The U.K. government with aims to address one of the biggest challenges of Brexit, is planning to create a so-called inland port where imported goods can be checked without causing logjams at the coast, persons with the knowledge of the plan said.
Private negotiations are on
They also said that, private negotiations have begun and Her Majesty’s Revenue and Customs is in talks to rent a warehouse at Magna Park in Milton Keynes, about 70 miles (113 kilometers) from the coast and 50 miles northwest of London. As the negotiations are private, they did not want to reveal their identity.
Goods from the European Union could pass through customs there after the U.K.’s departure from the bloc.
Lease talks undisclosed
HMRC is talking to the owner of the property, Gazeley, about the lease, which is yet to be signed, the people said.
A spokesman for the European warehouse developer owned by Singapore’s GLP Pte declined to comment, while an HMRC official said inland customs checks are part of its “business-as-usual” activity.
E-commerce
The government’s plans for the Milton Keynes site come as demand for warehouse space booms in Britain, thanks to e-commerce, which now accounts for a fifth of retail spending excluding groceries.
Manufacturers including Rolls-Royce Holdings Plc warn they may be forced to hold more stock if Brexit impacts their supply chains, a trend that would stoke demand for warehousing further.
What next if trade disrupted?
“If Brexit disrupts trade between the U.K. and EU, then supply chains could become less reliable,” said Jon Sleeman, EMEA industrial and logistics director at broker Jones Lang LaSalle Inc.
“Some manufacturers or retailers may decide that they need to hold more inventory in the U.K. to cover for this uncertainty. This could lead to requirements for additional warehouse capacity.”
Post-Brexit concerns
The U.K. and EU are still negotiating a divorce settlement and there are concerns about post-Brexit congestion as customs checks are carried out at the border.
HMRC Director General for Border Coordination Karen Wheeler told lawmakers last November that Britain would need additional inland infrastructure to smooth customs procedures.
Evidence for inland port plans
There was further evidence of the government’s plans in a job advertisement posted by HMRC on Sept. 17. The ad said the U.K. is establishing two new “inland pre-clearance” sites “in order to meet regulatory requirements,” and that the job involves carrying out customs checks on goods before they’re cleared for import.
HMRC said it’s “committed to collecting and protecting customs duties and import VAT from potential fraud now and in the future, and we continue to evolve our response as new threats emerge. HMRC works in partnership with Border Force to undertake targeted checks inland as part of our business-as usual-activity.”
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Source: Bloomberg Quint
