The announcement of a Brexit transitional period ending in December 2020 will be a welcome relief for manufacturing and retail businesses exporting and importing from the EU, according to the Freight Transport Association (FTA), the only organisation which represents all of logistics in the UK.
However, FTA has warned that there is still much to agree on the detail of the UK's departure from the European Union, and the EU's "nothing is agreed until all is agreed" principle still leaves logistics operators uncertain over the future.
"After months of negotiation, the news that a transitional period is finally proposed by both sides is positive news for British business," says James Hookham, Deputy CEO of FTA. "But there is still a huge amount of technical agreement required to ensure that trade can continue to move between the UK and the European Union with as few delays as possible, if industry and businesses are not to be left with huge breaks in their supply chains, at the end of the transition period.
"By ratifying the transitional period to run over the next 20 months, negotiators will be granting business a welcome breathing space in which to formulate plans and learn new processes for trade after December 2020. However, this timescale and its detail is still to be formally ratified by both sides, and with the inherent risk of a 'no deal' outcome at the end of negotiations, business should be wary of complacency and plan accordingly."
FTA, which represents more than 17,000 businesses moving goods and services across the UK, Europe and globally, is asking for clarification on the processes which will enable trade to continue to move smoothly, as well as the staff needed to support the sector:
"Today's news from Brussels is welcome, as far as it goes," Hookham continues. "We seem to be getting more time to agree the new border procedures and there is some confidence that UK employers will be able to continue to employ EU nationals up until the end of the transition and beyond, as long as those are permanent residents in the UK or frontier workers. But business still needs to know what customs and trade procedures look like after the transition period: the customs duties and taxes, the formalities required in the UK and the arrangements for border inspections of goods, the number of trucks that will be allowed to cross the border and the arrangements for the recognition of drivers' licences and qualifications.
"Clarification in these two areas is a good start but we are still a long way from achieving low friction trade after Brexit. The transition period is welcome but it still leaves a lot for government and industry to achieve in an incredibly short space of time."
FTA is the only organisation in the UK that represents all of logistics, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers whose businesses depend on the efficient movement of goods.