Trade and Customs Legislation

Department for International Trade written statement – made on 7th November 2017.

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Photo of Baroness Fairhead Baroness Fairhead Conservative

My Rt.Hon Friend The Minister of State for Trade Policy (Greg Hands) has today made the following statement:

On 9 October 2017, the Government published two White Papers [https://www.gov.uk/government/news/government-sets-out-vision-for-post-eu-trade-and-customs-policy]. These papers set out the Government’s approach to legislating for the UK’s future trade policy, establishing a standalone customs regime, and ensuring that VAT and excise legislation operates effectively upon EU exit.

The papers reaffirmed the Prime Minister’s commitment to maintaining and maximising the UK’s position as a global free trading nation, once it leaves the EU, both by boosting our trading relationships with old friends and new allies, and by seeking a deep and special partnership with the EU. The paper reiterated that, in assessing the options for the UK’s future customs relationship with the EU, the Government will be guided by delivers the greatest economic advantage to the UK and by three strategic objectives: ensuring UK-EU trade is as frictionless as possible; avoiding a hard border between Ireland and Northern Ireland; and establishing an independent international trade policy.

The White Papers also confirmed the Government’s intention to bring forward a Trade Bill and a Customs Bill before the end of the year, to put in place the necessary legal powers and structures to ensure the UK is ready from the first day after exit. This will help to provide continuity and avoid disruption for individuals, businesses, and international trading partners.

The Trade White Paper asked for comments on three specific aspects of trade policy – transparency of trade policy; trade remedies frameworks; and the design of a future unilateral trade preferences scheme. The closing date for comments has now passed and the Government will shortly issue its response. Wider engagement on our trade policy proposals will continue.

The Government has now tabled resolutions for a Customs Bill – the Taxation (Cross-border Trade) Bill – and is today introducing the Trade Bill to Parliament.

The Trade Bill will:

  • Create powers to enable the UK to transition trade agreements that currently exist between the EU and other countries, and which we are party to through our EU membership;
  • Create the powers needed for the UK to implement the obligations created by becoming an independent member of the Agreement on Government Procurement, maintaining current guaranteed access for UK businesses to global procurement opportunities and offering value for money;
  • Establish a “Trade Remedies Authority” to conduct trade remedies investigations and to assist with international trade disputes; and
  • Enable HM Revenue and Customs to share data on trade so the Secretary of State for International Trade can carry out other functions currently fulfilled by the European Commission, and share data with other bodies carrying our public functions, such as the Trade Remedies Authority and World Trade Organisation.

The Taxation (Cross-border Trade) Bill will:

  • Allow the government to create a standalone customs regime by ensuring that, among other things, the UK can charge customs duty on goods, set and vary the rates of customs duty, and suspend or relieve duty in certain circumstances;
  • Allow the government to define how goods are classified to determine how much duty is due
  • Allow the UK to set preferential or additional duties in certain circumstances, for example, preferential rates for developing countries (unilateral preferences) and additional duties relating to trade remedies following an independent investigation by the Trade Remedies Authority, and when authorised following trade disputes.
  • Allow the VAT and excise regimes to continue to function whatever the outcome of the negotiations, for example, by enabling supplies of goods and services to continue to move as freely as possible.

Combined, these two key pieces of legislation represent a significant step in creating the statutory framework and powers needed to ensure that the UK is ready for EU exit, and providing certainty and continuity for businesses and consumers alike.

This statement has also been made in the House of Commons: HCWS228