Brexit: Trade in Food Contents

3Non-Tariff Barriers

72.A non-tariff barrier is any measure, other than a customs tariff, that acts as a barrier to international trade. The UN Conference on Trade and Development classifies 16 types of non-tariff barriers.63 Examples include sanitary and phytosanitary measures, labelling requirements, pre-shipment inspection and formalities, subsidies and rules of origin as well as protected product descriptions known as Geographical Indicators (GIs).

73.Witnesses expressed concern that, following Brexit, non-trade barriers could pose significant obstacles to trade in goods. In this Chapter, we focus on two major non-trade barriers: regulations and standards; and customs checks.

Regulations and standards

74.The regulatory environment can be an important factor in trade as it can be an impediment to trade. Membership of the Single Market removes many regulatory barriers to trade, through harmonisation of standards64 and mutual recognition of standards,65 which are underpinned by supranational institutions.66

75.Immediately after leaving the EU, the UK will be fully aligned with EU rules. It will then be for Parliament to decide whether to keep current regulations or to change them. But even if the UK has (as it intends to through the EU (Withdrawal) Bill) transferred EU laws into UK law, that will not in itself prevent new regulatory barriers. As the Institute for Government stated in a recent report, “There is a difference between having the same rules and having those rules legally recognised as being the same as the EU’s”.67

76.Witnesses told us that they wanted to see limited regulatory divergence so that no non-tariff barriers were introduced. The Andersons Centre said: “If you keep the standards aligned and harmonised, you make the challenges a lot more attainable in terms of managing the changeover into the post-Brexit world”.68

77.British Summer Fruits put it in starker terms: “There is a risk that, if you diverge from the EU standards, the export opportunities that exist will disappear”.69

78.Witnesses highlighted the increased costs to businesses that regulatory divergence would cause. As Sustain noted, “Generally, when standards start to diverge then costs start to accrue in tracking the difference between the products. What kind of paperwork will have to be provided? What kind of proof of certification or standard-setting will there have to be, and also what kind of inspection regimes, particularly at borders?”70

79.We also heard concerns that regulatory divergence from the EU could have a negative impact on seeking FTAs with non-EU countries post-Brexit. AHDB told us:

We are already experiencing questions from third-country markets about how the UK, post Brexit, proposed to maintain the current EU standards, which were the standards that were agreed with these importing countries that we have historic agreements with.71

80.Some witnesses told us that Brexit was an opportunity to seek some degree of change in regulations to better target them to the United Kingdom. But they recognised that any change in regulations would be constrained by the need for some sort of continued alignment in order to facilitate trade with the EU.72 Some examples included: “streamlining and rationalising” the pig sector;73 and introducing a more open, more risk-based approach to certain niche sectors in plant health regulation.74

81.We heard that Brexit would be an opportunity to re-develop regulation around animal disease and animal welfare policy. The National Pig Association spoke of the current threat to the pig sector from African swine fever, and the danger it posed to our export market if it reached the UK. It continued:

There is definitely an opportunity to rationalise our policy on imports in particular, and to look at a more country-by-country profile in Europe as to where risks are generated. At the moment, it is a common trade area and products can move very freely. We can look at that and rationalise it. Being an island nation, … we at least have the ability to look at it again and decide how we can implement a policy that keeps disease out properly.75

82.The RSPCA told us that there was also an opportunity to go further than current EU legislation to improve farm animal welfare standards, for example, for the UK to develop animal specific legislation in sectors such as ducks, dairy and beef cattle standards.76

83.Some witnesses, on the other hand, cautioned that raising standards could undermine UK farmers’ competitiveness. The British Retail Consortium told that there was a need to “be careful about raising regulations to a certain point simply for the sake of it, but you may not always be able to pass the value of that on to consumers. The last thing we want to do is look at a higher tier of regulation that is not valuable to the consumer”.77

84.Food and Drink Federation (FDF) Scotland spoke of the need to ensure that the EU recognised UK regulations in any post-Brexit scenario: “The whole point of Brexit is to make sure that we can make our own rules in the UK, but without mutual recognition of those standards between the UK and EU there is an enormous amount of additional work that businesses will have to do, in particular to export into the EU”.78

85.Leaving the Single Market could lead to regulatory divergence. It is not yet clear if the Government intends to maximise UK sovereignty, at the cost of less access, or whether it intends to achieve maximum access, but with the loss of opportunity to create bespoke regulations for the UK’s benefit.

