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Soapbox: Seeing red on Brexit

Published:  09 February, 2021

Cambridge Wine Merchants’ Hal Wilson calls for a united voice in the face of challenges posed to UK-EU trade by the Trade & Cooperation Agreement and the pointlessness of the dreaded VI-1 form

Independents will be feeling the downside of leaving the single market more than many. Gradually, with more and more horror, we learnt about the challenges post-Christmas eve, when the Trade & Cooperation Agreement (TCA) finally materialised.

This is not just about us, it’s about every industry. We’re all having to use Customs Handling of Import & Export Freight (CHIEF) for Customs declarations, an archaic system which is nearly 25 years old and predates the single market. It’s incompatible with the EU Customs Code and we’re still waiting on its replacement some two years after it was promised.

The wine trade is singled out for extra tough treatment, though. Come 1 July new wine import certificates will be required for all EU wine imports as part of the TCA. They won’t be Customs certificates and producers will have to produce them and have them stamped by their ‘competent wine authority’.

We need to put pressure on Defra and HMRC about VI-1s and import certificate forms and when a workable customs declaration service is going to be up and running. We need this pressure to be relentless and to come from absolutely everybody. The campaigning we did last year has brought some limited gains (full VI-1s not required), but there is still much to do to achieve anywhere near a satisfactory outcome.

I’m normally shipping one to six pallets from lots of producers. There are now extra requirements for producers if they want to sell to us, more information on the invoice they need to provide for Customs, all things they need to learn and understand to export wine to us.

But EU AoP, DO and IGT regulations already ensure health and safety standards in wine production, as do almost all countries, so why replicate this information and add additional red tape? Why then have to add the same information to another wine certificate for someone else to stamp? I really fear producers won’t put up with the requirements.

Added costs

And this adds costs. We’ve got £100 of red tape extra cost at least per shipment, for the export and the import documentation. Our freight agents have been doing a lot of the heavy lifting, providing us with information, but we are a business at the sharp end, because we need the wine, so we have had to share that extra information with the producers, which all adds to the burden.

Groupage is really tricky. If anybody gets the paperwork wrong, then that stock may not make it through. And if one pallet is wrong, then any other pallets on the consignment are also held up. Which means drivers parking up, waiting for the paperwork to be corrected. The freight agents are doing a hell of a lot of extra work looking at the paperwork, but they can’t employ people and do that work themselves, because there has to be a registered export company in the EU to do it on behalf of the producer. So the opportunities for delay are really legion.

If you are buying a container, you can wear £100 and probably tell the producer to cover that, which is playing into the multiples’ hands. It’s not so easy if you are buying in smaller quantities. So the increases in costs are going to be larger the less you buy. And this will affect smaller business more, as they will have less time and resources to understand the minutiae of the requirements.

With VI-1 and wine import forms, the trade needs to find the simplest way of explaining to people what they are and why they’re not fit for purpose. It seems nonsensical that we would adopt extra regulation [in July 2021] for UK-EU trade, and have imposed it on all non-EU trade. I don’t understand why, but DEFRA has said that going forward it will look at whether there is a case for adopting VI-1s or not.

Anyone with a brain can see that creating a Customs border where there wasn’t one, and then adopting EU trade barriers and red tape, is bad for trade when we import more than 99% of the wine we consume. And if there was one possible benefit to be had from leaving the EU, it would be negotiating better terms with non-EU countries, by dropping VI-1 forms to make trade easier with those countries – so they should be scrapped for all countries.

Why we’d want to put up new barriers for the EU and retain EU barriers for the rest of the world – that’s where there’s a case to answer.

It’s obviously time to move on from the result of the Referendum and people have had a greater threat to worry about for the past 12 months. ‘Boring’ Brexit hasn’t dominated the headlines – and that allows a bit more oxygen for talking about its consequences now.

The crisis wasn’t hitting us for the past four years, we were just predicting it. If Project Fear has become the reality people will listen more to what is happening, including people outside of the trade. But larger companies do need to help. CEOs need to put their signatures to anything the Wine & Spirit Trade Association or trade can do together. We will be a stronger voice if we pull together.

We’ve negotiated a treaty to make trade harder, and I don’t think that’s what British people voted for.

Please think about doing some of the following:

1. Keep your MP abreast of the changes to red tape now and from 1 July and how it affects you and the MP’s constituents

2. Make sure local media outlets are made aware of hold ups, costs, impacts and problems. They do seem genuinely interested in what it all means

3. Ask your social media followers to share your experiences. Warn them about increases in costs and that their favourite drink is being unfairly singled out for extra red tape

4. Try to keep your producers in the EU up to date with their responsibilities (the TCA is for all of us to deal with) for Customs export and import certificates. Ask them to put pressure on their governments too

5. Contact the WSTA about information available for your business, whether a member or not