UK Government publishes its Customs Union proposals

The UK Government has begun producing a serious of papers outlining its post-Brexit vision for relations between the UK and the European Union.

The 14 page document outlines how the UK will seek a transitional period before attempting to set up a system that gives it basically the same access that it has now.

There are some Northern Ireland specific proposals, but a paper deal specifically with this issues will be published at a later stage, but back to customs.

Here are the specific proposals dealing with the border;

However, the proposals do note that Customs issues would be consulted with a future NI Executive (if we get one back up).

The response from the EU has not, however been encouraging;

Ian Dunt has some interesting analysis on some of the flaws of these proposals;

What’s really unclear, of course, is exactly why the EU would agree to this. There is an existing customs union, which the UK is in. It gains nothing by granting the power to form another identical one, for no reason except to make the international trade secretary feel better about himself. There is also considerable confusion over the legal status of this arrangement. We’d be out the EU, and therefore outside the remit of new EU law and the jurisdiction of the European Court of Justice (ECJ). Presumably Westminster would promise to reflect any new EU law in its own books during this transitional period. But what about new ECJ interpretation of EU law? We just don’t know and it’s not clear the Brexit department does either.

After this period is over, the government is proposing two alternate models for a future relationship: a streamlined customs arrangement or a new customs partnership. It is not clear which they prefer or why. It is not even clear if they have a preference. What is clear is that they have no idea how much they will cost, if any new buildings would need to be leased in order to oversee them, what kind of infrastructure is required to deliver them, if new training would be necessary, how much the various technical solutions they propose would cost or whether they would fit into our existing systems.

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  • The Saint

    Thank goodness that finally their is some clarity…….that clarity is clear as mud, but it’s something, is it something that can be a basis for discussion? I’m not so sure.

    So a country wants to exit, establish its own trade deals? But wants have access to free market? I don’t understand how that might work.

  • runnymede

    The Commission’s response is otiose as the UK government paper doesn’t call for ‘frictionless trade’, only trade with a minimum of frictions.

    Indeed, it’s arguable that there is no such thing as ‘frictionless trade’ now either, as there are transport, logistics, language and reporting issues connected with exports to the EU.

    So meaningless soundbite I’m afraid.

  • runnymede

    It can work through the UK having a free trade arrangement with the EU which is not one that includes a common external tariff.

    There are many examples of this worldwide, including e.g. NAFTA (and indeed the EEA treaty between the EU and three of the EFTA countries, in which the latter three are in fact single market members but set their own external tariffs).

  • Brian Kann

    Well if this is anything to go by, the proposals on the Irish border should be interesting.

    The reasoning, if it can be called that, seems to be:

    – We desperately need the benefits of the Customs Union as we have a serious dependence on your markets and those dozens trade deals we have with other countries by virtue of EU membership will fall away overnight if we leave. Oh, and our economy will tank spectacularly otherwise if we leave without agreeing anything (neither of which we can’t openly admit)
    – Unfortunately, as its called an EU Union and not a Great British one that we exclusively control, we can’t accept being legally and officially in it either.
    – So we will eventually build our own one called the British EU Customs Partnership that we hope you will let us completely govern on our own. This is quite convenient, as it allows us to benefit from all those nice trade deals we had access to as members of the EU. It goes without saying that our courts would police this but as everyone knows, we have the best courts in the world, that shouldn’t be an issue.
    – At the same time, as its our union, it’s only fair we can strike trade deals with other countries after a while despite this being against one of the most important principles of the Customs Union. Don’t worry about this being a lower-regulation and tariff-free backdoor into the EU market for some countries (say chlorinated chicken from the US) – we’ve plans for some snappy technology that may or may not take care of this, once we get around actually looking into this rather than referring vaguely and optimistically to it each time.
    – It would also be great if we didn’t have to pay for any of this.

    That’s about it chaps. We’re off for some Pims and Cricket so do let us know when you can sign this! Tally ho!

  • Korhomme

    The FT says the EU has 759 agreements with 168 countries. How is the UK going to replicate this?

  • Korhomme

    It’s well worth reading Ian Dunt’s column in full.

    Likewise his book, ‘Brexit; what the hell happens now?’ is very worthwhile.

