Alison Ryan, London Office, Bord Bia –Irish Food Board
14 days until Brexit
Key events this week:
The UK government announced its temporary tariff regime in the event of no deal Brexit on Wednesday morning. You can read the full tariff schedule here. Tariffs would be eliminated on 87% of products, but levies would be introduced on beef, chicken and pork, as well as selected other products. The new tariff system would only apply for 12 months after a no-deal rupture while the government consulted on a new, permanent approach to tariffs.
The government also announced that in the event of no deal, there would be no tariffs on goods crossing from Ireland into Northern Ireland and all checks would be lifted, other than those the UK is compelled to make to comply with international law. Northern Irish agricultural and manufacturing businesses leaders said the plan would be “devastating”. They also flagged that Northern Ireland could become a “smuggling channel to avoid tariffs” creating a “Wild West” border.
Theresa May’s exit deal was rejected by 149 votes in the House of Commons on Tuesday. The loss followed on from a statement from the Attorney General, Geoffrey Cox, earlier in the day that warned that the risk of the UK remaining trapped in a so-called backstop arrangement to avoid a hard Irish border after Brexit remained “unchanged”, despite the three changes to the withdrawal agreement that May agreed on with European Commission President Jean-Claude Juncker late on Monday evening.
The House of Commons voted by 321 votes to 278 to take a no-deal off the table permanently on Wednesday evening. This was originally a government motion that sought to reject the no-deal option only for March while keeping it on the table in the long term. May had initially given a free vote to MPs on the motion. However, an amendment to the motion, calling for the Commons to reject no-deal Brexit at any time and under any circumstances, was passed by 312 to 308. This resulted in May pulling the free vote and whipping her own MPs against her amended motion. This vote was passed by a majority of 43 votes. On that final vote, 12 ministers, including four members of cabinet — Greg Clark, Amber Rudd, David Mundell and David Gauke – abstained. Number 10 indicated that the rebels would not be fired.
On Thursday evening, the Commons backed by 412-202 votes, May’s strategy to apply to the EU next week for a short delay in Brexit until June 30, if MPs finally endorse her exit deal at the third time of asking next Tuesday. The successful motion also stated that if MPs vote against the deal again next week there could be a longer extension beyond June 30, requiring Britain to take part in European Parliamentary elections in May. Tory MPs were given a free vote on the issue and eight Eurosceptic cabinet ministers voted against a delay to Brexit, including Brexit secretary Steve Barclay and trade secretary Liam Fox. The vote was passed with the backing of Labour MPs, who were whipped to back to the motion, although 24 Labour MPs defied the whip. In order for a Brexit delay to take place, EU leaders must unanimously approve the request.
Also on Thursday, an amendment calling for a second referendum was overwhelmingly rejected by 334 votes to 85. The amendment was put forward by Sarah Wollaston, former Conservative MP who defected to the Independent Group. Labour frontbench were ordered to abstain, as although the party’s policy is in favour of a public vote if required to break the Brexit deadlock, they stated that now was not the time to advance that policy. The official People’s Vote campaign had also urged MPs not to support the amendment, arguing it was not yet the time to press the case.
Implications for Irish food & drink companies:
Irish companies should consult the UK temporary tariff regime to see if they will be affected.
In the event of a No-Deal Brexit, the suggested tariff regime announced on Wednesday would be detrimental to Irish farmers and Ireland’s agri-food exporters, in particular, the beef and dairy sectors. Furthermore, Irish food companies would have to compete with low cost and lower standard imports from non-EU countries coming into the UK. It is worth noting that the current UK documents do not provide full details, only offer a temporary solution and will only apply in the event of No Deal Brexit.
It is looking increasingly likely that Brexit will be delayed beyond March 29. Depending on whether MPs vote for May’s withdrawal deal next Tuesday, this delay will either be until June 30 or it could potentially be a longer delay. The EU must also agree unilaterally to the extension. If the EU do not agree to an extension – which seems unlikely – the UK still leaves the EU on March 29, but without a deal.
There are signs that Eurosceptic opposition to May’s withdrawal deal is starting to crumble under the threat of a long delay to Britain’s exit from the EU. The DUP leader, Arlene Foster, said that “nobody wants to leave without a deal” and added that her party was working on reaching an agreement with the government. Furthermore, some members of the pro-Brexit Conservative European Research Group have signalled that they are considering swinging behind the prime minister’s deal. If the DUP were to support May’s withdrawal deal, this woud increase the chances of it passing through parliament.
- There will be a third vote on Theresa May’s Withdrawal Deal next Tuesday. Depending on the result that vote, May will seek an extension on Article 50 from the EU, until either the end of June or “a much longer extension”.
- The EU leaders will meet next Thursday, March 21 for a European Council meeting. Theresa May and Michel Barnier had previously marked this date as the end of talks between the EU and the UK on the Withdrawal Agreement. EU leaders will use this summit as an opportunity to debate the issue of an extension to Article 50.
You can find more information here on Bord Bia’s workshops and training programmes, which are designed to help client companies exporting to the UK prepare for Brexit.