UK businesses seek grace period to adjust to post-Brexit rules

London

BRITAIN'S biggest business lobby group has called on the European Union (EU) to delay introducing new customs checks after Brexit because firms have not had enough time to prepare amid the coronavirus pandemic.

The Confederation of British Industry (CBI), which represents 190,000 businesses, is also asking for companies to be given a grace period to comply with new paperwork that will be required at the end of the year whether or not the United Kingdom and the EU reach a trade deal.

With less than 14 days to go before Britain leaves the EU's single market, firms are still in the dark as to what the future trading relationship with the bloc will look like - raising the threat of widespread disruption on Jan 1.

"With time so short, both sides need to take steps to minimise disruption no matter the outcome," the CBI said in a report published on Friday, setting out its demands for business.

"Without them, much of the progress made recovering from the pandemic will be lost."

Asked whether companies will be given leeway to cope with new Brexit requirements, Cabinet Office Minister Michael Gove told Parliament on Thursday: "We want to make sure there can be a smooth glide path for businesses."

The UK government has said 7,000-truck-long queues could form around ports in a reasonable worst-case scenario because businesses have not prepared, threatening food supplies and causing havoc for just-in-time manufacturers.

Even if an accord is somehow struck, firms will have to prove the origin of their goods to benefit from tariff-free trade, and the CBI said companies should be given a one-year grace period to meet this requirement.

The CBI also called for a one-year easement which would allow UK products certified in Britain to be sold in the EU.

The UK government has consistently ruled out extending the Brexit transition period, but has taken unilateral actions - such as phasing-in post-Brexit import procedures over six months - to try to minimise the upheaval firms face.

The CBI is not alone in calling for more time to adjust. On Wednesday, the British meat industry said the government should negotiate an "orientation phase." BLOOMBERG