Trade Bill

Written evidence submitted by the International Chamber of Commerce United Kingdom (TB03)

UK TRADE BILL SUBMISSION

Summary

1. As the UK leaves the EU and faces serious economic consequences from the impact of Covid-19, it is vital for global trade that the UK promote open trade relations with all the major economies and regions. We would welcome UK support in promoting an open, rules-based trading system that does not force countries and businesses into making choices along political lines but fosters solutions to growing trade tensions and trade wars.

 

2. The Trade Bill should be seen as a building block to these priorities, not just a technical piece of legislation in isolation of the wider context in which the UK trades. The UK is now in live negotiations with some of the largest trade economies and the trading system is in a major global crisis with Covid-19, trade wars and protectionism. The urgency to address practical matters such as establishing a Trade Remedies Authority is understandable but the Bill is also an opportunity to debate the wider issues and the kind of trade model the UK wants or needs to have in place. Similarly, the Global Procurement Agreement is important but only a fraction of the trade in services agenda, now over 50% of global trade and over 80% of UK trade. There ought to be stronger linkages between the Bill and other important legal frameworks and policy agendas.

3. Trade defence is one aspect of trade – governance, trade support, market access, trade negotiations, improving the global trade environment and connectivity to other key policy agendas such as climate, food, sustainability, digitisation and development are equally important. Coherence, resilience and the need for reform are now top priorities at national, regional and inter-governmental levels. In our view, the Covid-19 crisis is not about trading as we were but reforming the system so trade contributes to delivering the UN Sustainable Development Goals framework by 2030 and ensuring trade works for everyone. The Trade Bill should be seen as a vehicle towards this singular goal, to generate more debate, promote consensus and ensure the UK is playing its full part in making the trade system better for everyone – across the UK and overseas.

4. Progress has been made since 2017/8 but there is still much to do to implement the priorities set out in ‘A Trade Model That Works for Everyone [1] ’ which ICC published with leading business groups, unions, NGOs and consumers. We no longer live in a world where trade can be treated separately from our international commitments on issues such as climate action, digitisation or building a more resilient health system. The public need to feel confident that trade decisions and processes are working for them and the Bill is a good opportunity to embed a more transparent, consensus based, democratic approach that clearly demonstrates a net benefit all. It’s an opportunity to set a new gold standard.

5. We accept the Bill is not designed to do all of this but it is an opportunity to forge a way forward that brings stakeholders together, where the Bill becomes a stepping stone to ensuring these issues are addressed. That way, the Bill becomes less functional and more purposeful.

Specific Comments

International trade agreements

1. Continuity agreements are welcome but shouldn’t be confused with actual trade agreements. Continuity agreements are likely to be temporary until countries are clear on the UK-EU relationship and a useful tool to minimise disruption which no-one wants.

2. More debate about the role of bi-lateral trade agreements would be welcome. Following the example of Singapore would be an obvious approach for the UK. The Singaporeans explicitly support multi-lateral and plurilateral trade negotiations as a way to promote greater inclusion in the global rules-based trading system and then go further in bi-lateral negotiations to forge modern, high standard trade corridors where it makes economic sense to do so i.e. the new Singapore-New Zealand-Chile Digital Trade Deal. This approach is particularly important for economies reliant on trade in services, such as the UK, where national leadership is required to improve global trade in services, now over 50% of global trade. The EU, Japan, USA negotiations ought to be aiming to raise the bar and set the foundations for more dialogue to advance the services agenda in the World Trade Organization.

3. More debate is also needed about the role of the UK in maintaining healthy trade relations with China, the EU and USA. Historically, the UK has always acted as an important pragmatist in bridging the dialogue between the top tier trade economies and developing nations, particularly across The Commonwealth. To return to this role as an independent trading economy means getting it right with all three of the top tier economies and not being seen to favour one to the disadvantage of the other, as others do such as Japan, Canada and Australia.

Trade information

1. Trade is not simply about exports nor is the UK an export economy. There is an opportunity for the Bill to enable HMRC to collate better quality trade information covering imports, exports and services. This could have all sorts of benefits in terms of better policy, service provision, decision-making and a higher quality public debate on trade.

Delegated powers, Devolution, Parliamentary scrutiny of trade agreements

1. ‘Henry VIII’ powers, no formal role for devolved administrations and Parliament’s role limited with no formal role in negotiations and no need for debate, vote or approval signals a reduction in democratic engagement and runs contrary to the 2018 Trade Model recommendations to promote more inclusive and transparent dialogue.

2. The Bill ignores the seriousness of the situation we face regarding trade. Public trust in the system is at an all-time low - this is an opportunity to acknowledge the failures and get it right if the UK wants to set new global standards, ensure everyone benefits and future proof trade governance.

3. More democratic engagement, consensus building, transparency and Parliamentary oversight are essential to re-building public trust. As it stands, the Bill risks further undermining public trust with too much power in the hands of the Executive leaving Parliament little ability to hold government to account and provide scrutiny and oversight should decisions fail to benefit communities and regions across the UK.

4. This risk is being amplified by the informal, adhoc nature of stakeholder engagement in operational trade structures and processes. This latter issue is not legislation dependent but it does contribute to sending the wrong message and is an important piece of the jigsaw.

June 2020

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INTERNATIONAL CHAMBER OF COMMERCE

ICC is the largest world business organisation representing 45 million companies employing 1 billion people in over 100 countries. We are the only business organisation with UN Observer Status, a B20 Co-founder/Network Partner, strategic partner to the WTO, UNFCCC business focal point for climate change and convener of the UN SDG Business Forum. ICC rules underpin $25trn global trade and processes over $200bn of disputes annually.

ICC United Kingdom is the representative office of ICC in the UK and works with British business groups and stakeholders to represent the voice of UK business at inter-governmental level - the United Nations, G20 and World Trade Organization.