86.The Government must make it clear to industry how it intends to deal with potential regulatory divergence with the EU, and the mechanisms it will put in place to track divergence in the future.

Geographical indicators

87.A geographical indicator (GI) is a sign used on products that have a specific geographical origin and possess qualities or a reputation that are due to that origin. The United Kingdom has a total of 65 products with protected status. Examples in the UK include cornish clotted cream, stilton cheese, welsh lamb, and scotch beef. Witnesses mentioned geographical indicators (GIs) as a priority for a trade agreement with the EU.

88.HCC told us that GIs added value to products such as Welsh Lamb and Welsh Beef: “In some established EU markets there is high consumer recognition of this designation, but more generally in the global food industry, it is recognised as a mark of quality”.79 Ladies in Beef told us that more could be done in promoting geographical indicators. She noted that the Protected Geographical Indicators of West County Beef and Lamb had been “hard won” and that it had huge potential, but there needed to be an increased marketing budget behind it.80

89.HCC told us that the loss of PGI status might require a fundamental re-branding exercise for Welsh lamb and Welsh beef, which could entail “very substantial costs”.81

90.The EU scheme for GIs allows for international registration, for example Colombian Coffee. However, HCC told us that legislation giving mutual equivalent protection for European food names had to be incorporated into the third country’s law.

91.Geographical indicators enable UK businesses to add value to their product and to assert provenance and quality. The Government must ensure that protected geographical indicators are retained in a similar form after the UK leaves the EU.

Customs Checks

92.UK membership of the EU Customs Union means that there are no customs duties inside the union and there is no need for UK traders to prove the origin of their goods at internal borders. Trade in food products of animal origin for human consumption between Members States takes place without certification or controls at borders between the different Member states. There are no charges or any specific hygiene inspections on these consignments.82

93.During the inquiry, we took evidence on the impact that the UK trading as a “third country” would have. Our witnesses told us that Brexit presented challenges to maintaining the current flow of trade. As a “third country” the UK will be subject to strict customs checks and controls at the first point of entry into the territory of the EU, to ensure that products are of a satisfactory standard.

94.For example, exporters of products of animal origin will need to go through the following steps:

(1)register with the EU as a third country company that is authorised to export animal products to the EU;

(2)apply for relevant import licences along with documentary proof of the product’s country of origin:

(3)apply and pay for veterinary certificates to show that the product meets EU public health standards;

(4)notify the relevant EU Border Inspection Post (BIP) in advance of the arrival of the goods;

(5)arrive at the first point of entry into the EU only at an approved EU Border Inspection Post;

(6)submit the goods for veterinary inspection before the consignment is permitted to freely move on to its destination within the EU.83

95.During the inquiry we looked at two impacts of trading outside a customs agreement: an increase in cross border administration paperwork; and border inspection post capacity.

Increased Cross Border Administration Paperwork

96.Witnesses told us that new checks on rules of origin84 and new declarations would be a significant barrier to the smooth flow of goods between the UK and EU. Rules of origin would apply to the UK both were it to agree a FTA with the EU, and also if it were to trade under WTO rules.

97.Rules of origin are an “incredible complex subject”, and many UK small and medium-sized businesses will not have had experience of dealing with them.85 The British Meat Processors Association noted the negative affect it would have on supply chains, particularly on the pork sector: “The real complications come when you bring something into a country, make it in another product and then export it. Then you have to start deciding what percentage of that product has come from one particular country. It is a pretty complicated area”.86

98.If the UK is treated as a third country post-Brexit, exports or imports of animals or animal products to and from the EU must be accompanied by a health certificate, signed by a veterinary surgeon. The British Veterinary Association estimated that post-Brexit the volume of products requiring veterinary certifications could increase by 325%.87

99.The current system for veterinary certificates is a paper-based system. AHDB told us there was a need to transition towards an electronic health certificate type arrangement. The NFU agreed that the Government needed to invest in IT systems to improve traceability that enabled data to be shared along the supply chain and to ensure that export health certificates were in place.88

