BRC demands Brexit clarity after white paper

The British Retail Consortium (BRC) has called for further clarity around the government’s Brexit plans, following yesterday’s publications of a new white paper.

Among the new details contained within the document was the proposal that businesses should be able to move “their talented people” from the UK to the European Union - and vice versa - with the UK government prepared to allow EU citizens to travel freely without a visa in the UK for tourism and temporary work.

The white paper confirmed that there will be an end to the free movement of people at the end of the transition period in December 2020, but added that it will be necessary to recognise the “depth of the relationship and close ties between the peoples of the UK and the EU”.

“The UK’s future economic partnership should provide reciprocal arrangements, consistent with the ending of free movement,” the white paper read, adding that these would include measures that “support businesses to provide services and to move their talented people”.

However, further detail on how migration arrangements could work after Brexit was scarce, with another white paper promised in the autumn.

Helen Dickinson, chief executive at the BRC, said she has already made it clear that a frictionless customs system is vital for retail businesses, so was encouraged to have seen some progress within the white paper, but added that “the retail industry still needs clarity on how this will be facilitated”.

On tariffs, the BRC also demanded further clarity about what a phased system would look like in practice and on how a backstop arrangement would work. On customs, the trade organisation requested detail as to how the proposed tracking system would work in practise and an understanding of the costs involved and who would bear these.

And on immigration, the BRC stated that the retail industry is supported by a high percentage of employees from across the EU. “A mobility framework which allows retailers access to European employment markets is essential if the industry is to access the numbers of employees it needs,” it added.

Malcolm Dowden, legal director at law firm Womble Bond Dickinson, pointed out that the white paper proposes the creation of a ‘free trade area for goods’, coupled with a ‘facilitated customs arrangement’ to allow cross-border trade to be as frictionless as possible.

Central to those proposals is the concept of ‘trusted traders’, with the document suggesting that “where a good reaches the UK border, and the destination can be robustly demonstrated by a trusted trader, it will pay the UK tariff if it is destined for the UK and the EU tariff if it is destined for the EU”.

Dowden explained that in Europe, trusted traders are referred to as Authorised Economic Operators, with businesses needing to show at least three years’ experience of meeting customs obligations to get certification.

“That test cannot be met by the estimated 131,000 businesses who, according to HMRC estimates, will be brought into customs procedures for the first time,” he stated. “It is possible to buy-in expertise or to use intermediaries such as freight forwarders or distribution companies.”

Dowden added that in the event of a no deal Brexit, or of a deal that did not include mutual recognition, “the trusted trader concept that underpins the white paper suggestions would not provide frictionless trade”.

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