|Please find below the latest updates from Government regarding Brexit:
Withdrawal Agreement Bill:
The EU parliament needs to ratify the Agreement Bill before it can be implemented. Both the EU and the UK government are confident that ratification of the Bill will take place by end of the month and we will formally leave the EU on 31 January.
The Government remains clear that an extension will not be requested, including this principle in legislation.
No Deal work has been stood down, but there remains a risk that it may need to be resurrected again towards the end of the year if a trade deal with the EU has not been agreed.
During the Implementation Period (i.e. until 31 Dec 2020) our membership of the EU remains unchanged (meaning we will continue to be part of EU) .
We will also be bound by any new trade deals signed by the EU and third countries for the remainder of this year. The Temporary Tariff Regime and Exceptional Review Procedure no longer apply, as we did not leave the UK without a deal on 31 October 2019. Instead, the Government will focus this year on agreeing a new trade and economic partnership with the EU which will define the terms and conditions with which the UK will trade with EU member states from 1 January 2021.
The EU has stated that the UK will be a third country if it leaves the EU without a Free Trade Agreement in place. Notwithstanding that, the Political Declaration (available here) states: “The economic partnership should through a Free Trade Agreement ensure no tariffs, fees, charges or quantitative restrictions across all sectors with appropriate and modern accompanying rules of origin, and with ambitious customs arrangements…”
The following Rest of World trade agreements are also being negotiated in parallel: USA, Australia, New Zealand, Japan.
A list of the countries with which Trade Continuity Agreements have been agreed, as well as those still under discussion, can be found here.
The UK will not have political alignment with the EU, nor will it be part of any customs union or EEA territory, and it will also not be subject to its legal frameworks. Additionally, whilst there is no commitment to Regulatory Alignment (a Technical Barrier to Trade) between the UK and the EU, Section C “Regulatory Aspects” in the Political Declaration states: “While preserving regulatory autonomy, the Parties will put in place provisions to promote regulatory approaches that are transparent, efficient, promote avoidance of unnecessary barriers to trade in goods and are compatible to the extent possible.”
Manufacturers will need to have markings and testing appropriate for both UK and EU markets (CE markings), which will, by consensus, have cost implications for business.
The Government is also looking at our own customs regimes during this period. Things being considered include questions regarding the biggest pinch points for business re:customs e.g. administrative, logistical costs and are businesses managing their own customs processes or hiring Customs Agents?
Northern Ireland (NI) (revised protocol):
NI will remain part of the UK customs territory but will also have access to the EU single market.
No tariffs will be applied on goods moving from GB to NI that are not deemed to be ‘at risk’ of entering the single market.
A Joint committee is also being set up between UK and EU to agree the details but there will be no hard border between NI and the Republic of Ireland .
This revised protocol sits outside of a Free Trade Agreement with the EU, so whilst potential future inter-dependencies between the FTA and protocol may exist (and will be studied), the revised protocol will come into play on 1st January 2021 irrespective of the nature of any FTA between the EU and the UK.
Additional information on UK – EU negotiations can be found here