Almost a month ago, the Brexit trade agreement, which was literally fixed at the very last minute, came into force for the time being – problems are already mounting in foreign trade with Great Britain. Specifically, it is about the processing of exports. Most of the shipments are incorrectly declared. This is associated above all with additional administrative work that many companies – including Austrian ones – are now confronted with.
As it is said, a number of companies that were previously only active in the EU are not prepared for the current export and import registrations and the bureaucratic requirements associated with them. Incorrectly declaring shipments of goods has the consequence, among other things, that delivery times are extended and transport costs rise.
Customs agents are rare and expensive
What is more: Customs agents in the United Kingdom are, according to the Austrian economic delegate in London, Christian Kesberg, “in short supply and expensive.” Companies that do not have their own branch in Great Britain may need customs agents for imports, who “are currently not easy to find and charge exorbitant prices due to the high demand”. According to the Chamber of Commerce (WKÖ), the “serious bottleneck in the capacities of British customs agents” is currently offset by a business volume that has de facto increased fivefold overnight.
“Of course, the framework conditions have fundamentally changed for Austrian companies doing business in the United Kingdom,” says Mariana Kühnel, Deputy Secretary General of the Austrian Federal Economic Chamber. Nevertheless, “the United Kingdom will remain an important trading partner for Austria in the future”. Especially with many smaller companies that have little experience in third country business, the corona crisis management has overlaid the Brexit preparations, said Kühnel. With a view to the current problems, she appeals to companies to call up information, service and advice via the “Brexit Infopoint” of the Chamber of Commerce. “We stand by the companies with words and deeds,” emphasizes Kühnel.
UK customs are still untested
The WKÖ currently does not have a number on the Austria-wide share of incorrect declarations of consignments. According to the Styrian Internationalization Center (ICS), however, the proportion in Styria is 80 percent. It should be similarly high in all of Austria.
“Delays and incorrect declarations in freight traffic are among the long-foreseen aftermath of Great Britain’s departure from the internal market and the customs union,” explains Kühnel. “Know-how deficits regarding procedures and shipping documents at domestic suppliers and carriers in tandem with an untested British customs infrastructure actually lead to problem cases.” There are indications that carriers are refusing to accept consignments for the United Kingdom. At the same time, Austrian branches in Great Britain reported delays of several days in delivering goods and raw materials from Austria, says Kühnel. “Apart from the additional administrative effort”, the situation is “currently unproblematic” from their point of view.
Start-up problems overcome soon
In general, forecasts see the Austrian economy as being only marginally affected by the British exit from the EU; the talk is of an annual decline of 0.05 percent in gross domestic product. According to the Chamber of Commerce, the current start-up difficulties in the movement of goods should be overcome in three to six months.
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