Stuck in Kent: How Brexit Red Tape Strangled Cross-Border Trade

(Bloomberg) -- Branimir Vuckovic shuttles goods back and forth between Britain and the European Union, his Beep Beep Express Ltd. making deliveries to clients in Germany, Serbia and his native Croatia.

But now he is stuck. The 45-year-old can’t find a broker to prepare the customs documents he needs after Brexit. Vuckovic spent this week driving around Kent seeking help -- to no avail. He was repeatedly turned away by shipping agents who weren’t taking on new clients.

“Who is going to do the paperwork?” Vuckovic said in a telephone interview. “No one.”

Vuckovic’s experience highlights a flaw in the U.K.’s preparations for Brexit: a lack of trained workers to help firms navigate their way through the labyrinth of customs procedures that have been imposed since Britain’s departure from the EU. Even with a trade deal in place, businesses still face new checks and paperwork.

The staff shortage is already hampering the flow of goods and has pushed up the cost of shipping them, Stephen Phipson, chief executive of Make UK, Britain’s biggest manufacturing lobby group, told a panel of lawmakers Wednesday.

200 Million Forms

While the government avoided significant disruption at ports in the days after Brexit -- largely because firms stockpiled goods or delayed deliveries until February -- the shortage of customs agents means that trade could take longer to rebound to its former levels, hampering any wider recovery in the U.K. economy.

Britain’s logistics industry had warned that businesses would need to hire an additional 50,000 workers to process the 200 million extra customs forms that will be required annually after Brexit.

The U.K. government has repeatedly declined to disclose how many agents there currently are, saying it’s a matter for the market. Phipson said the latest data shows there are between 11,000 and 12,000. That has left firms struggling to get help.

Eddie Maybank, an independent customs broker, has been so overwhelmed by inquiries that he has been forwarding them on to other agents in Dover. But he was told this week to stop because they were also at capacity.

‘I’m Inundated’

“I’m having a breakdown really,” Maybank said. “I’m inundated, and so is everyone else.”

Even if firms can hire an agent, the experts are finding themselves bamboozled by the new procedures. They complain of difficulties in obtaining export health certificates -- documents required for food or animals -- and of forms being rejected because they hadn’t used the correct color of ink.

Lukasz Piotrowski of PMA Trade Ltd. has a lorry carrying plastic containers for mushrooms to Poland stuck in Dover, costing his business about 1,000 pounds ($1,364) a day.

“Having a professional customs agency on both sides of the border hasn’t really helped because neither the export agency in the U.K. nor the import agency in the EU know specifically what to do,” he said. “There are times I’m so frustrated I want to close the company.”

The government has conceded the shortage of staff is a problem -- but says it isn’t limited to the U.K.

Give Up?

“We are starting to realize that customs agents’ capacity and capability is being extremely stretched -- and this is on both sides of the border,” Heather Jones, a deputy director of the government’s Border and Protocol Delivery Group, told an online question-and-answer session for businesses on Thursday.

Even the biggest logistics firms are struggling to grapple with the new paperwork.

Kuehne + Nagel International AG, one of the world’s largest freight-forwarding firms, is turning away new business, and staff are working 90-hour weeks to keep goods flowing, according to a person familiar with the matter, speaking on condition of anonymity. About 20% of the freight it is handling is encountering Brexit-related problems, with some shipments facing days-long delays, the person said.

DB Schenker, a major logistics company owned by German rail giant Deutsche Bahn AG, has suspended deliveries to the U.K. due to “significant” problems with Brexit paperwork. Only about 10% of goods it was being commissioned to ship had the right customs forms, DB Schenker said in a statement.

Coronavirus Pandemic

Efforts to train more customs professionals were stalled by the coronavirus pandemic, and some firms have been outsourcing the work to cheaper labor overseas. The U.K. government created an 84-million-pound fund to finance training of new agents -- but that had almost been exhausted by the end of 2020.

The shortage of workers to handle customs paperwork has meant that trucks haven’t been getting as far as the ports. Drivers are facing long waiting times at warehouses and factories due to inadequate or non-existent Brexit paperwork.

Magiboards, which manufactures whiteboards, had a consignment from the Netherlands delayed because its goods were shipped with other deliveries, some of which didn’t have the correct Brexit clearances.

“They had to turn the lorry around, go back to the depot, unload the goods from suppliers who hadn’t fulfilled the requirements and go back,” said Erwin van der Stap, managing director of the Telford-based company. “We’re losing orders and letting customers down.”