23 August 2017
Dr Peter Holmes Reader in Economics at the University of Sussex and Fellow of the UKTPO
The government’s new paper “Continuity in the availability of goods for the EU and the UK – a position paper“ acknowledges the problems that will be created by a hard Brexit in which there is a disruption in the systems for verifying compliance with mandatory standards.
The problem is that its substantive proposals deal with only the most immediate disruptions in the sale of goods that are already in the supply chain at the moment of Brexit. The official description acknowledges this: “This paper outlines the UK’s position on continuity in the availability of goods in UK and EU markets at the point of EU exit” (my italics).
Yet, the key requirement for the British economy is that there needs to be a permanent system in place for ensuring that UK product inspection systems are recognised by the EU for goods made after Brexit.
As the BBC notes
“A position paper calls for goods already on the market to be allowed to remain on sale in the UK and EU without additional restrictions.”
The UK paper lays down several “Principles”.
“Principle A: Goods placed on the Single Market before exit should continue to circulate freely in the UK and the EU, without additional requirements or restrictions “
“Principle B: Where businesses have undertaken compliance activities prior to exit, they should not be required to duplicate these activities”
“Principle C: The agreement should facilitate the continued oversight of goods”
and
“Principle D: Where the goods are supplied with services, there should be no restriction to the provision of these services that could undermine the agreement on goods”.
Apart from principle D, which highlights the link between goods and services, the new UK paper is very similar to the paper produced by the Commission in July: “Position paper on Goods placed on the Market under Union law before the withdrawal date”. The Commission’s report is in fact more explicit about what it covers, namely that
“a good lawfully placed on the market before the withdrawal date and still in the distribution chain in the United Kingdom or in the single market after the withdrawal date can in principle continue to be made available if it complies with Union product rules applicable on the withdrawal date.”
The government’s paper fails to consider the process for goods made after Brexit. It is irrelevant whether the UK keeps the same technical regulations as the EU unless we have a system like that of the wider EEA where our testing and inspection regimes and the associated paperwork are recognised as valid by our partners.
This lack of attention to the need for longer term Mutual recognition of Conformity assessment issues is striking.
The pro-Brexit blogger Richard North said in his comments on the paper:
“To ignore these issues, though – as the Government seems to be doing – is thoroughly irresponsible. It reduces the time our businesses have to prepare for the worst case scenarios, and risks exposing them to having consignments rejected at the borders, with all that implies in cost and chaos.”
It is obviously good news that the UK and the Commission are broadly in agreement on the need to ensure that supply chains do not grind to an immediate halt on B-Day, but disappointing that so little attention is paid to the need for mutual recognition of testing and certification for conformity assessment to facilitate trade in goods between the UK and the EU after Brexit.
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The opinions expressed in this blog are those of the author alone and do not necessarily represent the opinions of the University of Sussex.
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This paper is not designed to cover more long term systems required to maintain trade post Brexit. It is looking at the good on the market issue specifically.
Maybe it’s not surprising that the government’s paper doesn’t deal much with the issue of equivalence because for the UK standards legislation to be and to remain the same as that of the EU requires not only that EU legislation as it exists at the time of Brexit should to written into UK law (which the government does intend) but that it should remain the same – meaning that it won’t be changed except when EU law changes, that it will be changed each time EU legislation changes and that it should be interpreted in the same way. None of these requirements sit well with the government’s insistence of sovereignty and its red line on freedom from the European Court of Justice. Seamless trade won’t be possible without compromise on these points – but its supporters seem determined to deny it the wiggle room it needs to achieve this.
It’s really only chapter 1 of a much bigger paper that needs to be out there immediately to give business the confidence to not have to plan for the the worst case scenario. To be frank, it looks like a copout. ie. It gives the appearance of substantive work done, but is really only a paper that took about 10 minutes to prepare with zero need for difficult thinking.