 36 fields to complete.

She warned of the risk of an “overwhelming number” of customs formalities which “could deter trade to Northern Ireland” -- something that would not be in line with the government and EU’s pledges for Brexit “to impact as little as possible on everyday life of communities.”

With the U.K. and European Union still locked in discussions about a trade deal to take effect when the transition period ends, British exporters -- and traders in mainland Great Britain who sell products into Northern Ireland -- are still in the dark about the full level of extra bureaucracy from Jan. 1.

Tate & Lyle Plc and Associated British Foods Plc are among food companies that have warned the uncertainty over the terms of trade with Northern Ireland could lead to supply shortages there, according to ITV News.

The government has sought to alleviate issues around trade into Northern Ireland with controversial legislation that it concedes will break international law by allowing ministers to to ignore procedures that Prime Minister Boris Johnson signed up to as part of the Withdrawal Agreement with the EU.

Deterring Trade

The provisions in the Internal Market Bill, which the government maintains will only be needed in the event no trade deal is reached, would waive customs paperwork on trade crossing between Northern Ireland and Britain and allow the government to unilaterally define which goods entering Northern Ireland would be liable for tariffs in the event no trade deal is signed with the EU.

While the House of Lords stripped out those clauses from the legislation on Monday, Johnson immediately vowed to push ahead and reinstate them when the bill returns to the House of Commons.

Absent any certainty, De Jong said traders need “mitigations, simplifications, trusted trader schemes for certain movements” in order to make the end of transition “manageable and for trade to keep flowing.”

For his part, Bartlett warned IT systems still need extra functionality to make them “workable” after the transition period ends.

While the government has promised updates by early December, “that gives us little or no time to test these interfaces and test that the system works, and even less time to actually deploy this and roll it out to our customers” he said. “We are very worried because it is very much an unproven system.”

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