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April 16 2018

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62 The Journal of Commerce | April 16 2018 Government FEARS AMONG SHIPPERS that the United Kingdom would implement shock therapy, an abrupt separa- tion from the 28-nation European Union, have eased. London and Brussels reached an agreement for a 21-month transition period after March 29, 2019, the date the UK leaves the bloc. EU leaders have agreed to keep the UK in the bloc's single market and customs union until Dec. 31, 2020, and a new trade agreement will be negotiated. The UK and EU transportation sectors ramped up warnings about the impact of Brexit, particularly on ports, but there are few signs that the British government has taken much notice or drawn up concrete plans. The European Sea Ports Organi- sation said Brexit negotiators should prioritize transportation and, in particular, the maritime sector, given that much of the trade in goods between the UK and its 27 EU partners passes through ports. "Europe's ports need certainty and time to adapt to the new reali- ties post-Brexit if they are to con- tinue to perform their vital function as nodes in intra-Euro- pean supply chains," said Eamonn O'Reilly, chairman of the Brus- sels-based group. "If the current short-sea fluidity is compromised, there will be no winners." European shipowners also are pressing their governments to wake up to Brexit's potentially disruptive impact on transportation flows. "After Brexit — unless the European Union and United Kingdom find a workable agreement — a cargo dec- laration will be necessary together with other checks and controls linked to, among others, immi- gration and phytosanitary control rules," said Martin Dorsman, secre- tary general of the European Com- munity Shipowners' Associations. "It will mean heavy congestion in ports lacking enough space for the huge numbers of lorries [trucks] and trailers, and just-in-time supply chains will cease to exist, due to the congestion problems." The British government has yet to come up with any concrete ideas about how borders will operate after Brexit, according to Peter MacSwiney, chairman of the Joint Customs Consultative Commit- tee, a government-sponsored group representing about 20 trade organizations. "I don't think we're anywhere," he said." There are no practical measures on the table that I can see — endless discussions about theoretical concepts, but not about what we are actually going to do on day one." The key issue remains Brexit's impact on the 10,000 or so trucks that pass every day through the port of Dover, one of the world's largest roll-on, roll-off shipping hubs, and the nearby cross-channel Eurotun- nel linking the United Kingdom with France. The UK government is putting on a brave face, with Transport Sec- retary Chris Grayling recently dis- missing constant claims of 30-mile backups at the port of Dover after Brexit, and claiming physical checks on trucks after the UK quits the EU would be "utterly unrealistic." "We will maintain a free-flow- ing border at Dover — we will not impose checks in the port. We don't check lorries now — we're not going to be checking lorries in the future. We will manage trade electronically. Trucks will move through the border without stopping. We will manage them electronically ... in the way it happens between Canada and the United States." While the 21-month transition period is welcome news for the Euro-pean transportation sectors, Brexit threat diminished — for now Despite a longer transition period, ports and shippers are taking action well in advance of the UK-EU divorce By Bruce Barnard If the current short-sea fluidity is compromised, there will be no winners." International | Washington | Customs | Security | Regulation

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