BIFAlink June 2022

BIFAlink is BIFA's monthly magazine covering issues of importance for the logistics and supply chain industry.

June 2022 The magazine of the British International Freight Association BIFA link Issue: 382 Transitioning from CHIEF to CDS 6: News Outcome of Member survey on container shipping market 8: BIFA Awards BIFA Specialist Services Award winner YSDS 10: Policy & Compliance Government announces delays to final stages of implementing border controls INSIDE

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Robert Keen’s Column


BIFA seeks compensation for Members

BIFAlink is the official magazine of the British International Freight Association Redfern House, Browells Lane, Feltham TW13 7EP Tel: 020 8844 2266

In response to the government’s decision to postpone the next phase of the Border Operating Model, which was scheduled for implementation on 1 July, we have written to Jacob Rees-Mogg, Minister of State for Brexit Opportunities and Government Efficiency, to request that a mechanism be created to compensate the trade association’s Members for the financial losses that they have incurred as a result of making investments in IT and software, staff, premises and equipment, that are most likely not now going to be required. In the letter, we make it clear that BIFA Members have done exactly what

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(A company limited by guarantee. Registered in England: 391973. VAT Registration: 216476363) Director General Robert Keen Executive Director Robert Windsor, Policy & Compliance – Surface & Legal

government requested in order to facilitate the changes that result from the Border Operating Model. The letter reminds the government of the huge contribution that the freight forwarding sector has made in keeping the UK’s trade flowing during both the recent pandemic and the implementation of the Stages 1 and 2 of the Border Operating Model. BIFA believes that some form of compensation is entirely reasonable, and we are liaising with other sector trade associations whose members have been similarly impacted. A colleague recently observed to me that looking back to March 2020, coping with new COVID-19 restrictions was a lot easier than emerging from them. We quickly adapted to the necessity of re-engineering our services and communication methods to maintain our capabilities in providing dialogue and training to our Members. An ongoing dilemma for us is the return to face-to-face meetings, either around the UK or at the regular policy group meetings regarding Customs, Air, Surface Transport or Legal matters. The widespread adoption of video conferencing using Microsoft Teams or Zoom has enabled BIFA Members to simply ‘tune in’ for technical or legislative updates without leaving the office. This has been impacted by the huge surge of work in handling the consequences of EU Exit where BIFA Members have little free time. Our goal is to develop regular UK-wide updates on the information BIFA Members need, but we are mindful that many of you are looking forward to seeing each other again and we are working on ways to facilitate this. Freight forwarding growth Staying with the impacts of COVID-19, a recent article in the publication Transport Intelligence stated that global freight forwarding had grown by over 11% in 2021, the fastest expansion in a decade. Growth was led by air forwarding, which expanded at more than double the rate of the seafreight forwarding market and was driven by strong demand for goods, as well as supply chain bottlenecks in the sea and land transport. Of course, there are clouds on the horizon with inflation, the war in Ukraine and low consumer confidence denting the prospects for 2022. Certainly, empirical evidence from many BIFA Members is that they are extremely busy and the growth in the UK is mirrored by our membership growing to yet another all-time high at the end of 2021. We still lack clear direction from government, with the recent Queen’s Speech indicating possible changes to the Northern Ireland Protocol, which will no doubt bring further friction. Prior to the speech, the media suggested it would include widespread initiatives to ‘digitalise trade’ but this turned out to have been a red herring with nothing of substance apparent. The problem with ‘digitising trade’ is that there is no clear definition of what it actually means – and there are significant privacy and security issues. There is a deep mistrust of parties holding data and using it for other reasons. Currently, the belief is that CDS will be the platform, but given the time that CDS has taken to reach a position to be rolled out we have no idea how long this mooted digital development will take. Finally, face-to-face socialising in our sector seems to be returning with both the London and the Glasgow Freight Clubs holding events. It was also good to see the United Kingdom Air Cargo Club (UKACC) hosting its gala ball recently with a number of club stalwarts in attendance. At this point I would like to pay tribute to a former UKACC mainstay from the 1970s, Trevor Brading, who passed away recently aged 89. Trevor was my first freight boss at Airport Courier Services in 1970 after I left school. A really great manager who educated and mentored staff without ever needing to raise his voice. To conclude, I would like to invite any reader attending the forthcoming Multimodal 2022 event to call at the trade association’s stand in the BIFA Forwarders’ Village, where representatives from the Secretariat will be happy to discuss all the issues mentioned above, and more besides. Executive Director Spencer Stevenson Executive Director Carl Hobbis Policy & Compliance Advisor – Customs Igor Popovics Policy & Compliance Advisor – Air David Stroud Editorial Co-ordinator Sharon Hammond Communications Manager Natalie Pitts Membership Supervisor Sarah Milton