100.There are currently 1,063 Official Veterinarians authorised by the Government’s Animal and Plant Health Agency (APHA) to certify food products for export to third countries. The British Veterinary Association told us that this would have to be significantly increased.89 The Royal College of Veterinary Surgeons highlighted the UK’s reliance on non-British vets. The Food Standards Agency estimated that 95% of veterinary surgeons working in the meat hygiene sector graduated overseas.90 They stated that any threat to the inflow of EU vets would be a threat to the UK’s ability to trade animal products internationally.91

101.Witnesses told us that it was important for the UK to retain veterinary equivalence once it left the EU in order to maintain access to third markets. The NFU cited the example of South Africa (the UK’s biggest export market for poultry), where the EU has a veterinary agreement with South Africa, which grants EU Member States, including the UK, veterinary equivalence.92

102.Export certification demands are likely to increase dramatically. We recommend that the Government set out how it intends to increase resources to ensure that trade is not affected by delays in the process. It is imperative that the Government invest in IT systems to support a more efficient export certification process in order to minimise delays to trade.

103.Non-British EU veterinary surgeons are critical to the UK veterinary workforce. The Government must set out how it intends to ensure working rights for non-British EU vets currently working in the UK and to support the veterinary workforce going forward to ensure that it can meet the needs of the UK’s food industry in the future.

Border Inspection Post capacity

104.Any consignment of animals or animal products from third countries to the EU, may only enter the EU at a designated border inspection post (BIP). All such consignments of imported animal food products are subject to a documentary, identity and possibly physical examination at the first point of entry into the EU, and all consignments must pay a hygiene inspection charge depending upon the type and amount of the commodity being examined. These charges are harmonised, laid down in EU legislation and quite independent of any customs dues payable.93

105.On the northern coast of the EU nearest to Britain there are only a limited number of approved EU border inspection posts. Mr Neil Brooks, former Principal Veterinary Administrator at the European Commission, told us that this would limit the ports through which UK exporters of products of animal origin may initially send or route their consignments of these products.94 Calais and Boulogne are not currently listed as border inspection posts; while the only listed BIP in the Republic of Ireland is Dublin. There are no control points at the land border between the Republic of Ireland and Northern Ireland.

106.Witnesses expressed concern that additional checks at the border would lead to delays and affect the flow of trade. FDF Scotland described the physical delays that additional customs checks would cause:

[They] require[…] a lorry to stop. It requires someone to look in the lorry, it requires the paperwork to be checked. It requires the lorry to go back in line and it requires it to go on to the train or on to the boat, or across the border between Ireland and Northern Ireland. All that is something that is currently in play with countries outside the European Union when it comes in. All of that can be a delay.95

107.Current border inspection posts are not capable of dealing with additional checks required from imports and exports to and from the EU. The primary freight port between Europe and the UK is the Port of Dover. On an average day, almost 16,000 trucks pass through the Port of Dover.96 This capacity was achieved through dismantling all checks at both Dover and Calais.

108.At ferry terminals, disembarkation is free flow unless a vehicle is pulled aside, and vehicles travel through the ports incredibly quickly, with very limited human intervention.97 There is no parking space for disembarking from the ships and there are no services in the terminal for any truck that does have to stop. The ferry terminal has a just-in-time logistics model which is dependent on goods arriving punctually and predictably. The British Meat Processors Association expressed concern that Dover and Holyhead would be unable to cope with the likely amount of border clearances involved unless suitable arrangements were put in place.98

109.The RSPCA expressed concern that, on leaving the EU customs union, the UK would no longer have access to TRACES (Trade Control and Expert System). This is a web-based veterinarian certification tool used by the European Union for controlling the import and export of live animals and animal products within and without its borders. It facilitates the exchange of information between all trading parties and control authorities, speeds up the administrative procedures when trading in plants and animals and can even aid as an enforcement tool. The RSPCA told us that continued access to the system needed to be a “fundamental goal”.99

Northern Ireland

110.There are specific issues relating to trade between Northern Ireland and the Republic of Ireland due to the complexity of the land border. Trade between the two countries is interlinked.

