Stakeholder event on leaving the European Union without an agreement (“No Deal” scenario)

On Thursday 7th March, 2019 Tom Goodman, and I were present at the event organised by HSE to advise stakeholders in the chemicals and associated sectors on the position that would apply should the UK leave the European Union without a withdrawal agreement. The event was a collaboration between the HSE chemicals and explosives sections and the Department for Business, Energy & Industrial Strategy (BEIS).

The programme was constructed so that an overview session for both chemicals etc and explosives was given at the opening and then the sectors broke for separate presentations that were directed at the stakeholders in that sector. Copies of the presentations are to be sent to all stakeholders who attended the event.

The points I took from the remarks of those opening and involved in the joint session were –

  • The government main position is committed to obtaining an agreement (this was emphasised more than once)
  • The content of the event had the caveat “it all depend on what next week brings”
  • The flexible approach we are adopting to goods from within the EU is not likely to be reciprocated where EU applied standards (CE for example) goods are to be exported from the UK to the EU. We will be regarded in the same way as other non-EU countries.
    • The result of this would involve changes in regard to import and export arrangements between UK and EU
    • Sector impacts will vary dependant upon the status of the goods being transferred between the two areas.
    • The present event it was stressed focused only on leaving without an agreement.
  • Our existing notifying bodies accreditation will cease and EU standard accreditation will have to be via an EU established body.
  • HMRC have a comprehensive programme for dealing with issues surrounding any challenges.

The move was towards a future economic relationship that follows the government white paper of July 2018. In essence arranging a close alignment in these sectors. The aim was following the existing rules, the creation of a “common rule book” so that regulation can deliver the same result for UK and EU.
BEIS presentation highlighted the following areas from the work they had undertaken with the other government departments and on which BEIS have and are continuing to work –

  • Free trade agreement between both UK and EU, creation of tariff free zone
  • No custom or route of origin requirement
  • Ongoing harmonization – establishment of a single assessment process for both sides

The priorities that stakeholders need to be aware of

  • Import/export tariffs – position for import duties and processes with HMRC
    • Changes at the border – Transfer of custom declarations to new software. There was a need for stakeholders to talk with providers
    • Economic Operator Registration and Identification (EORI). – If not already, it is urgent that effected stakeholders have the registration as logistics providers will need to know and it also has application to any deferment of duty account.
    • Transitional Simplified Procedures – HMRC will introduce a simplified process for import of EU goods post exiting the EU for ports operating roll on-roll off. The full outline of this is available here.
    • Bank payment guarantees will need to be in place by June this year.
    • Safety and security declarations will require all fields to be completed
  • HMRC will suspend for 6 months any entry summary declaration for EU goods.
  • Other certificates and licences – stakeholders will need to check status and goods relative. Main issues flagged up –
    • VAT
      • Postponed account for import VAT
      • Low value consignment relief will be abolished (online for VAT under threshold £135 on imports)
      • EU will treat all UK goods as due for VAT.

EU settlement scheme – The same rules will continue to apply to all EU citizens

Personal Data Transfers – The existing rules and regulatory framework in the Data Protection Act 2018 and General Data Protection Regulation will be followed post date of exit.

The presenters were clear that once the politicians had made the decisions the various government departments and agencies had done the background work to implement one way or the other.

The session for the explosives sector brought into focus the previously published guidance material from late last year and the Product Safety and Metrology etc. (Amendment etc.) (EU Exit) Regulations 2019, which contain the amending provisions in the Explosive Regulations 2014 and relevant legislation for Northern Ireland where it applies. The session set out the approach already explained above and fixed it to the practical application for those in the explosive sector.

The key issues in preparation of the UK explosives sector for a no deal situation highlighted are –

  • Ensuring that safe and compliant products are on the UK market
  • Continuity of supply from EU into the UK for a temporary transitional period
  • Most explosives that meet the UK regulatory requirements will continue to be recognised as valued for sale on UK market.

The slide presentation copy provides the key issues in a ‘no deal’ scenario. Again there are some bullet points to focus on –

  • As a start point the UK will continue to accept explosives bearing the CE mark as being compliant for the purposes of being imported to the UK.
  • Conformity assessment and marking and labeling – as such are subject to UN regime and will not be affected in UK
  • Any materials for exporting to EU area requiring to be assessed by a ‘Notified Body’ will need to have re-assessment.
  • Those presently regarded as ‘distributor’ under ER 2014 may become ‘importers’ for that requirement
  • For Transport of Dangerous Goods (ADR) we will accept common EU to UK equivalence
  • As UK will be treated as 3rd Country, we will have no EU notifying body, or those requirements specific to EU.
  • There is a need to consider the EU interpretation of what constitutes “placing on the market” post leaving
  • All explosives classified in UK will bear a ‘UKCA’ mark (not acceptable in EU) and UK will establish a UK approved body in line with the existing common EU model to deal with all imports approval for UK market.
  • Transfer of explosives – Those importing will continue to require an Inter-Community Transfer (ICT) document from the point of commencement to the UK border. From UK border an authority will be required to complete the journey within the UK.
  • Within Great Britain the existing regulatory requirements for a Competent Authority Transfer Document will be unaffected as will transfers to Northern Ireland.
  • Those stakeholders who have inter European explosives transfers and sales will benefit from looking at the EU Commission preparedness notices, especially the information q&a dealing with ‘placing on the market’. This can be in the list of links below.

The explosives team also provided via the presentation the following links for the information of stakeholders –

UK Government technical notices – Trading goods regulated under the ‘New Approach’ if there’s no Brexit deal:
Visit Here

The UK mark (UKCA) guidance on using the mark:
Visit Here

HSE Brexit web page:
Visit Here

Commission preparedness notices:
Industrial products:
Visit Here

Q&A on ‘placing on the market’:
Visit Here

Civil Explosives:
Visit Here

Anthony J. Slate
Vice President, Legal & Compliance

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