AGENCY SECTOR MANAGEMENT CHAIRMAN WARNS OF TRADE CHAOS

The head of the freight industry's leading software organisation warned importers, exporters and forwarders to brace themselves for major disruption when Customs switch over to a new system on July 1st, this year.

Peter MacSwiney, chairman of Agency Sector Management (UK) Ltd, warned a conference at ASM’s headquarters near Heathrow that current plans to implement new regulations, based on the new harmonised SAD (Single Administrative Document) could lead to a disaster as freight forwarders and their staff grapple with completely unfamiliar customs declarations and largely untested software.

Instead, he is urging HM Revenue and Customs to think again about cutting over the industry en masse to the new system on July 1st and instead to adopt a phased approach, migrating communities to the new system when they are satisfied that the new software is working properly and that staff have been properly trained and familiarised with the new procedures.

"The problem is that, under the new system, the current customs declarations won't be accepted any more. HMRC’s original plan was to run the old and new systems together between March and July, giving forwarders the ability to adapt to the new procedures and uncover any defects of the new system along the way. Having both systems available was a far more pragmatic approach compared to the prospect of a cutover to a new system overnight.

“Staff training was another issue,“ he added. "If we were to train people now, would they still remember it in July?"

He added that freight forwarders might have to demand much more precise information from shippers, possibly at an earlier stage of the shipping process, than was currently the case.

While the nature of the proposed implementation is such that individual freight forwarders would all have to make the change literally overnight, many difficulties could be avoided and the risk of failure greatly reduced if they made the switch in batches rather than every company in the country switching over on the same day. Peter MacSwiney added that if such an approach was adopted, "a two or three month transition period, although still difficult, would be achievable."

The alternative, he warned, might be a complete collapse of freight movements into and out of the country on a scale not seen since the ill-fated introduction of the Travicom system in the 1980s. Unlike Travicom, which affected mainly airfreight imports, problems would affect exports as well, across all modes of transport.

The new harmonised SAD (SADH) is an EU initiative as a precursor to allowing declaration data to be passed between Member State’s computer systems. It includes numerous new data elements and codes and item-level manifest information, all of which could involve more manpower to input the required information.

The UK is in fact somewhat behind the rest of the EU in implementing SADH, ironically because it already had the most sophisticated customs IT systems. This has made the task of integrating the new requirements much more complex than in countries where such systems were rudimentary or non-existent.

“Other EU initiatives will be following ‘hot on the heels’ of SADH. These will introduce new EU-wide controls, including both Export and Import Control Systems (ECS and ICS) and will add significant complexity, involving either completely new systems or major enhancements of existing ones,” he added. These will require summary declarations to be provided (for safety and security purposes) in addition to current customs declarations, well in advance of goods entering or leaving the EU.

It is very likely that air and shipping lines and other carriers would refuse to carry shipments where information was incomplete as they could be subject to heavy fines - in much the same way as airlines already are if they carry passengers with incomplete travel documents into the country.

ASM provides outstanding software and unparalleled support to the freight industry.

We are a not-for-profit company limited by guarantee and owned by our users. The ASM board is made up of working freight executives who perform their duties voluntarily.

Without the need to satisfy shareholders we are uniquely placed to deliver the most cost effective solutions available in today's marketplace.

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- Ian Matheson

This release was published on openPR.