Britain on Monday (9 October) outlined proposals for new laws to set tariffs and quotas including if Britain leaves the European Union with no agreement in place, as it prepares for a post-Brexit customs system.
The government said the draft legislation to be put forward this autumn would allow for “a standalone customs regime from day one” in case there is no deal between British and EU negotiators by 2019.
— HM Treasury (@hmtreasury) October 9, 2017
The rules would allow the government to set tariffs and quotas and establish a goods classification system in line with the government’s obligations as a member of the World Trade Organisation (WTO).
— BBC News (UK) (@BBCNews) October 9, 2017
The proposals for a customs bill were published alongside those for new trade legislation that would allow Britain to enter into new international free trade agreements once it has left the EU.
What's striking about UK customs & trade papers is they do a better job at explaining value of current status than post-Brexit opportunities pic.twitter.com/NayI6AA2dv
— Alberto Nardelli (@AlbertoNardelli) October 9, 2017
Speaking to parliament, Prime Minister Theresa May said the proposals “pave the way for legislation to allow the UK to operate as an independent trading nation” and establish an “innovative” customs system.
“While the UK hopes and expects to achieve a negotiated settlement that is in the interests of all parties it is only prudent that the government prepares for every eventuality,” the proposals said.
The government warned that businesses that currently only trade with the EU would be subject to customs declarations and customs checks for the first time after Brexit if there is no negotiated agreement.
“Imported goods would be liable to customs duty and import VAT. Certain goods may require import or export licences, and traders exporting to the EU would have to submit an export declaration,” it said.
The government said it was “actively considering” ways in which to mitigate the impact in such a scenario and said its priority was ensuring that UK-EU trade would be “as frictionless as possible”.
It also said the new customs rules should avoid a hard border between Ireland and Northern Ireland and establish an independent international trade policy.
UK have published a Brexit customs white paper. Either deliberately obtuse or dont understand implication of border being the frontier of CU pic.twitter.com/uBpriAAtKx
— Gerard Brady (@GerardBrady100) October 9, 2017
In a foreword to the customs paper, Finance Minister Philip Hammond also underlined the importance of a transition period after Brexit to allow businesses to adjust to new rules and avoid a “cliff-edge” scenario.
May has raised the prospect of a two-year transition.
“It takes time to negotiate trade deals and even more time to build new trading relationships; and adjusting to different customs, VAT and excise systems cannot happen overnight,” Hammond wrote.
Hammond: 'many of challenges around the customs border are highly technical. They don't demand politicians behind lecterns making speeches.'
— Chris Mason (@ChrisMasonBBC) October 3, 2017