BLOG: WHAT DOES BREXIT MEAN FOR UK CARGO?

When it comes to Brexit, the air cargo sector is stuck in a holding pattern, writes Alex Veitch.

With the UK and EU27 yet to reach an agreement on their trading relationship after the UK leaves the EU, the resulting lack of political solutions has left the sector in a state of regulatory uncertainty.

With the proposed new deadline for the UK’s departure set for October 31, 2019, how will the different options on the table – No Deal, Canada Plus, Norway-style and the Withdrawal Agreement – impact the air cargo sector?

FTA hopes the UK Parliament will approve the Withdrawal Act and Political Declaration to prevent the worst-case scenario, a No Deal Brexit, from happening.

If an agreement is reached, it would be ‘business as usual’ for aviation while the future political and economic relationship is finalised.

The Political Declaration, which points towards the final deal, includes positive statements on aviation, committing both sides to “ensure passenger and cargo air connectivity through a Comprehensive Air Transport Agreement (CATA).”

If the UK leaves the EU without a deal, temporary arrangements have been agreed to allow air connectivity between the UK and the EU territory, but there would be some restrictions on cabotage for UK cargo operators.

And while air freight security (ACC3) arrangements will enable direct cargo flights to continue, the connectivity arrangements are for a 12-month period only from the date of the UK’s departure; contingency arrangements are also in place for safety authorisations and detailed sector-specific regulation.

More broadly, in a No Deal scenario the UK and the EU would need to put in place a long-term stable Air Services Agreement and permanent arrangements on technical and safety matters as soon as possible.

To protect both the cargo and tourism markets, FTA expects negotiations on these areas to be near the top of the agenda for both sides as discussions continue; we will be campaigning hard to ensure this is the case.

Outside these scenarios, it is difficult to gaze too much into the Brexit crystal ball.

If the UK decides to go for a softer, Norway-style, Brexit or ‘Single Market 2.0’, then we might find little would change materially for air cargo.

However, a harder, ‘Canada Plus’, Brexit, or a Brexit that involves staying in a Customs Union, but not the Single Market, would likely require a future CATA.

While the risk of No Deal has receded for now, it remains the legal default in the absence of alternative arrangements. FTA is grateful for the extra preparation time the agreed extension offers to its members and advises them to use this time wisely to advance their No Deal preparations.

FTA, which speaks for the logistics industry, will keep pushing for the best outcomes for the sector, while continuing to support its members in their preparations and remaining vigilant to respond quickly should the situation change.

Efficient logistics is vital to keep Britain trading, directly having an impact on more than seven million people employed in the making, selling and moving of goods.

With Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. 

A champion and challenger, FTA speaks to Government with one voice on behalf of the whole sector, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers.  

• Alex Veitch, is head of multimodal policy for FTA. For more information on FTA please visit ww.fta.co.uk