Licensing of Operators and International Road Haulage (Amendment etc.) (EU Exit) Regulations 2019

Baroness Randerson Excerpts

Monday 18th March 2019 Lords Chamber

[Baroness Randerson (LD)]

My Lords, I start with the big question, as I see it: where does this dovetail with ECMT permits? We have already been through those in relation to an SI. They are already established as part of our no-deal preparations, and there has already been feedback on the fact that only 5% of the industry will be covered by them. So is this an either/or, or is it an either/or that kicks in after December this year? Perhaps the Minister could clarify for me exactly where this regulation stands in the whole thing.

In essence, and I say these words carefully, this SI substitutes a community licence applied for in the UK with a UK licence for the community. No wonder the public are beginning to get frustrated with the whole thing. Given that this applies to thousands of hauliers—thousands of small haulage firms, many with one or two vehicles—they could be forgiven for getting confused over this. That innocuous though confusing change of name hides a fundamental potential change in their rights to operate within the EU.

On Northern Ireland, I have very serious concerns about cabotage and cross-trade. Paragraph 6.5 of the Explanatory Memorandum makes several references to future arrangements in Northern Ireland. There is of course a great deal of cross-border haulage between Northern Ireland and the Republic. The situation is very nuanced because goods haulage is very different from passenger transport. What will happen to these arrangements if Northern Ireland is caught in the backstop? Generally these SIs say, “We’re sorting Northern Ireland separately”, but this one incorporates arrangements for Northern Ireland. That led me to wonder how it will operate if Northern Ireland is caught in the backstop. Am I right to assume that in that situation these arrangements would cease to apply?

Rather obliquely, paragraph 6.6 of the Explanatory Memorandum says that the amendments made by the SI also apply to coach and bus services, but paragraph 7.9 says that there is separate provision for international passenger transport. Could I have an explanation of that?

Importantly, regulation 1071/2009 allows member states some discretion to impose additional requirements of operators, and once again the Secretary of State is to get that power. I repeat my usual questions. What about transparency? On whose advice would the Secretary of State exercise this power? How would it be done? Would there be a role for Parliament? Would there be a negative or an affirmative process? I know I ask this every time, but I assume that the answer is different on each occasion.

Applications for Community licences currently go to the traffic commissioners. Will they maintain that role for UK licences in future? If so, what about resources? I am well aware that the traffic commissioners have a very broad responsibility and their organisations are usually extremely thinly staffed. There is the usual hope that the EU will continue to recognise our rights as usual, but there are EU proposals on this and, as I understand it, they do not give us full cabotage rights. They also extend only to the end of this year.

The Explanatory Memorandum says that it is hoped that this SI will be superseded by full legislation by the end of the year. As time goes on, the end of this year looks remarkably soon for there to be even more legislation on this. To clarify, is this EU offer for nine months after we leave for a rolling nine months following Brexit, which will kick in only when we leave, or has it offered this up to the end of this year and that is it?

Once again, there has been no consultation. That is especially serious in this case, because thousands of hauliers who make their living in international haulage will not be able to rely on a Community licence in future. This is not a minor change; it is fundamental. Again, SMEs are not especially taken into account.

Finally, if you currently have a Community licence, will you have to reapply for it? Suppose you have a Community licence that is valid to this end of this calendar year: are there any events or potential Brexit scenarios, foreseen or unforeseen, that could lead to hauliers having to reapply for their licence within that timeframe? Everyone expects that they will reapply for their licence at the end of the period covered, but is there anything that could happen that would interrupt that licence? Or are hauliers right, and can be confident to assume, that if they have a valid licence until the end of this year, for example, they can carry on working until then? I would be grateful for clarification on that.

[Lord Tunnicliffe (Lab)]

My Lords, I took a slightly more optimistic view of this SI than the noble Baroness, Lady Randerson. However, clarification in plain language will help. Paragraph 2.7 of the Explanatory Memorandum says:

“The UK operator licensing regime will generally remain as at present”.


I wonder whether we could have simpler language than that. My understanding, taken with recent agreement in the EU, is that the situation will be fully reciprocal. I will say it again, because it is a question to which I would like a direct answer. The Explanatory Memorandum uses terms such as “provided that”, which enthused me to look up the European Commission—I will not do this again. On 19 December 2018, it published a regulation of the European Parliament and of the Council on,

“common rules ensuring basic road freight connectivity with regard to the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the Union”.

At the end it says that the regulation applies until 31 December 2019, and that it was “done at” Brussels. I do not understand EU law. Is that now a piece of EU law? Does it, together with this SI, mean that in all respects, except the names of these licences, the situation for operators is identical to where we are now, with, of course, the overriding importance that the agreement of the EU is only until the end of the year?

--- Later in debate ---

[Baroness Sugg]

The Commission’s proposal includes the right for UK hauliers to complete point-to-point journeys and transit journeys. It also offers limited cabotage and cross-trade journeys. Cross-trade journeys are limited compared to what UK hauliers can do now, which is three movements in seven days. They will still be allowed to do two cross-trade or cabotage operations on every international trip for the first four months of these regulations, then one cross-trade or cabotage operation every trip during the next three months.

[Baroness Randerson]

Could I point out that this complexity underlines the importance of consultation and, therefore, public awareness? People in the industry could be forgiven for being confused.

[Baroness Sugg]

I agree with the noble Baroness. The EU has proposed a complex system. It has been clear that it is not replicating current market access provisions, but it is ensuring basic connectivity and phasing out the current system by the end of the year. However, given that UK hauliers are allowed to have these journeys, we do not expect the vast majority of haulage operations to be able to continue. We have ECMT permits to fall back on.

As I said, the measure is based on the UK granting reciprocal access. To protect businesses and minimise disruption, we are currently offering more to EU hauliers than the EU is offering us, so we are mirroring the situation at the moment. We have the power to amend this and mirror the EU’s offer. The regulation does not cover transit to third countries, but will cover transit to EEA countries such as Norway, so we will use the ECMT permits to those third countries. It also makes it clear that bilateral agreements with the UK can be negotiated and concluded for periods during which the regulation applies—for example, after December 2019—but should we be in a no-deal scenario and should these regulations come in, we will of course be negotiating at pace to understand our future arrangement.

If we leave the EU without a deal, we will not be able to issue Community licences, as we will no longer be a member state. Therefore, we have had to come up with a replacement document: the UK licence for the Community. UK hauliers should continue to carry their current Community licence, which lasts for five years. Only when a Community licence expires will it be replaced by the new UK licence for the Community.