We have a new Brexit deadline of 31 January 2020. This is flexible and we could leave the EU before that date if the withdrawal agreement is ratified quickly. That said, there is also talk of a general election before Christmas and, depending of the outcome, this could herald further change and uncertainty.
Parliament is keen to avoid a no deal Brexit, but that doesn’t mean it has been ruled out completely.
If we do end up in a no deal situation this could mean that SMEs would struggle, as more than half don’t have a contingency plan for a no deal Brexit. The FSB estimates that only one in seven has planned for this.
We are working closely with our insurer partners to understand the insurance implications for all our customers and will continue to update this page as things unfold.
How will Brexit affect the haulage industry?
With an estimated 33,000 freight vehicles entering and exiting the UK every day just via Dover, the impact of Brexit could be significant in a number of areas:
- An end to the free movement of people
- An increase in the number of customs checks causing delays and slowdowns
- The expectation that drivers will require additional licences and CPC checks
- A no deal would put restrictions on the movement of goods between the UK and EU countries meaning additional permits such as the ECMT will be required.
What will be the requirements for licences and permits?
Standard International Operators Licence along with a Community Licence are needed currently by haulage firms carrying out long distance journeys to EU member countries. In the event of a no deal it’s expected that the EU will no longer recognise these Community Licences, meaning it won’t be possible to use them to enter the EU.
This means drivers will need an ECMT permit. However, only 1200 ECMT permits will be granted to the UK, with only 60 of these earmarked for haulage businesses based in Northern Ireland. The RHA have suggested that there could be just 5% of the number of the permits required.
If you are a fleet manager, you should consider the following:
- Make sure you are aware of how many permits your company may need.
- Remember, some vehicles will be exempt from permit requirements, for example, vehicles under 3.5 tonnes.
- Permits are expected to be issued by the end of the year so if you’ve not applied you need to do so.
- The Department for Transport are advising companies to have contingency plans in place if they do not receive the number of permits they apply for.
What will change for drivers heading to Europe post-Brexit?
A number of existing conventions mean that drivers will still be able to drive in the EU after Brexit however there may be additional requirements. The Department for Transport state that an International Driving Permit which is appropriate to the countries to be visited could be required. Applying for additional licences not only adds extra time but also extra costs, both for the licence and administrator involved in the organisation.
In the event of a no deal Brexit, drivers will also need to be in possession of a Green Card from their insurer. Essentially these are international insurance certificates proving that you have the necessary insurance in place.
Do also keep an eye out for news on CPC requirements. If the EU choose not to recognise UK issued CPC’s this may inhibit UK driver’s ability to drive for an EU operator and require them to also obtain a CPC qualification issued by an EU country.
The EU have published their guidance for a no deal situation. This includes the news that they would maintain the movement of goods between the UK and EU until the end of 2019, reducing the need for additional permits for drivers in 2019 if the UK were to leave without a deal.
What is the impact on cargo and freight travelling to the continent if there’s no deal?
Border Force predicts that freight traffic crossing the Channel to mainland Europe could be restricted by between 75% and 87% in the event of a no deal Brexit. This could continue for 6 months or longer.
“Third country” border controls would be imposed by France at customs, meaning that all documents would be checked, slowing proceedings at Calais and other European ports.
Operation Brock has been put in place on the M20 motorway in Kent to test a stacking system for freight traffic waiting to cross the Channel.
What implications does stock-piling goods have on a business’s insurance?
The introduction of new customs checks is likely to cause major delays and slowdowns for haulage firms. This could have a knock-on effect to supply chain management, the ability to transport fresh goods such as fruit and vegetables and the ability of companies to plan whilst such a level of uncertainly remains.
If your business is in the same position of sourcing products from European countries and are planning to increase your stock holdings due to Brexit concerns, then please do bear in mind the impacts this may have on your business insurance coverage or other insurance products.
Insurance policies will typically define a sum insured amount in the policy wording so please do check this to ensure any additional stock holding will still leave you within your insured limits. You do not want to find yourself in the position of being underinsured something which could put your business under significant strain if you were to need to make a claim.
What will happen to employee rights post-Brexit?
Many EU workers employed in the UK are choosing to leave and go back to their home countries or other EU countries to work. In part this is because of the level of uncertainty around their rights once Brexit is finalised.
The UK Government has stated that any EU citizens currently living in the UK will be able to remain with their current rights, but this is still up in the air until a deal is either completed or the UK leaves without a deal.
What will happen to UK immigration policies post-Brexit?
As with all things Brexit, this is not yet defined but if we see the end of the free movement of people between the UK and EU countries then access will need to be defined in another way.
Current discussion is around immigration policies being set on income-based criteria. The Government is proposing that there’s a consultation around a minimum £30,000 salary level.
Will Brexit have an impact on a business’s intellectual property?
It is still not clear whether national intellectual property rights will be protected at the European Union Intellectual Property Office.
What is the impact of Brexit on businesses which trade with the EU?
A new trade deal with the EU still needs to be finalised. As long as we leave with a deal in place, this will be negotiated during the 21-month transition period starting once Brexit happens.
If the UK leaves without a deal, then the same rules will apply as those for businesses which trade with countries outside the EU.
They have also published technical guidance for small businesses in the event of no deal.