Goods movements
The agreement establishes a new UK internal trade scheme based on commercial data-sharing, not international customs processes, for the movement of goods. This new scheme will significantly expand the range of businesses who can benefit; end the requirement for traders to provide customs commodity codes for each movement; scrap burdensome supplementary declarations; and ensure that businesses can therefore move their goods using the same type of commercial information as they already hold when moving goods to the Isle of Wight. Traders already using the UK Trader Scheme will, if they wish, be auto-enrolled in the new internal market scheme, and it will be straightforward for new traders to sign up.
To ensure that we properly protect internal UK trade, the agreement significantly expands the number of businesses able to be classed as internal UK traders and move goods as ‘not at risk’ of entering the EU through three important changes:
- First, businesses throughout the United Kingdom will now be eligible – moving away from the previous restrictions that required a physical premises in Northern Ireland.
- Secondly, we will increase the turnover threshold below which companies involved in processing can move goods under the scheme which they can show stay in Northern Ireland – quadrupled from the current £500,000 limit up to £2m, meaning four-fifths of manufacturing and processing companies in Northern Ireland who trade with Great Britain will automatically be in scope.
- Thirdly, even if firms are above that threshold, they will be eligible to move goods under the scheme if those goods are for use in the animal feed, healthcare, construction and not-for-profit They will be able to do this even as intermediaries or if they sell on the eventual product, in a significant improvement to the existing arrangements. Inputs into food production will continue to benefit from inclusion in the ‘not at risk’ definition.
For those in the scheme who can show that their goods will stay in Northern Ireland, we will provide a radically simplified process for goods movements, underpinned by the existing Trader Support Service (TSS). To do this the system will draw on existing data that businesses already hold and provide about the type of goods they are moving, allowing goods to move seamlessly East-West:
- The movements will use ordinary commercial data, with information provided to TSS based on data from sales invoices and transport contracts;
- There will therefore be no requirement to provide the burdensome customs commodity code for every movement;
- Goods will automatically be treated as internal UK movements for tariff purposes, with no rules of origin requirements;
- There will be no customs checks, except for risk-based and intelligence-led operations targeting criminality and smuggling; and
- Once a good has moved, there is no further process involved – scrapping the requirement for businesses to provide the hugely burdensome, 80-field supplementary declaration, for every single goods movement, after goods had arrived in Northern Ireland.
These new arrangements for the smooth flow of trade within the UK internal market are underpinned by data-sharing and technology. This will ensure that there is real-time data on goods movements to support risk analysis, removing the need for the extensive bureaucracy and checks that will continue to apply for goods moving on into the EU.
In putting these arrangements in place, we have also been able to address a range of issues that also added frictions or costs into internal UK trade:
- We have safeguarded tariff-free movements of all types of steel into Northern Ireland – dealing with the problems that emerged in the summer of 2022 and providing certainty and stability for the sector.
- We have established a forward process for ensuring that Northern Ireland’s firms can access other goods subject to Tariff Rate Quotas in the future, dealing with the unique disadvantages under the existing system.
- And where traders cannot be certain of the end destination of their goods when first moving them into Northern Ireland, in the coming months we will establish a new, comprehensive tariff reimbursement scheme for those who can show the goods were ultimately not destined for the EU – delivering on a key priority for businesses and trade organisations.
Though there are already legal protections for goods moving from Northern Ireland to Great Britain to be placed on the UK market in all circumstances, the original Protocol called for export declarations on all those movements, and a subsequent agreement between the UK and EU in 2020 looked to provide “equivalent information” in their place. But each of these proposed arrangements risked significant and unacceptable frictions for trade; had not been given effect in practice; and had in turn been a source of dispute between the UK and EU. This agreement resolves those issues by removing any requirement to provide export declarations, or any equivalent information, for businesses moving goods from Northern Ireland to Great Britain. This assures unfettered access for Northern Ireland’s businesses to the UK market on a permanent basis, with controls applied only where strictly necessary to manage our international obligations, such as for movements of endangered species.
This provides a permanent guarantee of free movement for this critical trade within the UK internal market, giving certainty to business and avoiding any new To underscore this protection, the Government will legislate to reinstate provisions in the UK Internal Market Act, dropped during the Bill’s original passage in 2020, to provide protection in law against export procedures, and will do so now in full compliance with international law and our own constitutional order.
Agrifood
The original Protocol applied the same burdens on agrifood trade between Cairnryan and Larne as between Holyhead and Dublin. That meant that as many as 500 officially-signed certificates, costing up to £150 per certificate and requiring hours of preparation, needed to be produced for a single supermarket lorry. The original Protocol also mandated a set proportion of physical checks – from 15% for dairy, to 30% for red meat, fish and poultry, and even 100% for some fruit and vegetables – which could involve hours of checks and even laboratory testing. A range of foods – from sausages to seasoned lamb joints – would have been banned completely, with no scope to even transport these goods to Northern Ireland. The full extent of these burdens has been avoided so far, but only through temporary grace periods applied by the UK – with the EU taking legal action in response.
