As we leave the European Union and therefore the EU Customs Union, the Government seeks a new customs arrangement that facilitates the freest and most frictionless trade possible in goods between the UK and the EU, and allows us to forge new trade relationships with our partners in Europe and around the world.
This is the first in a series of papers setting out the UK Government’s thinking on our future
relationship with the EU. This paper details the Government’s aspirations for the UK’s future customs arrangements. These proposals respond to points raised in discussion with business and are intended to be the start of a wider dialogue with both business and other stakeholders ahead of negotiations in the autumn.
The UK’s traders are a key part of our economy and the Government is clear that any new customs system should be as facilitative as possible to encourage growth in trade with the EU and the rest of the world, and should mitigate to the greatest extent possible against any additional administrative burdens or delays.
The Government believes that there are two broad approaches the UK could adopt to meet these objectives. These approaches represent different choices about the nature of our relationship with the EU and countries around the world, but in either option the UK would seek to pursue its independent trade policy objectives.
● A highly streamlined customs arrangement between the UK and the EU, streamlining and simplifying requirements, leaving as few additional requirements on EU trade as possible. This would aim to: continue some of the existing arrangements between the UK and the EU; put in place new negotiated and potentially unilateral facilitations to reduce and remove barriers to trade; and implement technology-based solutions to make it easier to comply with customs procedures. This approach involves utilising the UK’s existing tried and trusted third country processes for UK-EU trade, building on EU and international precedents, and developing new innovative facilitations to deliver as frictionless a customs border as possible.
● A new customs partnership with the EU, aligning our approach to the customs border in a way that removes the need for a UK-EU customs border. One potential approach would involve the UK mirroring the EU’s requirements for imports from the rest of the world where their final destination is the EU. This is of course unprecedented as an approach and could be challenging to implement and we will look to explore the principles of this with business and the EU.
Our ultimate customs arrangement will depend on our negotiations with the EU. However, under either approach, both the UK and EU Member States would benefit from time to fully implement the new customs arrangements, in order to avoid a cliff-edge for businesses and individuals on both sides. The Government believes a model of close association with the EU Customs Union for a time-limited interim period could achieve this. It would help both sides to minimise unnecessary disruption and provide certainty for businesses and individuals if this principle were agreed early in the process.The Government would need to explore the terms of such an interim arrangement with the EU across a number of dimensions. The UK would intend to pursue new trade negotiations with others once we leave the EU, though it would not bring into effect any new arrangements with third countries which were not consistent with the terms of the interim agreement.
The Government has held discussions with a range of businesses, including those with complex customs requirements and those who trade mainly with the EU. We will continue to discuss these proposals with stakeholders over the summer and will publish a Customs White Paper in advance of the Customs Bill in the autumn.
The border between Northern Ireland and Ireland is the UK’s only land border. We must avoid a return to a hard border, and trade and everyday movements across the land border must be protected as part of the UK-EU deal. The Government welcomes the clear commitment made in the European Council’s negotiating guidelines and the European Commission’s directives to work with us on “flexible and imaginative” solutions to achieve this. Ahead of those discussions, this paper includes proposals that are first steps to meet our objective of trade across that land border being as seamless and frictionless as possible, but further steps will be necessary. The Government will publish a paper
relating to Northern Ireland shortly.
As the UK looks to forge new and ambitious trade relationships with our partners in Europe and around the world, we have a major opportunity to build a stronger, fairer and more prosperous UK, and one that is more outward looking than ever before.
In working to achieve that, we will:
● boost our trade relationships with both old friends and new allies;
● support the rules-based global trading system;
● ensure we protect our businesses from unfair anti-competitive practices;
● maintain our high level of standards and protect our public services;
● make trade work for everyone;
● support developing countries to reduce poverty through trade; and
● make trade more transparent and inclusive.
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