Published by Park Lane Publishing Contributors

Robert Keen, Robert Windsor, David Stroud, Spencer Stevenson, Carl Hobbis, Sharon Hammond, Natalie Pitts, Igor Popovics Note to media: If you wish to use items in this magazine that are older than one month, please contact the editor to ensure that the item in question still reflects the current circumstances. Please be advised that BIFA DOES NOT OFFER LEGAL ADVICE. BIFA is not a law firm and the authors of this publication are not legally qualified and do not have any legal training. The guidance and assistance set out herein are based on BIFA’s own experience with the issues concerned and should not be in any circumstances regarded or relied upon as legal advice. It is strongly recommended that anyone considering further action based on the information contained in this publication should seek the advice of a qualified professional.

Robert Keen Director General

June 2022



News Desk

Ian Matheson, from Impress Communications, reviews some recent news that might impact on Members’ business

warehousing the fastest growing sector of the UK economy. Warehousing is outpacing information and communication, noted a recent report from the Office for National Statistics (ONS). Real estate services giant JLL Inc estimates the average age of the USA’s industrial warehouse product

is 42 years, whilst buildings constructed more than two

decades ago account for three- quarters of the total industrial supply. More than a quarter of all inventory is over 50 years of age, presenting another headache for an industry struggling to find capacity, with existing designs often not adequate to meet the demands. IN BUSINESS Western ports and logistics operators are bracing for the impact of China’s COVID-19 lockdowns on their operations this summer. Officials expect a wave of containerships to reach the docks once China lifts stringent restrictions that have hobbled factory production, left a big backlog of goods in distribution pipelines, and caused a back-up of vessels off the country’s coast. Some 71% of UK logistics companies reported an escalation in the cost of transporting goods during the first quarter of 2022, compared with the same period a year ago, according to a recent survey. There have been sharp increases in the cost of fuel, along with other global supply chain pressures, resulting in 40% of respondents saying that costs had climbed by 25% or more.

USA takes a tougher stance on boxline profits

ON THE OCEAN Early May brought numerous

OVERLAND New provisions for hauliers serving music concerts, sports and cultural events mean they will be able to move their vehicles freely between Britain and the EU from late summer. ‘Dual registration’ is being created to allow hauliers to drive the same vehicle in Britain and abroad, and transfer their vehicles between operator licences without needing to pay additional Vehicle Excise Duty in Britain for six months. New EU rules effective from 21 May mean that anyone using light goods vehicles – such as vans, or vans/cars towing trailers – to transport goods for hire or reward into or through the EU, Switzerland, Norway, Iceland or Liechtenstein needs to have an International Operators’ Licence. GB Railfreight has celebrated the 20th anniversary of its inaugural intermodal service from the port of Felixstowe transporting goods across the UK for MSC. Today it runs 166 trains to and from Felixstowe each week. IN THE WAREHOUSE Record take-up, low vacancy rates and rising demand currently characterise the industrial and logistics real estate market, with

full visibility of container movement worldwide, enabling the earlier detection of delays and releasing automatic information to impacted customers. Almost a year after its launch in April 2021, and following a series of extensive sea trials and system tests, the 300 teu ZHI FEI, China’s first autonomous containership, has entered service. The vessel sails between the Shandong province hub port of Qingdao in northern China and the small port of Dongjiakou, some 60 km further south. It will provide proof-of- concept for (semi-) autonomous shipping and hybrid-electric vessel propulsion.

reports in the international trade media that the Federal Maritime Commission (FMC) in the USA is continuing to enhance its oversight efforts designed to scrutinise the business policies of the leading container shipping lines. This involves increasing the reporting requirements for those carriers and alliances which stand accused of profiteering from the supply chain crunch of the last two years. Container shipping line schedule reliability showed some small improvement in March, according to market analysts Sea Intelligence. Following a survey of the schedule reliability of over 60 lines across 34 different trades, Sea Intelligence reported that container line schedule reliability continued to “creep” upwards month-on-month in March to 35.9%, which is still below a year earlier. After introducing real-time monitoring of its reefer container fleet in 2019 with the IoT product Hapag-Lloyd Live, the shipping line will start installing the newly developed devices in all the standard containers in its 3 million teu fleet during 2023. This will provide customers with real-time track-and-trace data, giving them

IN THE AIR Global demand for air cargo

markets in March, measured in cargo tonne-kilometres (CTK), fell 5.2% compared with March 2021 (-5.4% for international operations), according to IATA. Whilst capacity was 1.2% above March 2021 (+2.6% for international operations), it was a significant decline from the 11.2% year-on-year increase in February. Contributing factors were the effects of Omicron in Asia, the Russia-Ukraine war and a challenging operating backdrop, along with a slower increase in capacity levels.

