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Brexit: UK exporters caught in red tape and delay as criticism grows Marks & Spencer Percy Pig sweets hit by Brexit red tape
(about 1 hour later)
New border rules introduced last week are already creating problems for exporters and traders, say firms. New Brexit trade rules could mean extra tax on Marks & Spencer's Percy Pig sweets outside the UK.
Marks & Spencer has become the latest company to warn of more red tape and rise in export costs to some countries. The sugary treats are made in Germany before being shipped to the UK, then re-exported to M&S outlets in Ireland, France and the Czech Republic.
Parcels giant DPD has suspended some services, and a seafood exporter said the chaos was like being "thrown in the cold Atlantic without a lifejacket". That means they fall foul of complex "rules of origin" regulations that now govern UK-EU trade.
The new border rules introduced last week are already creating problems for exporters and traders, say firms.
On Friday, M&S chief executive Steve Rowe warned of more red tape and a rise in export costs to some countries.
"The best example I can give you of that is Percy Pig," he said,
"Percy Pig is actually manufactured in Germany. If it comes to the UK and we then send it to Ireland, in theory it would have some tax on it," he added.
M&S said it was "actively working to mitigate" the effects of the rules.
Other firms have also warned about the impact of new Brexit trading rules. Parcels giant DPD has suspended some services, while a seafood exporter said the chaos was like being "thrown in the cold Atlantic without a lifejacket".
One export trade body told the BBC there was a "growing problem and sense of unease" among its members.One export trade body told the BBC there was a "growing problem and sense of unease" among its members.
Shane Brennan, chief executive of the Cold Chain Federation, which represents chilled transport and storage companies, said the emerging problems have come despite the amount of cross border traffic still being quite low.Shane Brennan, chief executive of the Cold Chain Federation, which represents chilled transport and storage companies, said the emerging problems have come despite the amount of cross border traffic still being quite low.
"Trade flows are still only about 50% of what we would expect, but even at those levels we are seeing levels of confusion and delays," he told the BBC's Today programme. "The feeling is we are building to quite a significant potential disruption.""Trade flows are still only about 50% of what we would expect, but even at those levels we are seeing levels of confusion and delays," he told the BBC's Today programme. "The feeling is we are building to quite a significant potential disruption."
John Lewis scrapping overseas deliveriesJohn Lewis scrapping overseas deliveries
Were there hold-ups in first week after Brexit?Were there hold-ups in first week after Brexit?
Why are there empty shelves in some supermarkets?Why are there empty shelves in some supermarkets?
Covid tests for Channel hauliers to continueCovid tests for Channel hauliers to continue
A government spokesman acknowledged that there had been "some issues", but said ministers had always been clear there would be some disruption at the end of the transition period.A government spokesman acknowledged that there had been "some issues", but said ministers had always been clear there would be some disruption at the end of the transition period.
Earlier, Transport Secretary Grant Shapps told the BBC that it was estimated only about 1% of trucks have turned up at ports without the correct paperwork.Earlier, Transport Secretary Grant Shapps told the BBC that it was estimated only about 1% of trucks have turned up at ports without the correct paperwork.
However, anger is growing among companies whose livelihoods depend on export trade.However, anger is growing among companies whose livelihoods depend on export trade.
In a letter on Friday to Business Secretary Alok Sharma, the Scottish salmon producer John Ross Jr launched a stinging attack on the government's handling of the situation.In a letter on Friday to Business Secretary Alok Sharma, the Scottish salmon producer John Ross Jr launched a stinging attack on the government's handling of the situation.
The firm's sales director Victoria Leigh-Pearson writes that the company has in recent months "had to endure the government issuing a barrage of useless information" and "absence of factually incorrect information from all government agencies." It amounts, she says, to "gross incompetence".The firm's sales director Victoria Leigh-Pearson writes that the company has in recent months "had to endure the government issuing a barrage of useless information" and "absence of factually incorrect information from all government agencies." It amounts, she says, to "gross incompetence".
John Ross exports to 36 countries and has won the Queen's Award twiceJohn Ross exports to 36 countries and has won the Queen's Award twice
Part of the letter to Alok Sharma:Part of the letter to Alok Sharma:
As I write, perishable goods that were dispatched from our facility five days ago, headed for France following a process that your department advised, have still not crossed the border. This usually takes only 24 hours because they are consolidated with the produce of other companies, which have not been able to follow the correct procedures due to a knowledge gap directly attributable to your department.As I write, perishable goods that were dispatched from our facility five days ago, headed for France following a process that your department advised, have still not crossed the border. This usually takes only 24 hours because they are consolidated with the produce of other companies, which have not been able to follow the correct procedures due to a knowledge gap directly attributable to your department.
Entire trucks are currently being rejected without explanation by the French customs authority. Our hauliers have now pulled their services as such a backlog has been created. Other hauliers are not taking on new customers. Today, we've even had confirmation that the IT systems of the UK and France are incompatible. After four years you only establish this now?Entire trucks are currently being rejected without explanation by the French customs authority. Our hauliers have now pulled their services as such a backlog has been created. Other hauliers are not taking on new customers. Today, we've even had confirmation that the IT systems of the UK and France are incompatible. After four years you only establish this now?
Your so-called 'deal' is worthless if this situation is not fixed immediately, and unless you put in place measures to address the issues that continue to unfold on a daily basis. Moreover, as a seafood exporter, it feels as though our own government has thrown us into the cold Atlantic waters without a lifejacket.Your so-called 'deal' is worthless if this situation is not fixed immediately, and unless you put in place measures to address the issues that continue to unfold on a daily basis. Moreover, as a seafood exporter, it feels as though our own government has thrown us into the cold Atlantic waters without a lifejacket.
