Sat. Jan 22nd, 2022

The government’s plans to introduce post-Brexit customs controls later this year could undermine the commercial “level playing field” for UK regional ports, the body representing some of the country’s largest port operators warned.

Charles Hammond, chairman of the UK Major Ports Group, which includes 40 major ports, said government funding for customs parks ran the risk of unfairly distorting the market in favor of English Channel ports serving the “short sea route”.

The domestic sites will be used to conduct physical inspections on EU imports, which are due to start in July.

Hammond’s intervention came when the government promised to unveil a levy structure for its domestic border facilities in the new year, including a main site in Sevington, Kent, which would set the standard for levies levied by other British ports.

The government has committed £ 470m to post-Brexit port infrastructure, of which £ 200m has been shared among 41 UK ports by a port infrastructure fund to build border inspection facilities needed for new customs control.

However, the Port of Dover and the Channel Tunnel site at Folkestone were not obliged to build boundary infrastructure because they did not have the physical space at their sites.

Instead, trucks arriving at these “roll-up, roll-off” canal ports will be sent inland for inspection at Sevington and other UK government-controlled sites, such as Dover White Cliffs. Hammond argued that it provided a potentially unfair advantage over ports that financed their own infrastructure.

“The government needs to come up with a pricing model that creates a level playing field because we know we will have to recoup our operating costs,” Hammond said, arguing that ministers should find a way to reduce costs to the Channel ports. to give back. .

“To be fair, in the market, the cost of this [ports] must be passed on to the parties benefiting from deciding whether to recover those costs from customers, freight forwarders or whoever it may be.

Tim Reardon, head of the EU exit for the port of Dover, rejected the idea that Dover is a beneficiary of the British government-built customs parks or that the authorities would return levies to port operators.

“How the government chooses to recover the cost of the Sevington operation is its choice,” he added. “User levies can be levied on importers whose goods are moved to Sevington, but I do not see them charging the ferry company or Port of Dover, because neither is in any sense a ‘user’ of the site. ”

The Major Ports Group has argued that failure to price Sevington competitively will diminish the benefits of Brexit for regional ports, which is expected to see an increase in traffic as EU exporters sent more unaccompanied cargoes to the UK to avoid border bureaucracy.

“The Brexit transition means friction in trade and our members are fully committed to working with the government, but the consideration is that we would expect trade to spread along the east and west coasts. [of Britain], “he added.

New border facilities in existing ports were only two-thirds funded by the government’s port infrastructure fund, which left operators with a total of £ 100m to fill the shortfall, according to estimates by Major Ports Group.

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Richard Ballantyne, chief executive of the British Ports Association, a trading body, said many operators were concerned that the new levies would create a competitive advantage for specific routes.

“If you price things inappropriately, other routes could be harmed,” he added. “The main issue is that the government’s prices have not yet been published, and ports want to talk to their customers about what this new regime will be.”

People close to the case said that internal discussions about the pricing mechanism had been going on within Whitehall for several months, with the help of private consultants, but that no decisions had been made.

But senior British officials MPs said last month that port operators can expect the government to set out its domestic regime levy regime “early in the new year”.

Emma Churchill, head of the Border and Protocol Delivery Group in the Cabinet Office, said that although it was a “commercial decision” for port operators to set their own prices, she understood why they were waiting for the government to charge its fees. announce.

“I admit that they were quite frustrated that we did not already set it out,” she said.

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