Preparing for future customs arrangements

The government has taken welcome steps towards clarity with the publication of two papers on customs, as well as the delivery of an extensive outreach programme to engage business on the critical issues surrounding a new customs regime.

The CBI welcomes the strategic objectives that the government has described, including the need to avoid a hard border between Ireland and Northern Ireland, the renewed focus on the UK’s global economic relationships, and the importance of trade with the EU being as frictionless as possible.

More widely, business has identified the challenges most significant to the delivery of a new customs border. These issue include:

• The need to maintain the overall competitiveness of UK business
• The monetary investment, time and resource that businesses need to prepare for a new UK-EU border
• The monetary investment, time and resource that governments in both the UK and EU27 need to prepare for a new UK-EU border
• The importance of delivering a functioning ICT system to deal with customs declarations
• The need to prepare the UK’s port, air, and road infrastructure for changes

However, while government is clearly considering some of these issues closely, businesses have yet to see the detailed, joined-up solutions that will be required to deliver trade that is “as frictionless as possible”. There remain serious questions over the government’s capacity to implement new systems and infrastructure with the time and resource currently available and – subsequent to that – to support businesses through the same changes. Additionally, while the ambitions and principles the government have laid are the right ones, most rely on successful negotiation of an unprecedented comprehensive customs partnership with the EU. Without this, the proposals the government has so far presented will not be sufficient to support the competitiveness of UK businesses trading with the EU, or their supply chains.

Companies are eager to continue the discussions begun with government to help deliver an approach that provides answers across all of these issues. The CBI will continue to facilitate cross-sectoral consultation between business and government, and encourages departments to continue joined up working on this important issue.

This submission argues that:

1. A transition period will be essential to provide businesses with sufficient time to prepare for a new customs arrangement
2. The majority of businesses believe that the UK government should seek a highly streamlined customs arrangement with the EU and companies can support the introduction of facilitations to achieve this
3. Irrespective of the approach that government takes there are certain issues that will require resolution. These include questions around: the UK’s infrastructure; government ICT systems; business readiness; links to EU counterparts; regulatory equivalence.