The Trade Facilitation Commission (TFC), an independent body of trade experts and former government officials, recently raised significant concerns about the Labour party’s proposal to sign a veterinary deal with the EU. The primary goal of this deal is to reduce the post-Brexit border checks and bureaucracy that have plagued trade between the UK and the EU. However, the TFC warns that such an agreement could pose considerable risks to the UK’s regulatory independence, potentially undermining its ability to maintain and enhance its stringent sanitary and phytosanitary (SPS) standards.
The Current Post-Brexit Border Model
Post-Brexit, the UK put into place the Border Target Operating Model (BTOM), a framework that requires all EU imports classified as medium and high risk, such as meat and dairy, to undergo sanitary and phytosanitary (SPS) controls. These controls necessitate veterinary-signed certificates that can cost up to £150, contributing to increased trading costs and delays. Recognizing these challenges, Prime Minister Keir Starmer proposed negotiating a veterinary deal with the EU to allow for mutual recognition of food safety standards. This deal would eliminate the need for such health certificates, simplifying the process and theoretically easing trade.
Under BTOM, such measures were seen as necessary to ensure that high-risk products met the required standards. However, these measures have created significant friction at the borders, slowing down trade and increasing costs. The idea behind Starmer’s proposal is to negotiate an agreement similar to the one the EU has with New Zealand. This would involve both parties recognizing each other’s food safety standards, which would theoretically reduce the need for border checks and thereby lower costs and speed up the movement of goods.
TFC’s Recommendations for a Robust Agreement
A major theme in the TFC report is the caution against a loosely structured veterinary agreement. Instead, the TFC recommends a robust, New Zealand-style mutual recognition agreement where both parties are treated as low-security risks. Such an agreement would facilitate more streamlined customs processes and reduce the likelihood of safety checks, ultimately benefiting businesses and consumers on both sides. The TFC also highlights the importance of establishing a solid framework to ensure that both parties adhere to high standards consistently.
The report emphasizes that the UK should not rush into an agreement that might undermine its ability to regulate independently. A loosely defined deal could make it difficult for the UK to enforce its own stringent SPS standards effectively. The TFC suggests that by adopting a more robust agreement, the UK could maintain its high regulatory standards while still easing the trade barriers that currently exist. This approach would also likely build greater trust between the UK and EU, leading to more cohesive and effective regulatory practices.
Risks of Dynamic Alignment
The concept of dynamic alignment is another crucial element discussed in the TFC report. Dynamic alignment involves the UK and the EU maintaining equivalent regulatory standards for future trade to simplify checks and controls. While this approach might initially seem advantageous, the TFC warns that it could lead to significant risks. One potential drawback is that it could hinder the UK’s ability to enhance its SPS regime independently. The UK currently has stricter regulations in some areas than the EU, such as its bans on the export of live animals and the use of sow stalls.
If the UK were to align dynamically with the EU, it might limit its ability to adapt and improve its regulations to align with emerging scientific standards and specific animal welfare concerns. For example, the UK’s advanced animal welfare regulations could be compromised under a dynamic alignment scheme. The TFC argues that such alignment would prevent the UK from addressing these evolving issues proactively. Instead, the TFC suggests that the UK can still achieve the benefits associated with reduced physical checks by unilaterally recognizing EU product market regulations without conceding its regulatory independence.
Maintaining Regulatory Independence
The TFC report underscores the importance of maintaining the UK’s regulatory independence, even while striving to ease trade restrictions and reduce border delays. While dynamic alignment might reduce the intensity of physical checks from the UK to the EU, it would still necessitate the implementation of customs processes, paperwork, and other regulatory checks on the EU side. Therefore, maintaining regulatory independence allows the UK to continue improving its regulations and addressing specific issues unique to its context.
The report also cautions against the UK seeking to join the EU’s safety and security zone. Joining this zone could lead to further complexities, as evidenced by the extended deadline for new requirements for safety and security declarations on European goods, now set for January 2025. Delays in the rollout of the government’s Single Trade Window further compound these challenges. These issues highlight the need for the UK to explore alternative solutions that allow for streamlined trade without compromising regulatory standards.
Advancing Smart Borders and Digital Trade
One such alternative solution proposed by TFC commissioner Lars Karlsson is the implementation of smart borders and digital trade corridors. Smart borders would involve advancements such as automated monitoring, real-time container tracking, and pre-arrival data exchanges. These measures would streamline border operations, enhance security, and reduce the need for physical checks. The use of technology in managing borders could significantly improve efficiency and reduce delays, making trade smoother and more predictable.
The TFC report articulates the associated risks of entering a relaxed veterinary deal with the EU and the potential pitfalls of dynamic alignment. While it is crucial to alleviate trade restrictions and reduce border delays, these goals should not come at the expense of compromising the UK’s regulatory independence and advances in animal welfare standards. The TFC’s proposal for a New Zealand-style mutual recognition agreement presents a more secure and beneficial approach for both parties. By adopting such a robust framework, the UK can maintain high regulatory standards while still facilitating smoother trade relations with the EU.
Trusted Trader Schemes and Economic Growth
The Trade Facilitation Commission (TFC), an independent panel of trade experts and former government officials, has recently voiced significant concerns regarding the Labour party’s idea to establish a veterinary agreement with the EU. The main aim of this proposal is to alleviate the post-Brexit border checks and bureaucracy that have caused difficulties in trade between the UK and the EU. Nonetheless, the TFC cautions that such an agreement might pose substantial risks to the UK’s regulatory independence. It could likely compromise the nation’s ability to uphold and enhance its rigorous sanitary and phytosanitary (SPS) standards. These standards are crucial for protecting both public health and the agro-food sector. By aligning too closely with the EU’s regulations, the UK might lose the flexibility to adjust its standards based on national needs and innovations. The TFC’s apprehension underscores a broader debate on balancing trade facilitation with maintaining sovereign regulatory practices, especially in areas as vital as public health and food safety.
