At the start of last week, chief executives from the UK’s leading supermarkets, and the BRC chief executive Helen Helen Dickinson, wrote to Brexit minister, Lord Frost, and vice-president of the European Union, Maroš Šefčovič.
They outlined their concerns over grocery choice and affordability in Northern Ireland after new checks and controls are set to be introduced from October 2021.
In Parliament, Lord Frost and secretary of state for Northern Ireland, Brandon Lewis, set out their vision for removing GB-NI friction in a new command paper. So why wasn’t the retail industry celebrating?
Well, we did see some good in the Command Paper. It is clear that the UK government has listened to the retail industry with regard to those checks, controls and certificates that are due to come in for goods moving from GB to NI.
They recognise the friction, and they recognise the associated costs that will come with it – costs that neither the retail industry nor Northern Ireland households, with half of the discretionary income of GB households, can afford.
Is the ‘cliff edge’ edging ever closer?
Particularly helpful is that the UK government has put a request to the EU for a ‘standstill of existing arrangements and grace periods’. This is meant to avoid a ‘cliff edge’ when the existing grace periods ends, with the current arrangements and status quo continuing to operate whilst both sides have ongoing discussions to agree longer-term solutions.
This would mean no change to existing customs and regulatory requirements for the duration of the standstill.
The main thrust of the UK proposals is to focus more on the final destination of goods that are actually at risk of entering the EU. Therefore, they propose changes on the basis of how the ‘at risk’ tests would work for goods moving from GB into NI and offer greater flexibility around UK origin goods sent to NI as the end destination.
This would not change the current requirements around EU-origin goods moving through GB and on to NI.
To do this, the UK wants to focus on supply chain information, through a trusted trader scheme, and a light touch registration scheme.
“The UK has also stated that at this stage the UK Government is not minded to trigger Article 16”
This would be available to established British businesses and would thus be a lot more flexible than the current established UK Trader Scheme. The UK government’s ambition would be to try to avoid requirements for NI establishments to register on the scheme, and this would also cover the movement of parcels.
The UK has also stated that at this stage the UK Government is not minded to trigger Article 16, even though it believes it has the right to do so, given current difficulties with some aspects of the Protocol.
However, there is a but - and it is a huge but. The UK government has listened to the problems facing retailers and the aims of what they are seeking to do are laudable. But any solution that is not agreed by both sides cannot provide the certainty and stability that retailers and Northern Ireland consumers need.
The UK government is seeking to renegotiate significant parts of the Protocol in respect of Customs and regulatory requirements in particular.
For the EU, there is no appetite for renegotiation. But even if it did, there are things in this command paper that are simply unpalatable to the EU, such as the proposed removal of the European Court of Justice jurisdiction from Single Market matters in Northern Ireland, which doesn’t happen anywhere else that the Single Market is in force. It is one of the reasons why some of the member states signed up to the Withdrawal Agreement and the Northern Ireland Protocol.
The unique position of Northern Ireland
So, there are some good ideas in the command paper, but they are only workable if they can be agreed upon. Northern Ireland is in a unique situation that requires a unique solution with the backing of both the UK and EU.
There is a real urgency now to deliver an agreed solution that works for consumers. It is hugely difficult for businesses to plan for the future or invest if there is no stability.
We need both sides to make further progress to allow us to continue to give NI households the choice and affordability they require.
We in business can see solutions such as a trusted trader scheme or a veterinary agreement. We now need to see the political will to deliver them.
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