Business say UK's Position Regarding Goods on the Market a "Significant improvement" on EU’s Position

The UK Government has on August 21 made a fresh case for why it is in the interests of both the EU and the UK that the Brexit process is as smooth and orderly as possible for UK and European businesses and consumers.

The Government has released further position papers ahead of upcoming Brexit negotiations covering the UK’s negotiating approach to goods on the market and to confidentiality and access to official documents have been published today ahead of the third round of negotiations.

Concerning good on the market, the UK’s position paper outlines four key principles for ensuring a smooth and orderly withdrawal from the EU in regard to the availability of goods:

1) The UK wants to ensure that goods which are placed on the market before exit day can continue to be sold in the UK and EU, without any additional requirements or restrictions.

2) The UK wants to avoid unnecessary duplication of compliance activities that have been undertaken by businesses prior to exit. This means that where products have gone through an authorisation process prior to exit, for example a type approval for a car, this approval should remain valid in both markets after exit.

3) The UK are clear that patient safety and consumer protection in the EU27 and UK are paramount, which means that any agreement will need to facilitate the continued oversight of products to ensure the necessary action can be taken for non-compliant or unsafe goods.

4) The provision of goods and services is increasingly interconnected. Services are essential for production of goods, for their sale, distribution and delivery, and for their operation and repair. Where goods are supplied with services, the UK believes there should be no restriction to the provision of these services.

Businesses have welcomed the latest move.

Responding to the UK’s position, John Foster, the CBI's Director of Campaigns said:

“The UK Government’s position on goods is a significant improvement upon the EU’s current proposal, whose narrow definition would create a severe cliff-edge hitting consumers on both sides of the Channel.

“However, the only way to provide companies with the reassurance they need is through the urgent agreement of interim arrangements. This would ensure that goods and services can still flow freely giving companies the certainty they need to invest. “The simplest way to achieve that is for the UK to stay in the single market and a customs union until a comprehensive new deal is in force.

“Both sides should agree to move talks on to interim arrangements as soon as possible to stem the loss of investment.”

Example Highlighting the Difference Between UK & EU Position Papers

The CBI presents an example as to how the two sides are approaching goods on the market.

At present, every new model of car, motorbike, bus and lorry made in the UK has to go through stringent testing by the Bristol-based Vehicle Certification Agency before it can be sold.

It costs between £350,000 and £500,000 for a whole vehicle to get approval, and – because of the UK’s EU membership – that approval is automatically valid for the whole of the EU.

Under the EU’s proposals, a UK-made car put on the market for sale on 29th March 2019 would still be able to be sold in the EU the next day as its approval would still be valid.

However, a car from the same production line, which had gone through the exact same process and secured the exact same approval, but was put in the market for sale on 30th March 2019 would not legally be allowed to be sold in the EU.

In this scenario, UK car companies would have to secure licenses from EU approval agencies for all models currently in production – adding significant extra costs, impacting competitiveness of UK products and hitting the pockets of consumers on both sides of the Channel.

There would be a real risk that uncertainty would drive car dealers to cancel orders from UK-based companies, in case those vehicles could not be sold.

Across the UK, the CBI speaks on behalf of 190,000 businesses of all sizes and sectors.

The CBI’s corporate members together employ nearly 7 million people, about one third of private sector-employees.

With offices in the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world.