Two-year-old Revenue document paints picture of hard Brexit
Study in 2016 in wake of British vote found serious challenges for Irish customs
Chairman of the Revenue Commissioners Niall Cody told the Oireachtas committee there would be “significant change” if there was a hard Brexit. Photograph: Alan Betson
Chairman of the Revenue Commissioners Niall Cody was very careful in his use of language about the consequences of a no-deal Brexit when he appeared before the Oireachtas Committee on Finance on Thursday.
He said the Government has made clear its overriding objective is to avoid a hard border on the island of Ireland.
However, the reality of a hard Brexit scenario, as has become evident in the past few days, is that all bets are off and some form of border arrangement cannot be ruled out.
Mr Cody told the committee there would be “significant change” if there was a hard Brexit, and that Revenue was focused on making sure there were systems in place to deal with legitimate trade in case of a no-deal Brexit. He also warned Brexit would bring significant cost implications for businesses involved in trade with the UK as a result of leaving the EU single market and customs union.
However, research conducted by Revenue two years ago paints a far more detailed, difficult scenario.
Soon after the decisive British referendum result in 2016, Revenue assembled a team of nine researchers to examine what implications it would have for borders and customs in Ireland.
It was a technical exercise – without a political prism – and the findings shocked the Government to the core. So much so that the work was jettisoned amid political fears that it might be a self-fulfilling prophecy.
The research was first highlighted by RTÉ’s European editor Tony Connelly in his book, Brexit and Ireland. It starkly warned that even with a “soft border”, certain controls were “unavoidable”.
That included as many as eight permanently established Border crossings, a raft of mobile Border patrols for the hundreds of unapproved roads to prevent smuggling, and an 800 per cent increase in the number of registered traders between Ireland and the UK. It also said the increase in customs checks among air and sea passengers arriving from the UK “would stretch existing customs control beyond capacity”.
Its net argument was this: it would be “somewhat naive” to believe that a new set-up for the Border could be arranged that was “different to any other land border in the world”.
It also predicted: “A number of designated and resourced crossings (as many as eight) will be required to meet the needs of legitimate trade and to satisfy our EU obligations.”
A technological solution that might address this problem was a number plate recognition system, similar to the one used on the M50. That would allow pre-declared goods vehicles to pass across the Border with the registration plate being caught on camera.
This would require the systems in both jurisdictions to be compatible with each other. Even then, in late 2016, the Revenue researchers were saying it was unclear whether any such system could be in place by 2019.
Moreover, they were not sure it would be permissible under EU rules. “One of the primary functions of an EU customs office of exit is to supervise the physical exit of goods from the union. Clarification would be required as to what extent a camera-based system could be considered to meet this.”
What was most contentious in the research for politicians, however, was the spectre of a physical border, be it fixed, mobile or technological.
With more than 30 million vehicular crossing each year, the researchers argued, “While some form of common travel area may exist post-Brexit, a completely open border is not possible from a customs perspective.”
The choice, it said, was between a hard border, as in the eastern frontier of the EU, and a soft border, as with Norway or Switzerland.
“Even in [Switzerland and Norway], certain controls are unavoidable; and a number of designated and resourced crossings will be required.”
With 3½ million air travel trips from the UK to Ireland each year, it would mean the number of people “potentially in possession of prohibited goods or with goods in excess of duty free allowances may exceed our existing customs control capacity”.
Permanent customs posts might be needed in smaller airports such as Knock, Kerry and Donegal for the first time.
There would be a similar requirement for scaling up for those arriving from the UK by sea. And with 12,000 vessels arriving at Irish ports each year, there would be additional requirement for freight and for roll-on/roll-off traffic.
The extent of the additional administrative burden of Brexit was also fully detailed in the research. Temporary importation is uncommon at present but Revenue believed in 2016, it would “likely see a major growth”.
It instanced the Ploughing Championship. “It sees a significant volume of equipment moved into Ireland from Northern Ireland and the UK for the duration of the event. If the UK were no longer in the EU, all of these products would need to be declared under the temporary importation procedure with guarantees of ATA carnets [passport for goods] required for the period of importation.”
It continued: “A further concern would be that equipment (eg, large construction equipment or even just tools) moves a few miles over and back across the border with Northern Ireland today.
“Given that these temporary movements would now be across the border of the EU customs territory, controls would be unavoidable.”
Goods being exported to the UK would also need to be covered by a pre-departure declaration to be lodged electronically at the customs office.
The EU rules on live animals and animal products are strict. In 2016, Revenue said they could only be imported at an approved Border inspection post.
“Customs cannot permit the release into free circulation of goods or animals not already cleared by the relevant co-located Border inspection post.”
The Dublin-Belfast rail link might also require a customs presence. Additional staff would also need to be recruited to deal with post arriving from the UK, which accounts for 50 per cent of all incoming mail. “We would need to increase the number of customs staff carrying out controls at the three postal depots by at least double to cope with these volumes.”
“18,000 parcels arrive in Portlaoise Mail Centre every week from the UK and Northern Ireland with 128,000 pieces of correspondence processed in Dublin Mail Centre,” it stated. Express couriers such as DHL, TNT, FedEx and UPS would also be affected.