After one of the global freight forwarding market’s most

challenging years to date amid the COVID-19 pandemic, it bounced back strongly in real terms in 2021 growing by 11.2%, according to Transport Intelligence. This was the fastest growth rate since 2011, bringing the market value to €269,656 million.


June 2022




The biggest change in nearly 30 years is happening in our industry over the next  months.

CDS is replacing CHIEF for import customs declarations at the end of September 2022. In times of great change and upheaval, you look to who stands beside you and with you. ASM is guiding and partnering more than 500 freight forwarders through migration to CDS.

Who  s   partner?

ASM. Here today. Here tomorrow.

Let us know if you would like a conversation.


News Desk

New chair for the London Freight Club

Ian started IDT in 2006 having worked in the sector since 1985. He brings to the role a background of personal charitable activity which will no doubt enhance the good work undertaken by the London Freight Club. For more information visit Ian is pictured with BIFA Executive Director Spencer Stevenson at a recent event.

Ian Davids of International Distribution & Transport Ltd (IDT) recently took over as Chair of the London Freight Club, a role delayed a year by the Covid pandemic.

Outcome of Member survey: Understa nding the Current Container Shipping Market

The main complaints raised by Members concerned shipping line service levels, including historically poor schedule reliability and lack of space. In the UK, there have been numerous complaints about lines being slow in creating records, releasing documents, etc, to the clearance freight forwarder. A total 81% of replies highlighted that even where the shipping line or its local representative made errors causing a delay, it still billed additional charges such as storage and demurrage. Members were particularly aggrieved at the unwillingness of shipping lines or their local representatives to accept the commercial consequences of their own mistakes. Regarding the general competition question, 94% of respondents believed that withdrawing or amending contract rates was anti- competitive. Furthermore, 89% of replies believed that the shipping lines were negatively impacting their ability to supply freight forwarding services, and a very significant 100% believed that shipping lines should be subject to a regulatory review in the UK. A significantly more detailed analysis was sent to the CMA with a request for a review of shipping line practices, but it is too early to know whether such an investigation will be conducted. If an investigation is launched, the CMA will undoubtedly require significant amounts of accurate data to be submitted, which will either prove or disprove whether there have been breaches of competition law.

The survey will ensure that BIFA, in co-operation with other trade associations, can ensure that forwarders’ concerns and grievances are aired and heard

BIFA would like to re-iterate its thanks to Members who completed the survey on the current Container Shipping Market. This has provided the trade association with a useful overview of Members’ experiences and thoughts on this subject. Also, there was one perhaps overlooked but intriguing outcome to which we will return later. The reason for the survey stemmed from Member concerns regarding two main issues: the withdrawal of contract rates from a significant number of Members by certain carriers and the reduction of the space available to others benefiting from contract rates. These actions led to numerous complaints from freight forwarders across the globe. BIFA has co- operated with other trade associations such as FIATA and CLECAT to ensure that forwarders’ concerns have been aired and heard. In the UK, BIFA engaged firstly with the Department for Transport and latterly with the Competition and Markets Authority (CMA) on the subject. International working group established The complexity of the issues are not to be under-estimated.

Zealand Commerce Commission. In the US, led by the Federal Maritime Commission, authorities have been particularly active in monitoring shipping line activities. At this point in time, it has to be stated that regulators have found no evidence of shipping lines breaking competition law in any jurisdiction. BIFA has written twice to the CMA regarding shipping line conduct, on the second occasion submitting the outcome of the survey.

Unexpected outcome The first and perhaps most

Shipping lines as carriers operate on a global basis, whilst in specific locales they are likely to be represented via a ship’s agent or logistics company, often with the parent company’s name. For regulators with limited territorial jurisdiction, co-operation is key and BIFA welcomed the establishment of a working group of international competition authorities that will meet to monitor potential anti-competitive conduct in the maritime sector The working group is made up of competition authorities from the ‘Five Eyes’ nations: the UK Competition and Markets Authority (CMA), the US Department of Justice, the Australian Competition and Consumer Commission, the Canadian Competition Bureau, and the New

important point to make is that 97% of all survey respondents classed themselves as either a small or medium-sized freight forwarder. The responses to the questionnaire produced an unexpected outcome – not as many Members were concerned about the withdrawal of contract rates and limiting of capacity as expected. A total 80% of French freight forwarders had raised concerns on this issue; however, amongst BIFA Members only 56% cited this complaint. Some commented that due to their size they had never benefited from ‘contract rates’, therefore this change in shipping line policy had no impact on them.


