Financial standing period of grace rises to a year

financial standing money

Operators struggling to meet financial standing requirements could now have a 12-month period of grace to get themselves on a firmer footing.

Laura Hadzik, solicitor at Backhouse Jones, said the maximum period had been extended by six months to 12 months “for assessments of inadequate finance made between 1 March and 30 September 2020”.

She added: “We understand that the senior traffic commissioner will be updating the statutory documents to provide further guidance on this in due course.”

Current guidance for operators on financial standing states: “Where a standard licence holder cannot demonstrate financial standing Regulation (EC) 1071/2009 allows but does not require the traffic commissioner to provide a period of time to rectify the situation.

“The operator may be given a limited time to make written representations before the traffic commissioner decides whether to allow time for rectification and for what period by way of a notice served under the legislation.”

James Backhouse, director at Backhouse Jones said: “The obligation to meet financial standing is mandatory so it’s important that if for any reason you can’t, you work up the strategy for meeting it, you notify the traffic commissioner of the position and you request a period of grace.”

A spokesman for the Office of the Traffic Commissioner said: “To help operators during the coronavirus lockdown, the DfT has temporarily relaxed EC 1071, enabling traffic commissioners to grant periods of grace up to 12 months.

“The Senior Traffic Commissioner will consider updating the relevant statutory directions as to how this will be applied in the near future.”

Illegal cabotage leads to refusal to return truck


A Romanian haulage company has failed in its attempt to have an impounded truck released after the traffic commissioner (TC) found it had previously been warned about illegal cabotage operations.

JIP International claimed it had not received a DVSA letter warning it against continued illegal cabotage after one of its vehicles was directed out of the UK in March 2019.

A traffic examiner impounded a lorry belonging to the firm in November 2019 after documents revealed it was performing its fifth cabotage operation since completing its incoming international journey in the UK eight days previously.

Regulations state that once goods on an incoming international journey are delivered, the operator may carry out up to three cabotage operations within seven days.

At a Birmingham hearing, JIP’s general manager, Zhalba Petar, told TC Nick Denton that he had not received a letter from the DVSA in April 2019 warning him about illegal cabotage.

The TC said it was possible the letter had gone astray, due to a spelling error in the town’s name. However, the DVSA’s traffic examiner said that when the firm’s lorry was directed out of the UK in March, the driver would have been given paperwork explaining why it was breaking the rules.

Petar told the TC his vehicle was a tractor unit and had been picking up trailers that had arrived from mainland Europe by ship at Tilbury and taking them to UK destinations.

In his view, these were international journeys and not cabotage.

But TC Denton considered previous decisions on this subject, which stated that a trailer can only take part in international carriage if it is coupled to a tractor unit.

Summing up, the TC said any company engaged in international haulage should be familiar with cabotage rules and JIP would have been in no doubt that picking up unaccompanied trailers from ports was cabotage work.

He refused the application and commented: “The company had already been informed in March that what it was doing was illegal.

“This decision will be notified to the applicant and to DVSA and it will be for DVSA to dispose of the vehicle once the 28 day period for appeal has ended