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Exporters face ‘real test’ now as post-Brexit arrangements kick in

  • The deal established zero tariffs on European and U.K. products, but it has put up fresh barriers to the flow of goods, including new paperwork and customs checks.
  • The deal came into force on Jan. 1 and there have been only a few incidents so far when drivers did not have the right paperwork.
  • However, experts fear there could be delays and new difficulties as trading volumes increase later this month.

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Lorries are loaded onto one of the first boats to depart the port of Dover on January 1, 2021 in Dover, United Kingdom.Chris J Ratcliffe | Getty Images News | Getty Images

New year, new red tape: U.K.-based exporters are facing extra bureaucracy and costs in 2021 as they experience the post-Brexit trading arrangements.

The U.K. agreed to a new trading relationship with the European Union in December, having decided to exit the bloc after 47 years of membership. The deal established zero tariffs on European and U.K. products, but it has put up fresh barriers to the flow of goods, including new paperwork and customs checks. According to the U.K.'s tax agency, the deal with the EU adds £7 billion to the way of doing business.

"The real test of how ready we are for Brexit is going to come now as trade picks up again with the first proper trading week of the new year," Alex Veitch, general manager at Logistics UK, told CNBC's "Squawk Box Europe" on Monday.

The deal came into force on Jan. 1 and there have been only a few incidents so far when drivers did not have the right paperwork. In the port of Holyhead, in Wales, for instance, six freight loads did not have the necessary documents and were unable to cross to Ireland on Friday.

The lower-than-usual traffic due to the holiday season and the vast stockpiling in the run-up to the end of 2020 have contributed to the smooth flow of goods in the first few days of January. However, experts fear there could be delays and new difficulties as trading volumes increase later this month.

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