    It becomes clearer every day that the British government, while wanting cake and eating it, haven’t realised that this is impossible.

  • Barbazenzero

    Quite so, but that would require a hard customs border. Do you really think the DUP will allow the Con government to do that?

  • runnymede

    It isn’t, as Ian Dunt has nothing useful to say on this issue.

  • runnymede

    ‘Hard customs border’ is a slogan, not a useful term.

    There will be a bit more friction at the border in future, yes, for goods. Probably something like the Norway/Sweden situation. And the DUP will go along with it. It won’t be scary, or catastrophic.

  • Barbazenzero

    How many crossing points do you think there are on the 500 Km NI border?

    Norway & Sweden have a long border but relatively very few crossing points.

    In any event it would threaten the Belfast Agreement.

  • hgreen

    They’ve taken over a year to come up with this nonsense?

  • runnymede

    I’m really not sure what you are trying to read into ppgh. 43, which is pretty broad brush ie movements of goods and people to be ‘protected’. I think we can all agree to that.

    We’ve had these discussions re. border crossings here before. The bulk of goods flows between NI and ROI are made by a relatively small number of larger firms and will in future probably be run using an AEO system and through designated routes.

    As for all the little lanes, frankly it’s not a problem whose scale is worth spending too much time on. There are already UK exchequer losses from eg tobacco smuggling which is a price paid to keep the border open. There will be some cameras here and there on the UK side, the odd inspection (beyond the border) and that will be it.

    If the ROI wants to start being more aggressive on its side of the border, at the EU’s behest, that’s up to them of course.

  • hgreen

    A Free trade agreement would be long, complicated and may not include certain goods and services for industries the EU and it’s individual members want to protect. It would thus lead to border controls here in Ireland. In other words a pipe dream.

    Eventually everyone will come round to the fact that retaining customs union membership is the only workable solution.

  • runnymede

    Sorry, you are deluding yourself, the UK’s participation in the EU customs union is going to end.

    But a new border arrangement needn’t be very onerous (see below), unless the ROI wants to make it so on their side.

  • hgreen

    Naive. The difference is that post Brexit, tariffs may be in place creating a bigger incentive for the illegal movement of goods not just tabs.

  • Korhomme
  • runnymede

    A light touch border on both sides is very hard without a liberal trade regime between ROI and UK, yes. That’s why the EU trying to ‘solve’ the border issue before the trade agreement is agreed makes little sense.

    If the EU does refuse an FTA, then the UK fallback position is likely to be unilateral free trade (in manufactures at least). And that would be quite compatible with a light touch border on the UK side. Indeed, this has been strongly hinted at by e.g. David Trimble.

    In this case, any ‘hard’ border is going to be on the ROI side, at the EU’s behest.

    So the ROI should be lobbying strongly for an FTA now, if it wants to avoid that.

  • Angry Mob

    I believe the figure is well over 200. Whilst Norway and Sweden have about 10 border crossings for goods vehicles, 30 normal crossings and 4 rail crossings which is not unsubstantial given the population density of those countries which makes Fermanagh look cramped, it doesn’t really make for a great comparison.

  • hgreen

    Naive. So you’d expect British businesses to accept free import of EU goods but allow their own to be subject to tariffs?

    As Nicola Sturgeon said today the only solution is continued membership of the customs union. We appear to have a lot of slow learners.

  • runnymede

    It’s not going to happen, no matter how much you convince yourself otherwise.

  • hgreen

    It has to happen. Aside from the jobs impact, on a practical level Dover and other ports won’t be physically able to cope. (Unless people are happy with a permanent operation stack.) We are already seeing steps to dilute Brexit today with talks of delays and transitional deals. Keep living the pure Brexit dream but eventually reality will sink in.

  • Roger

    Norway is in EEA.
    If UK announced it was joining EEA I think the remainers would be happy and this topic largely finished.

  • jokerswild
  • A Bit Left and a Bit Lost

    Read it all. Very vague and management consultantesque. No real indication of future strategy…

    https://www.gov.uk/government/policies/brexit

    I’m hoping Ireland paper today is more concrete

  • Barbazenzero

    Agreed. I had a close look at my GPS map of Norway and could find only one village in the deep South which straddled the border with Sweden, and none at all on the Finnish border.