June 2022

News Desk


BIFA’s Young Forwarder Network gets back on track

cutting-edge systems and technology. During his talk, Ackers gave guests an overview of his career, which started in the warehouse at Birmingham Airport. When asked about advice for young people starting out, he responded that he had a ‘passion’ for aviation – living close to the airport as a child – and he still has it now. “Whatever you do, do it with passion”, he said. Carl Hobbis, executive director, BIFA, said: “The Heathrow event was our 73rd YFN event and it felt good to see some of the established young forwarders again, as well as some new faces who have all started their careers since the pandemic, at both events. “The working world is different now, but I would encourage employers to see the value in these free events and give employees time to attend. At them, young people will build knowledge, increase their confidence, and learn something new and bring this back to the business – guaranteed.” BIFA has been running popular virtual YFN events every two weeks and these will continue, but they will move to every three weeks now that we have restarted the regional events. In May there were more face-to- face events in Manchester (11th) and in Anglia (24th) – photos and a write-up will be available in the next issue of BIFAlink . You can find a listing of all future events at

One year after being formed, BIFA’s Young Forwarder Network (YFN) face-to-face events came to a grinding halt at the start of the pandemic, like almost everything else. Two years on and the association, working with the regional organising committees, has been determined to get these valuable networking events re- established as part of a regular events calendar. In April two events were held. The first was in the Midlands region when guest speakers from Kuehne+Nagel, the official logistics provider for the Birmingham 2022 Commonwealth Games, gave a fascinating insight into the logistics and operations around the biggest multi-sports event in the UK since London 2012. Andy Blundell and Alex Walton explained the differences between deliveries and timelines to a high- profile event versus normal day-to-day shipments. They also shared their experience of event logistics from Delhi 2010, London 2012 and Glasgow 2014, as well as from a host of other events around the world. The very next day, YFN members from the Heathrow region gathered to network and hear from Mohammed Akhlaq (Ackers), chief commercial officer at dnata, who gave a presentation entitled ‘dnata City: from concept to reality’. Founded in 1959 and employing

From left to right: Sophie Hammond, Mathew Harvey, Mohammed Akhlaq, Bobbie Costin and Thomas Frost

From left to right: Nathan Ainsworth, Georgia Sumner, Andy Blundell and Alex Walton

34,000 people around the world, dnata currently handles 7,300 tonnes of air cargo daily, which equates to 2.6 million tonnes annually, 706,000 tonnes of which are handled in the UK at 13 cargo facilities.

In 2014, the dnata city development began at Heathrow to replace out-dated and cramped sheds with purpose-built and tailor- made modern facilities incorporating the vision to be “better by design” and utilising

The Limits of Liability for Carriers

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BIFA STC: (2 SDR): £2.17 per kg

By road – CMR (8.33 SDR): £9.04 per kg

Insurance for the Marine & Logistics industries

(The SDR rate on 11 May 2022, according to the IMF website, was 1.085)

By air – Montreal Convention (22 SDR): £23.87 per kg

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June 2022



BIFA Awards


trained to ship lithium batteries compliantly. “There are rigorous checks before a flight and if these are not satisfied then batteries can be sent back to the shipper,” she continued. “The worst-case scenario would be a fire breaking out; if a non-compliant shipment does somehow reach its destination country, there would be fines and the batteries could be detained or destroyed.” Unusual challenge Another challenge stems from the highly unusual nature of the scaled-down, replica vehicles that YSDS transports. Briggs explained: “These cars cannot be driven on roads, so they do not need all the usual car permits – but Customs officials will occasionally stop them because they do not understand that.” This happened more frequently when YSDS first started shipping the vehicles, but over time it has occurred less and less. YSDS completes as much work as possible in-house, but it does also rely on trusted partners and haulage companies with specialist vehicles and car transporters. It vets all agents and contractors before engaging them and has a dedicated quality assurance team. “We can offer a range of solutions based on the end customer, its budget and its specific requirements. We have shipped vehicles in large car transporters fitting six cars on the truck, down to vans with ramps when the client prefers an ‘economy’ service,” Briggs added. No matter the price point, daily communication is vital in order to ensure all parties are fully informed of any updates or movements, Briggs noted. YSDS adopted the same messaging system that its client uses to conduct its business. For this reason, YSDS has appointed two dedicated account managers to support this exciting client and its global shipments. “Keeping a great relationship with the client is our main priority and something we pride ourselves on,” she said. Newage is a Global Freight Forwarding SaaS company, focusing on automation in supply chain management, logistics,and freight forwarding industries. Newage has more than 350 customers across 30+ countries, handling more than $500 million annually in shipments. Our flagship software, eFreight Suite, works as a one-stop global freight forwarding software for forwarders.