Yours sincerely, Victoria Leigh-Pearson, Sales Director, John RossYours sincerely, Victoria Leigh-Pearson, Sales Director, John Ross
Perfect stormPerfect storm
The UK sealed a trade deal with the European Union (EU) on 24 December that was billed as preserving its zero-tariff and zero-quota access to the bloc's single market.The UK sealed a trade deal with the European Union (EU) on 24 December that was billed as preserving its zero-tariff and zero-quota access to the bloc's single market.
But major retailers that use the UK as a distribution hub for European business could face possible tariffs if they re-export goods to the EU.But major retailers that use the UK as a distribution hub for European business could face possible tariffs if they re-export goods to the EU.
On Friday, M&S said the new trade arrangements were creating "very complex administrative processes". The red tape burden, along with potential tariffs on some exports "will significantly impact our businesses" in Ireland, the Czech Republic, and France, the retailer said.
The retailer added that the free trade agreement with the EU would not mean extra tariffs on its core UK sales.
"Tariff free does not feel like tariff free when you read the fine print," M&S's chief executive Steve Rowe told Reuters on Thursday, ahead of the retailer's trading update on Friday.
"For big businesses there will be time-consuming workarounds but for a lot of others this means paying tariffs or rebasing into the EU."
Mr Rowe said the chain's popular Peppa Pig sweets, made in Germany, were one product that could face tax rises.
It said it was "actively working to mitigate" those effects.
Rotten fish
John Ross is not the only Scottish seafood exporter suffering. The industry says it has been hit by a "perfect storm" of Brexit disruption, which could sink a centuries-old industry.John Ross is not the only Scottish seafood exporter suffering. The industry says it has been hit by a "perfect storm" of Brexit disruption, which could sink a centuries-old industry.
"These businesses are not transporting toilet rolls or widgets. They are exporting the highest quality, perishable seafood which has a finite window to get to markets in peak condition," said Donna Fordyce, chief executive of Seafood Scotland."These businesses are not transporting toilet rolls or widgets. They are exporting the highest quality, perishable seafood which has a finite window to get to markets in peak condition," said Donna Fordyce, chief executive of Seafood Scotland.
"If the window closes these consignments go to landfill." "If the window closes, these consignments go to landfill."
She said the sector has already been weakened by Covid-19, the closure of the French border before Christmas as well as "layer upon layer" of problems associated with Brexit.She said the sector has already been weakened by Covid-19, the closure of the French border before Christmas as well as "layer upon layer" of problems associated with Brexit.
The group fears that without exports, the fishing fleet will have little reason to go out.The group fears that without exports, the fishing fleet will have little reason to go out.
"In a very short time we could see the destruction of a centuries-old market which contributes significantly to the Scottish economy," added Ms Fordyce."In a very short time we could see the destruction of a centuries-old market which contributes significantly to the Scottish economy," added Ms Fordyce.
Lost in the mailLost in the mail
The parcel delivery service DPD UK said it has paused its European Road Service due to the '"increased burden" of customs paperwork for packages heading to the EU, including the Republic of Ireland.The parcel delivery service DPD UK said it has paused its European Road Service due to the '"increased burden" of customs paperwork for packages heading to the EU, including the Republic of Ireland.
DPD said 20% of parcels had "incorrect or incomplete data attached", which meant they would have to be returned.DPD said 20% of parcels had "incorrect or incomplete data attached", which meant they would have to be returned.
What Brexit means for Britons travelling, shopping, studying or owning properties in the EU.What Brexit means for Britons travelling, shopping, studying or owning properties in the EU.
In an email to its business customers, the company said that it had been a "challenging few days" for its international operation, and that it would "pause and review" its service. It plans to restart on 13 January.In an email to its business customers, the company said that it had been a "challenging few days" for its international operation, and that it would "pause and review" its service. It plans to restart on 13 January.
"It has now become evident that we have an increased burden with the new, more complex processes, and additional customs data we require from you for your parcels destined to Europe" the firm wrote."It has now become evident that we have an increased burden with the new, more complex processes, and additional customs data we require from you for your parcels destined to Europe" the firm wrote.
Hauliers grinding gearsHauliers grinding gears
The boss of one of Wales' largest hauliers said logistical problems have emerged at the Irish border too.The boss of one of Wales' largest hauliers said logistical problems have emerged at the Irish border too.
Andrew Kinsella, managing director of Gwynedd Shipping, said his company has a backlog of 60 lorries waiting to be shipped to Dublin.Andrew Kinsella, managing director of Gwynedd Shipping, said his company has a backlog of 60 lorries waiting to be shipped to Dublin.
He said many hauliers are finding that their customers are not able to generate the special declarations that are needed to ultimately enable a lorry to get onto a ferry.He said many hauliers are finding that their customers are not able to generate the special declarations that are needed to ultimately enable a lorry to get onto a ferry.
"Whilst you don't see queues at ports and terminals the reality is that these queues are developing elsewhere in our depot in Holyhead , in our depot in Deeside and in our depot in Newport in South Wales and lots of hauliers have depots in the proximity of ports," he said."Whilst you don't see queues at ports and terminals the reality is that these queues are developing elsewhere in our depot in Holyhead , in our depot in Deeside and in our depot in Newport in South Wales and lots of hauliers have depots in the proximity of ports," he said.
"There are a lot of issues about demarcation about who is going to arrange the export declaration with the UK revenue authorities, who's going to arrange the import declaration, the hauliers then trying to arrange the import safety and security declaration to create an ENS number which helps you generate a PBN number so there has been a lot of everyone finding their feet"."There are a lot of issues about demarcation about who is going to arrange the export declaration with the UK revenue authorities, who's going to arrange the import declaration, the hauliers then trying to arrange the import safety and security declaration to create an ENS number which helps you generate a PBN number so there has been a lot of everyone finding their feet".