On 14th October, in light of the ongoing shortage of lorry drivers (and the resultant pressure being placed on supply chains), the government launched a one-week consultation into the possibility of temporarily amending the current rules on cabotage journeys in the UK.
Cabotage is the transport of goods or passengers, between two places in one state, by a foreign operator. For example, if a Hungarian-registered HGV brought goods into the UK and unloaded them in Liverpool, then collected another load in Liverpool and transported that subsequent load to London, that second leg of the journey would be classed as a ‘cabotage leg’.
Given that the majority of cabotage journeys undertaken in the UK are made by Eastern European trucks operating at a lower cost than UK-registered firms, the practice has become increasingly regulated - the rules on cabotage have in fact been tightened further since the UK departed from the EU. Under the current UK regime, a foreign-registered vehicle is permitted to make just two cabotage legs within the UK within a seven-day period, before that vehicle has to leave the country.
Easing these restrictions on cabotage has been identified as one way of increasing the overall capacity of road freight operators in the UK. The proposal on which the government is currently consulting is to (temporarily) allow non-UK-registered vehicles to undertake unlimited cabotage journeys within the UK for a period of two weeks before they are required to leave – the only proviso being that they initially entered the UK with a load for import. The government is also seeking views on whether this extension should be limited to certain types of transport (for example food-related, or specifically moving goods from ports).
It is understood that, if approved, this relaxation of the rules would commence ‘later in the year’ and would remain in place for a period of up to three or six months, subject to ongoing review.
The move is intended to bolster UK supply chains in the run up to the busy Christmas period - it is estimated that the increased efficiencies achieved by permitting foreign operators to undertake unlimited pick-ups and drop-offs within the country for two weeks at a time will enable thousands of additional HGV deliveries to be completed over the course of December.
It is likely that it will be of particular benefit to supply chains involving food, and those which pass through UK ports (where driver shortages have resulted in containers not being cleared in time for new deliveries to be unloaded).
It comes as a further step to ease the current supply chain pressures which saw the implementation of temporary visas for non-UK national HGV drivers, which we reported on in our earlier blog.
Whilst measures aimed at easing the current pressure on UK road freight will largely be welcomed by suppliers, retailers and consumers alike, the move will not be without its critics. Leaders within the haulage industry including from the Road Haulage Association have already expressed concerns at the government allowing overseas operators to increase their workload in the UK, potentially undercutting UK operators who are facing driver shortages (and associated pressure to increase wages to attract drivers to plug the gaps).
The consultation closes on 21 October 2021 and we expect an announcement shortly after that date as to what changes, if any, will be made.
Please contact Roy Barry, Laura Darnley or Alexander Thow if you wish to discuss the above in the context of your business.