A high-performance vehicle being loaded into a transporter, similar to the type of operation carried out by YSDS Geared up to meet niche requirements

YSDS focuses on key types of cargo and takes a consultative, collaborative approach to working with clients. As a result, it can provide tailor-made logistics solutions and, for this, it won the 2021 BIFA Specialist Services Award

“We are a modern, fast-paced forwarder with a new perspective. We see ourselves as specialist brokers rather than general forwarders,” said Hannah Briggs of YSDS’ operations and compliance team. “At YSDS our mission is to move the world’s most valued goods to any location with exceptional service and care. We specialise in three main industries: life science, art and specialty logistics. The type of goods we ship ranges all the way from, for example, cancer treatment drugs to high-value fine art and electric-powered cars. The red thread is that all our shipments require special handling and expertise for successful transportation.”

Hannah Briggs: our mission is to move the world’s most valued goods to any location with exceptional service and care

Customs requirements and ad hoc routing options for replicas of luxury cars.

A significant challenge in shipping these vehicles relates to the 48V lithium batteries that power them. Briggs said: “Most carriers do not want to take lithium batteries, so forwarders need to use special routings and have special licences (DG licences), as well as training in packing and labelling dangerous goods. Our global YSDS team is

Car industry It was the car industry that featured in the company’s BIFA Award submission. YSDS has worked closely with its client throughout the past two years, providing a full

service and shipping reduced-scale luxury vehicles to prestigious clients worldwide. The service included documentation, licences,


June 2022




Policy & Compliance

Government announces delays to final stages of implementing border controls

Jacob Rees-Mogg, the Minister for Brexit Opportunities and Government Efficiency, made a written ministerial submission to parliament on 28 April 2022 detailing further delays to the implementation of the final stages of import controls on EU goods entering the UK. The statement reads: “It would therefore be wrong to impose new administrative burdens and risk disruption at ports and to supply chains at this point. The remaining import controls on EU goods will no longer be introduced this year – saving British businesses up to £1 billion in annual costs.” In a subsequent conference call with trade, the minister re-iterated that the main drivers for the change of policy were the increased cost of living and the disruption resulting from the war in the Ukraine. Unchanged policies Many Members have been commenting for some time that whilst the UK has left the EU, we are still following most of its Customs policies and procedures. For ro-ro it has been noted that, if all the controls were introduced, three separate systems would have to be utilised to declare standard goods – CHIEF/CDS, GVMS and S&S GB. On behalf of its Members, BIFA has been asking government to consider using the data, for instance, in the pre-lodged Customs declaration as satisfying the requirement to submit an import safety and security declaration in the ro-ro environment. Effectively the UK is pausing the introduction of the next phases of the planned frontier controls with the EU to allow the review of procedures applied to global traffic – this will include both EU and rest-of-the-world trade. It is believed that this review will lead to the development of new policies which, when introduced, will be different to those envisaged in Effectively the UK is pausing the introduction of the next phases of the planned frontier controls with the EU to allow the review of procedures applied to global traffic

the Border Operating Model. These new procedures will be designed for all trade. The minister states: “This new approach will apply equally to goods from the EU and goods from the rest of the world. It will be based on a proper assessment of risk, with a proportionate, risk-based and technologically advanced approach to controls. This includes the Single Trade Window, which will start to deliver from 2023, the creation of an ecosystem of trust between government and industry, and other transformational projects as part of our 2025 Borders Strategy.” The 2023 date is significant, because that is when the new Customs Declaration Service (CDS) is due to be fully deployed to trade for both import and export traffic. Some, including BIFA, have already suggested that the new system should be the cornerstone of the Single Trade Window. From a purely operational viewpoint, BIFA Members have to be aware that the controls already introduced will remain in place. However, the following controls, which were planned for introduction from July 2022, will now not be introduced: • A requirement for further sanitary and phytosanitary (SPS) checks on EU imports currently at destination to be moved to Border Control Post (BCP). • A requirement for safety and security declarations on EU imports. • A requirement for further health certification and SPS checks for EU imports. • Prohibitions and restrictions on the import of chilled meats from the EU.

