Officials at the port of Rotterdam, the largest in Europe, are stalling on investments in Brexit infrastructure amid renewed hope that Theresa May will make a U-turn after the local elections on the UK leaving the customs union.

EU officials, however, have warned that global trade rules will stand in the way of a UK “fudge” on the customs union issue.

With the debate in full swing in the UK, officials at the port handling 40m tonnes of UK trade in goods annually said plans for the construction of new customs inspection posts, parking spaces and cool warehouses for flowers and vegetables were on hold.



Cabinet's Brexiters push May to drop 'customs partnership' Read more

While fearful that Brexit paperwork at the port could lead to five-mile queues of trucks on its doorstep, Mark Dijk, the port’s head of external affairs, said the level of the investment required by the the port and its ferry companies meant certainty was needed.

Dijk said: “It is all dependent on what kind of free trade agreement they work up and the customs union discussion which is interesting.

“After these local elections [next Thursday] then probably there will be some new discussions on the customs union, which might be very interesting for us because that solves the whole problem.

“It’s a very difficult decision, of course, because we don’t know what is going to happen and those investments are not cheap. And we do not know if they are possible.”

Dijk said there were concerns that the necessary land would not be available around at least one of the four ferry terminals servicing the UK, although he suggested Dover faced greater issues. “I saw in the UK they have larger problems with the infrastructure,” he said. “The port of Dover, which has got no space to grow, and other ports are pleading for public investment to facilitate this growth.”

Q&A What is a customs union? Show Hide A customs union means that countries agree to apply no or very low tariffs to goods sold between them, and to collectively apply the same tariffs to imported goods from the rest of the world. International trade deals are then negotiated by the bloc as a whole. For the EU, this means deals are negotiated by by Brussels, although individual member state governments agree the mandate and approve the final deal. The EU has trade deals covering 69 countries, including Canada and South Korea, which the UK has been attempting to roll over into post-Brexit bilateral agreements. Proponents of an independent UK trade policy outside the EU customs union say Britain must forge its own deals if it is to take advantage of the world’s fastest-growing economies. However they have never explained why Germany manages to export more than three times the value in goods to China than Britain does, while also being in the EU customs union. Jennifer Rankin

Last week, Bart Jan Koopman of the Dutch shippers and exporters’ organisation, Evofenedex, told MPs in the Netherlands parliament: “Our concern is on the British side. Their preparations are far from the level of the Dutch. This underestimation also applies to other EU countries. That can really cause chaos.”

The home secretary, Amber Rudd, is the latest politician to signal that the debate on the UK’s future customs arrangements with the EU is ongoing within the cabinet. Labour is seeking to force a change of policy in an upcoming Commons vote.

Roel van’t Veld, the Dutch ministry of finance’s Brexit and customs adviser, said that the scale of the investments and changes required on both sides, should the UK go through with Theresa May’s plan to leave the customs union, were well understood in the Netherlands.

Even with the signing of a free trade agreement between the EU and the UK, an extra 750 new Dutch customs officers will be needed, the first 150 of whom have just started their training, with selection proceeding for the second batch.

“We started collecting the statistics and they are rather frightening,” Van’t Veld said. “Trading between Southend and Rotterdam will be as trading between Rotterdam and Morocco, and people have to realise that. We have a huge number of companies that have no idea what trading outside the EU means. We have 35,000 companies trading with the UK who have no knowledge of customs. They are not known in our system.”

Even with “maximum facilitation”, a proposal by the UK for trusted trader schemes to reduce the necessary paperwork, Van’t Veld said there would always be companies outside such arrangements who would probably slow everyone else down at the ports.

Van’t Veld said he was advising the Dutch waste industry about the nine extra processes that would have to be followed for them to import British waste, in particular from Westminster from where a large amount of rubbish emanated, for treatment in the Netherlands.

In Brussels, EU officials said the was little clarity about the UK’s position following the rejection of the customs proposals made last year by the British government, which were designed to avoid a hard border on the island of Ireland.

Officials said they also expected a fresh proposal on customs from the UK after local elections, which would attempt to match the benefits of a customs union without it being described as such, to avoid a domestic row.

A senior official involved in Brexit negotiations warned, however, that World Trade Organisation rules would stand in the way of such a ploy.

The official said: “When they they come with a big fudge – custom partnership, customs facilitation, special customs arrangement – well, actually a fudge has its test and the test is article 24 of the WTO.

“If you give preferential arrangement with a third country outside a customs union, you have to apply it worldwide under the most favoured nation rule. Imagine if the arrangement doesn’t qualify as a customs union, they will have to open their borders to the whole world. They have no trade deals to negotiate any more.

“Whatever fudge they are brewing, it has to match the criteria set,” the official added. “Otherwise it is not a customs union and we end up with a free trade agreement, with the customs arrangements that you make with any third country.”

