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Tariff and quota-free UK-EU trade put at risk by policy divergence

Tariffs could become a feature of food trade between the UK and the EU if their policies diverge in key areas over the coming years, peers have warned.

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Tariff and quota-free UK-EU trade put at risk by policy divergence

The House of Lords EU Environment Sub-Committee also claimed differences in policy may result in more checks on food and agricultural produce crossing Great British and EU borders.

 

The committee issued the warning after highlighting a rebalancing mechanism in the UK-EU trade deal which allows either party to introduce tariffs if significant divergences in environment or climate protection policies, among other areas, were to affect trade or investment.

 

One area singled out as a cause for concern was gene editing, with the National Sheep Association suggesting the UK’s plan to diverge from EU rules would be seen as ‘inflammatory’ so soon after Brexit and would be likely to result in increased safeguards and checks.

 

In a new report, Beyond Brexit, the committee quoted NFU director of trade and business strategy Nick von Westenholz.


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He said: “There is an elephant in the room. We are dealing with the here and now, but central to the Agreement is the possibility of regulatory divergence in future, maybe in the quite near future, and the potential implications of either side introducing new trade barriers through tariffs, for example.”

 

The committee has recommended that the Government and the EU thoroughly assess potential trade barriers which may arise as they develop approaches to regulating and supporting food and agricultural production.

 

In the report, peers also expressed their ‘dismay’ that some British exports, of seed potatoes and live animals, for example, were facing ‘outright bans’.

 

They went on to demand Ministers prioritise the digitisation of key systems for animal exports and fix problems affecting ‘groupage’, where several batches of goods are combined in one load.

 

Difficult

 

Lord Teverson, chairman of the sub-committee, said: “The increases in paperwork and preparation required for food and agricultural exports to the EU are presenting very difficult challenges, particularly for small businesses.

 

“Higher haulage rates and issues with groupage and parcel deliveries are putting further pressure on food and agricultural produce exporters.

 

“Despite the improvements we hope to see, there are now new barriers to UK-EU relations and new administrative costs and burdens will be structural and long-term.”

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