of both Houses of Parliament in due course. In autumn 2022, the government has undertaken to publish a Target Operating Model, which will set out the new regime of border import controls as part of the 2025 Borders Strategy. This is an ambitious timeframe and it is to be hoped that government will remember one key lesson from EU Exit: to consult with those who currently make the frontier work and devise policies based upon what will actually work in practice. Whilst technology is important, the human element and market structures also have to be taken into account when formulating policy. It is to be hoped that unlike certain processes included in the BOM, such as those relating to the haulier having to file the import safety and security declaration, all the new policies will be of a practical nature that can be quickly implemented by the current supply chain participants. Timeframe challenges Also, given the ambitious nature of this schedule, one point that springs to mind relates to any additional legislation that might be required and how the time will be found to draft and pass it through parliament within the relevant timeframes. BIFA will ensure that its Members’ views are presented to government in any consultations, but some of the issues are complex and will take time to resolve. If there is one plea to make to this government, it would have to be that this will be the last time for the foreseeable future that such significant change is imposed. What this sector needs, at a domestic level at least, is a period of stability to enable it to recover from various significant events in the last five years.

The Border Operating Model will be updated to reflect this, and a copy will be placed in the libraries


June 2022


Policy & Compliance

Transitioning from CHIEF to CDS The Customs intermediary sector is facing a huge upheaval with the transition from CHIEF to CDS. Here BIFAlink explains the scale of change that the sector is facing and the need for early and thorough preparation

Having looked back on some internal records, the first note we have on the Customs Declaration Service (CDS) is dated 26 September 2013. Therefore, it has taken nine years of planning and work on the new system to reach this point where it is being phased in by HM Revenue & Customs (HMRC).

The Customs Handling of Import and Export Freight (CHIEF) system will be shut down on 31 March 2023. Going forward, when submitting either an import or export Customs declaration, Members will have to do so via CDS. In the foreseeable future it will become the UK’s single Customs platform.


June 2022

Policy & Compliance


CHIEF is essentially a data processing system supported by paper documents and authorisations. CDS, which links to the

noted, and recent downtime issues indicate, CHIEF needs to be replaced with a more stable and secure Customs platform. Additionally, CDS will allow the UK to utilise a platform that can be updated to facilitate changes stemming from the Border 2025 project, which aims to create a Single Trade Window for trade to communicate with government. There have been some declarants who have been using CDS for some time, primarily for supplementary declarations, whilst Members based in Northern Ireland have been using the system for frontier declarations since 2021. First steps in preparation Moving from CHIEF to CDS is a significant step and requires careful planning. The system is more complex, particularly because certain functions must be undertaken first on the Government Gateway and then linked to CDS. Some software houses have linked certain functions directly from their software to the Government Gateway to simplify the process – the commercial software is in effect the front end and you will need to check with your software provider for their plans. It is strongly recommended that you also contact any Community Service Provider (CSP) you hold a badge with to discuss the transition from CHIEF to CDS. Our first suggestion is for Members to internally devise an implementation plan, with your main priority being to determine who has access to the business’s Government Gateway and decide protocols for operational staff to access this system. You will need to authorise individual users to operate CDS and also, for instance, authorise the use of the deferment account by another agent. HMRC has published guidance on some steps to be taken: Get access to the Customs Declaration Service – GOV.UK ( There are also some example declarations: for-imports-to-great-britain-from-the-rest-of-the-world As already suggested, Members should have a conversation with both their software provider and Community Service Provider (CSP) about how they can support the migration from CHIEF to CDS. Software providers have put great effort into developing software, which makes using CDS and generating Customs documents, such as the C88 and E2 which customers will want, as easy as possible. Another point to check is that your company’s details, including e-mail addresses, are up to date on the business tax account, as these will be needed to keep users updated. There are some significant changes to payment methods between CHIEF and CDS; for instance the Flexible Accounting Scheme (FAS) in CHIEF is replaced by the ability in CDS to top up a deferment, top up a cash account or pay directly using a credit/debit card or bank transfer. If you use a duty deferment account, either for declaring your own imports or on behalf of another business, it is essential that the duty deferment account holder completes a new direct debit instruction to use CDS. This will ensure payments are made to the correct bank account number. Only those registered to use CDS and acting as the official deferment account owner will be able to view deferment account statements and certificates. Whilst CHIEF is still operational, it is important not to cancel your original direct

Government Gateway, has become a Customs management system.