111.The trade in live cattle and sheep, and beef and lamb across the Northern Ireland/Republic of Ireland border takes place on a daily basis, with approximately 390,000 live lambs crossing the border annually.100 The Livestock and Meat Commission for Northern Ireland told us that the Northern Ireland sheep industry was particularly exposed to the effects of more complicated border arrangements, with approximately 45% of all lambs born in Northern Ireland exported to the Republic of Ireland each year. In 2016, the value of this live trade was approximately £31.5 million.101

112.The dairy industries in Northern Ireland and the Republic of Ireland act as one through the supply chain, and dairy products cross the border several times between the farm gate and the consumer. Republic of Ireland dairy co-operatives own approximately 60% of the processing capacity in Northern Ireland. Exports to the Republic of Ireland were approximately 15% of total sales of the Northern Ireland dairy industry in 2015.102

113.Witnesses told us that it was essential that two-way access between Northern Ireland and the Republic of Ireland remained “without tariffs and free from burdensome non-tariff administrative measures”.103 Dairy UK said that a hard border would be the least desirable option for the dairy industry.104

114.On Friday 8 December 2017, a Joint Statement from the negotiators of the European Union and the United Kingdom Government on Phase 1 included commitments on the approach to be taken to avoid a “hard border” between the Republic of Ireland and Northern Ireland. This entails a commitment, if agreed solutions with the EU are not found to achieve this, to maintaining a “full alignment” with the rules of the Internal Market and the Customs Union in respect of “North-South cooperation, the all island economy and the protection of the 1998 [Belfast] agreement”. The document also commits to ensuring there are no new regulatory barriers between Northern Ireland and the rest of the United Kingdom.105

115.The Secretary of State told us that the Government was aiming to secure a trade deal overall that would work in the “interests” of the Republic and the UK. He continued that “full alignment […] means that we seek to achieve the same goals, but we reserve the right to achieve them through different means”.106

116.Any change in our trade arrangements has implications for the smooth movement of goods between the EU and the UK, and could lead to serious disruption to supply chains. A future bespoke agreement must address the costs and delays associated with customs and border controls.

117.Delays at border inspection posts lead to increased costs, and are a threat to perishable goods. It is imperative that the Government sets out how it intends to ensure that the right IT systems and infrastructure are in place for the import and export of agricultural produce so that businesses can continue to trade smoothly with Europe, including the Republic of Ireland, and the rest of the world.


63 International Classification of Non-Tariff Measures, United Nations Conference on Trade and Development, 2012

64 In some areas the EU replaces national legislation with harmonised rules. These are common standards which exist in areas such as technical regulations, and food safety and animal health.

65 Where rules are not harmonised, the Single Market guarantees that products and services can be sold irrespective of their differences through mutual recognition of member state regulations.

66 The rules of the Single Market are underpinned by institutions to ensure they are enforced.

67 Trade after Brexit: Options for the UK’s relationship with the EU, Institute for Government, 18 December 2017

68 Q137

69 Q167

70 Q441

71 Q126

72 Q167

73 Q381

74 Qq144,167

75 Q372

76 RSPCA (BRT0025)

77 Q505

78 Q469

79 Hybu Cig Cymru (BRT0034)

80 Q61

81 Hybu Cig Cymru (BRT0034)

82 Mr Neil Brooks (BRT0005)

83 Mr Neil Brooks (BRT0005)

84 Rules of origin are used to determine where a product and its components were produced, thereby ensuring that the correct customs is levied.

85 Q61

86 Q61

87 British Veterinary Association (BRT0027)

88 National Farmers’ Union (BRT0030)

89 British Veterinary Association (BRT0027)

90 Written evidence received from the Food Standards Agency as part of our Feeding the nation: labour constraints inquiry, Session 2016-17, (LSH0010 )

91 Royal College of Veterinary Surgeons (BRT0054)

92 National Farmers’ Union (BRT0030)

93 Mr Neil Brooks (BRT0005)

94 Mr Neil Brooks (BRT0005)

95 Q464

97 Q126

98 British Meat Processors Association (BRT0007)

99 RSPCA (BRT0025)

100 Q115

101 The Livestock and Meat Commission for Northern Ireland (BRT0013)

102 Dairy UK (BRT0059)

103 Dairy UK (BRT0059)

104 Dairy UK (BRT0059)

106 Q575




12 February 2018