Oil and Gas UK (OGUK) has urged the UK Government to be “mindful” of any additional costs to the sector as it plans new Brexit customs charges.
Last week the UK Government published a border control plan, including £705m in new measures to prepare the country for leaving the customs union at the end of the year.
The move, with full controls in place at all ports from January 1st, means the number of required customs declarations is going to increase by around 245million, according to the British Chambers of Commerce.
Each declaration is expected to cost around £32, according to several newspaper reports.
OGUK said it is looking into the impact on the sector, which is already under “severe pressure” due to the downturn and Covid-19.
Supply chain director Matt Abraham said: “OGUK is working with our members and the UK Government to understand the implications of this for our industry.
“Our most recent survey of members underlines the concern over uncertainty on transitional arrangements.
“At a time when our industry remains under severe pressure from the operational impact of Covid-19 and low oil and gas prices, we continue to urge government to be mindful of any costs which could limit our ability to meet UK energy needs, support jobs and enable a transition towards a lower carbon future.”
The industry exports almost £12bn of goods and services annually, according to OGUK’s website.
Many parts of the energy sector had managed to grapple with changes related to Brexit in the run up to the start of the year, however the pandemic has brought severe financial strain to many, along with widespread job cuts.
The Scottish Government recently argued for an extension to the transition period, which would help provide stability for the industry.
Cabinet secretary Michael Gove made the announcement last week, along with publication of a 206-page border operating model.
An estimated 50,000 additional customs agents are needed to handle the additional requirement.
Russell Borthwick, chief executive of the Aberdeen and Grampian Chamber of Commerce, pointed to the UK chambers’ network for businesses seeking support.
He said: “With full border controls in place at all ports from January 1st next year, regardless of any deals agreed with EU nations this will mean an estimated 200 million more customs declarations needing to be made annually at a cost of £7bn.
“So, it is vital that firms who import from and export to the EU prioritise the appointment of customs intermediaries to advise on the next steps.
“With the government stating an additional 50,000 customs agents are needed to handle the additional requirements, there is currently insufficient capacity in this sector to meet the required demand.
“In order to avoid costly delays and enable trade to continue unhindered, businesses need to take action now to secure these services and the UK Chambers of Commerce network is well placed to assist.”
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