HMRC has advised that CHIEF will be withdrawn in two stages: • After 30 September 2022, it will not be possible to make import declarations on CHIEF. • From 31 March 2023, CHIEF will be closed to export declarations as well. The new system marks a considerable change from its predecessor and, in all probability, from what had been envisaged in 2013. CHIEF is essentially a data processing system supported by paper documents and authorisations. CDS, which links to the Government Gateway, has become an electronic Customs management system. Certain information has to be input into the Government Gateway; for instance the importer has to authorise the Customs agent to use the former’s deferment approval number. CHIEF appears to be coming to the end of its working life and it has to be remembered that originally CDS was conceived when the UK was a Member of the EU and change was needed to ensure compliance with the Union Customs Code (UCC). Some have questioned whether, in view of the UK leaving the EU, this change is still needed? The answer is that the UCC was based upon World Customs Organisation (WCO) guidelines and the UK still has to ensure that its systems comply with that organisation’s criteria. As we have already

Continued on page 14

June 2022



Policy & Compliance

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will have to be obtained from clients to complete a Customs declaration; for example, an import entry in CHIEF requires a maximum of 58 boxes to be completed. This rises to 76 data elements in CDS. One other significant change is that the C88 and E2 are combined into a single Movement Reference Number (MRN) document. e-learning course BIFA, in conjunction with ASM UK, has created an e-learning course ( declaration-service-online-cm1cbt?l=y) detailing the differences between the two systems and this is suitable for personnel already familiar with Customs entries in CHIEF. Our final point is that once Members have registered for CDS and discussed with their software suppliers, they should consider registering to be part of the Trader Dress Rehearsal ( service?msclkid=28404e82c6f111ecb34b03ef72c6ce50). This will allow the preparation and submission of Customs declarations in a test environment, without data being submitted to HMRC. Member feedback is already suggesting that declarants using this facility find going live on CDS considerably easier. If nothing else, it is hoped that this article will raise awareness of the need to prepare for, and the scale of, the change facing the Customs intermediary sector. BIFA will communicate via its website and encourage Member engagement with HMRC via any events that the department hosts.

Continued from page 13

An import entry in CHIEF requires a maximum of 58 boxes to be completed. This rises to 76 data elements in CDS.

debit instruction. It will still be needed for deferred declarations you make via CHIEF, as well as Registered Excise Dealer and Shipper (REDS), Alcohol and Tobacco Warehouse Duty (ATWD) or VAT 908 payments. If you cancel it, your payments could fail. Until CHIEF is switched off you will have two active HMRC direct debit instructions (one for CDS and one for CHIEF), and two payments may be taken on the same day, one to settle your CDS liabilities and another for CHIEF. If this happens, you will receive two statements to confirm charges due. For BIFA Members, it is essential to engage with your customers and explain this change to them. In addition, every agent declaring imports on behalf of the importer must be granted authorisation by the customer via the CDS account in order to allow the agent to use the customer’s deferment or cash account. Training and support Also, it is important to consider what training and support staff will need in order to become fully conversant with CDS. The language is new – for instance box numbers are replaced with data elements. With regard to these new skills, it is important for Members to familiarise themselves with new documents such as the new CDS Tariff ( for-cds--2?msclkid=c732d9cbc6ef11ec8732e7e8a6d7393e), which includes all the Customs declaration rules and guidance. Also, it will be necessary to consider what additional data


June 2022

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Policy & Compliance

The digitalisation of bills of lading

Established to further the digitalisation of container shipping technology standards, Digital Container Shipping Association (DCSA) – a neutral, non-profit group – in conjunction with its nine member carriers, announced in February 2022 the formation of the Future International Trade (FIT) Alliance with the signing of a memorandum of understanding (MOU) between DCSA 1 , ICC 2 , BIMCO 3 , FIATA 4 and SWIFT 5 , in which the organisations commit to collaborating to standardise the digitalisation of international trade and facilitate the use of electronic bills of lading. The bill of lading, a document that illustrates title to goods, is considered the most important document in international trade and for centuries has existed as a paper document. Digitalisation of the bill of lading has been the subject of conversation for several years, with the advantages and disadvantages debated by many. The formation of the FIT Alliance will hopefully facilitate acceptance and adoption of an electronic bill of lading by regulators, banks and insurers and assist in unifying communication between these organisations and customers, physical and contractual carriers, and all other stakeholders involved in an international trade transaction. The reliance on paper versions of shipping documents, including the bill of lading, has its Five industry associations have launched the Future International Trade Alliance (FIT Alliance) and signed a memorandum of understanding seeking to standardise the digitalisation of international trade. Together, they hope to collaborate on the development and adoption of relevant standards to facilitate the use of electronic bills of lading

