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Government has much work to do to avoid cliff edge for non-EU trade

7 March 2018

The International Trade Committee publishes report on the continuing application of EU trade agreements after Brexit.

Legally watertight and practically viable strategy

Trade with 70 nations risks falling off a cliff edge if the Government does not act quickly to roll over EU trade deals, the International Trade Committee has found.

A report by the Committee calls on the Department for International Trade to produce "a legally watertight and practically viable strategy" to achieve "transitional adoption" of trade agreements the UK is currently party to through its membership of the European Union.

The Government still needs to work out a number of important details before continuity can be achieved – and businesses, consumers, investors need certainty on what will happen to the trade deals as a matter of urgency.

Key tasks

In its assessment of the Government's work to date, and the key tasks which lie ahead, the Committee has concluded:

  • The exact number of EU trade and trade-related agreements appears to be a matter of some uncertainty. The Committee concluded that there is an urgent need for clarity over the number, type, scope, extent and importance of the EU's trade-related agreements.
  • DIT has identified rolling over EU trade agreements as its second highest priority and taken up the task at ministerial level, but there is still a disturbing lack of precision and clarity about the appropriate legal mechanism.
  • The Committee welcomes the Government's new approach of asking that the UK be treated during the post-Brexit transition as if it were still an EU member for the purposes of these agreements. But this is seen by the Committee as a tacit admission by the Government that its initial policy of negotiating new agreements by March 2019 may not be achieved. The Government is urged to ensure that appropriate resources are allocated to the task of rolling over the agreements.
  • Substantive amendments to rolled-over trade agreements will almost certainly be required, as the Government itself has effectively acknowledged.
  • The Committee recommends that the Government should set out provisions for more extensive parliamentary scrutiny and enhanced involvement by the devolved administrations where substantial changes in trade agreements are implemented through legislation.
  • A cross-departmental approach on the part of the Government to all of the above issues, which involves DIT, the Brexit department and the devolved administrations (among others) is urgently needed.

Chair's comments

Launching the report, Committee Chair Angus Brendan MacNeil MP commented:

"The Government is making much of the trade agreements it plans to make after Brexit, but first it needs to give us confidence that the existing agreements, on which businesses, consumers and trading partners alike rely, can be rolled over so the UK can benefit in its own right. Unless an agreement is reached with our trading partners in the coming months, a significant economic price will have to be paid.

"The Government is therefore correct to have identified maintaining our rights under these agreements as a priority. However, as the Committee has found over the course of our inquiry, a number of thorny issues and significant risks remain unaddressed. The Government must not be naïve enough to assume that a verbal agreement to maintain the status quo constitutes a watertight guarantee – contingency plans are required.

"Our report makes a number of practical recommendations, including the publication of a detailed timetable for avoiding a cliff-edge, and the development of a risk register in relation to trade and trade-related agreements that need to be rolled over. This issue requires a cross-Government response, and a fully transparent, cross-departmental approach to constructing the UK's overall long-term trade policy strategy." 

Further information

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