drawbacks. The process of preparation and checking takes time, which inevitably costs money. Goods can reach the port of discharge before the shipping documents have made their way through all parties in the transaction, causing delays at ports with resulting detention and demurrage charges quickly accruing. Consequently, the release of cargo is sometimes subject to a signed letter of indemnity instead of the bill of lading, which has its own issues including negotiation time and the risk of litigation further down the line involving consignees, shippers and freight forwarders. An accelerated digital process should reduce these risks and will benefit all parties involved in the movement. Reducing fraud Moreover, the paper bill of lading is open not only to errors, but also forgery. Digitalisation could significantly reduce fraud, which in turn will create greater trust among consignees and shippers and reduces the risk of carriers’ exposure to claims for misdelivery against a forged bill of lading. However, the development of technology has progressed slowly, reflecting resistance to move forward, without careful consideration of the disadvantages. The technology must enable the secure transfer of e-bills to combat the increased

sophistication of cybersecurity threats, which is one of the main areas of resistance to digitalisation. In addition, the technology needs to be adopted worldwide. There are now several solutions available. WAVE BL, a technology company offering electronic bills of lading, claims that its blockchain-based platform imitates the traditional paper-based process. Shipping companies such as MSC (Mediterranean Shipping Company) and most recently, Hapag- Lloyd, have partnered with WAVE BL, in a move to go paperless. Distributed ledger technology (also referred to as ‘blockchain’ technology) has played a substantial role in the enablement of e-bills, as it ensures that they are able to perform their role as a document that is capable of being used to evidence title in goods, evidence of the contract of carriage and also a receipt. Another disadvantage is that the legal status of e-bills across the world and a global framework do not yet exist. However, countries are beginning to legally recognise the status of e-bills. For example, in February 2020 Singapore passed the Electronic Transactions (Amendment) Bill and became one of the first countries to enact legislation that recognises the use of e-bills. Spain has also adopted a similar framework by virtue of the Maritime Navigation Act 2014.


June 2022



English law does not currently recognise ‘possession’ of electronic documents and, therefore, does not recognise an e-bill as a document of title. However, the England and Wales Law Commission has released its consultation into global electronic documents. The consultation also includes proposals to allow for such documents to be recognised under English law as tangible assets capable of possession and therefore, by extension, to recognise e-bills as valid documents of title. The Law Commission’s proposed criteria for an electronic document to be considered capable of being ‘possessed’ under English law, is as follows: 1. It exists independently of both persons and the legal system – in other words, it is not a bare legal right; 2. It is capable of exclusive control by only one person at any one time; 3. It is fully divested on transfer, such that the transferor can no longer control the document. Possession The Law Commission also considered what constitutes possession and transfer of possession. It was determined that whoever has control over the electronic trade document is deemed to be in possession of it. Therefore, transfer of possession occurs when the transferee gains control over the electronic trade document. The Law Commission invited stakeholders to respond and its project is currently at the policy development stage. Overall, it is estimated that the use of e-bills will save the industry billions of US dollars per year and is welcomed by many. Faster transactions will reduce the risk of extra freight charges, which will benefit cargo interests. Shippers will also benefit, as the quicker a customer receives its cargo the quicker it will pay. The reduction in fraud will also benefit all parties within the transactional chain. The formation of the FIT Alliance will no doubt be central in pushing the matter forward both globally and at the local level. BIFA would like to thank Hill Dickinson for allowing the reproduction of its original article in BIFAlink. 1 Digital Container Shipping Association 2 International Chamber of Commerce 3 Baltic and International Maritime Council 4 International Federation of Freight Forwarders Associations 5 Society for Worldwide Interbank Financial Telecommunication

Freight and Customs training still proving extremely popular

Book your training now as courses are in high demand

With a relentless appetite for Customs training and a steady flow of new apprenticeship starts, our freight and Customs training courses are now booked-up months in advance. Carl Hobbis, executive director with responsibility for training, explained: “Our training has built up a reputation for being relevant for the day-to-day knowledge needed and the feedback we receive from our sessions is incredibly positive. “It is particularly encouraging to see the number of apprentices starting in the industry pick up after the huge effect the pandemic had on youth employment. “The apprenticeship training providers tend to book their learners well in advance, so they get in first, as it is part of a wider programme. So, my message to Members is not to leave it too late.” “We are putting on more face-to-face courses in Heathrow, Manchester and the Midlands, with feedback confirming that learners get so much more out of this method. However, the

more demand, as we want to see our Members employ more young people through the apprenticeship pathway. “With this extra resource, we have just added extra dates for Q3 & Q4, but if you have enough employees we could even come to your premises as well.”

For course information scan the QR code or for apprenticeships contact Carl Hobbis at

convenience of remote learning is still a draw for employers and is how most of our training will be delivered this year.” He added: “We have also invested in an extra trainer; Lisa Rose joined us in January, to cope with the increase and what we hope is even

June 2022


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