Whilst the UK acknowledges that the grace period arrangements have worked to safeguard food supplies, they are not a basis for long-term trade. And there are important practical drawbacks in their operation. No new businesses can benefit from the grace periods, excluding businesses like caterers and those supplying schools and hospitals; all chilled meats such as sausages have to be accompanied by costly veterinary certificates; and the arrangements are based solely on EU standards, meaning they are vulnerable to the effect of divergence over time.
Through this agreement, we have secured a new sustainable, long-term legal framework for agrifood retail trade into Northern Ireland:
- All traders moving agrifood goods for the final consumer in Northern Ireland can become members of the UK-run scheme – including retailers, wholesalers, caterers and those providing food to public institutions like schools and hospitals.
- Bans on British products such as sausages entering Northern Ireland will be scrapped permanently: with those goods available on the shelves in Great Britain again able to move smoothly to Northern Ireland.
- The threat of up to 500 certificates for a single truck will be replaced with a single document confirming that goods are staying in Northern Ireland and are moved in line with the terms of our internal market scheme.
- That document will be electronically and remotely processed, without being physically checked. There will be no need for official veterinarians or plant inspectors on site in supermarket distribution centres or costly ‘attestation’ supporting documentation for products, with proportionate arrangements for competent authority oversight based on risk and intelligence.
- The scheme will not be limited solely to goods from Great Britain or the EU. Goods from across the world can be moved in the scheme, either where they are processed in the UK, where they meet UK public health standards and pose no disease risks, or, where there are potential disease risks for products moved from the rest of the world, where the UK has chosen to take the same approach to protecting against the same pests and diseases.
- The solution on physical checks will match the UK’s proposals in July 2021, with no arbitrary or set physical checks, and interventions based only on risk and intelligence decisions made by UK authorities, to deal with smuggling, criminality, abuse or specific risks to animal, plant or public health.
To deliver these arrangements the agreement codifies in legal text a unique arrangement in which UK public health and safety standards will apply for all retail food and drink in the UK internal market. UK standards will also apply more broadly for this trade, covering rules on public health, marketing, organics, labelling, genetic modification, and drinks such as wines, spirits and mineral waters. Overall, it will remove more than 60 EU food and drink rules in the original Protocol covering well over 1,000 pages of law. Where relevant, these goods will still need to meet EU standards on animal and plant health diseases. But the Government already has, and will always continue to have, protections in place to guard against those same diseases – such as foot and mouth, African Swine Fever and BSE – right across the United Kingdom. This arrangement also conforms with our long-standing recognition of the special need to protect the biosecurity of the island of Ireland, preventing animal and plant disease. This is, in effect, a dual-regulatory solution that will protect choice for consumers whilst also working for businesses in Northern
The new agreement therefore addresses an important weakness of the old Protocol (and indeed the grace period), which mandates that all goods must be produced to EU, not UK, standards. As a result, for example, we have already seen food products such as cakes containing titanium dioxide be removed from sale by supermarkets in Northern Ireland because of EU prohibitions. Whilst the extent of divergence has been limited to date, over time this has the potential to increase. This agreement locks in a durable internal UK market system for the long-term, providing resilience against future UK-EU rule changes in areas like food safety, organics requirements and marketing standards – including labelling and production rules for goods like This will deal with the impacts of regulatory divergence for internal UK agrifood retail trade. This preserves and protects our internal market in the area perhaps most important to Great Britain – Northern Ireland trade, with more than 75% of food sold in Northern Ireland’s supermarkets estimated to come from Great Britain. This agreement will ensure that Northern Ireland remains deeply integrated into the UK’s food supply chain and our associated regulations and court oversight.
At the same time, the deal recognises the importance of protecting the single epidemiological area on the island of Ireland, as has existed for many years.
- The UK will provide written guarantees through the Chief Veterinary Officer that the operation of the scheme does not pose disease and health risks to the island of Ireland or the EU more broadly.
- The scheme will be operated with appropriate safeguards, such as lorries locked with seals by operators.
- A subset of high-risk products such as meat, dairy and other composite products will be labelled at a product-level on a phased basis through to 2025, in line with the proposals we set out in our July 2021 Command Those labelling requirements will first be introduced on meat and fresh dairy from October 2023, with the Government providing transitional reimbursement funding during this first phase.
From October 2024 these requirements will be extended to include all other dairy products, such as UHT milk and butter, and would be proposed to apply UK-wide from that point, in consultation with the Scottish and Welsh Governments. From July 2025, composite products, fruit, vegetables and fish will also be labelled on a UK-wide basis.
- As the phased labelling requirements come on-stream, we will dramatically scale back the visual identification process operated under the grace periods, in which 100% of lorries are subject to a visual inspection process to guard against smuggling. Though this process has not caused significant disruption, such universal requirements are not appropriate or necessary for UK internal market movements, so these processes will reduce by 90% from 2023, and by 95% from 2025 when labelling requirements are fully in place.
- And we have ensured that these arrangements are futureproofed, with the ability to update and change these safeguards, including labelling requirements, where new technological solutions can support meeting the same objectives in more efficient ways.
Parcels
This agreement also reflects the significant importance of parcel deliveries for day-to-day lives in Northern Ireland. Under the old Protocol every single consumer parcel movement would have, if not for a unilateral UK grace period, required a full customs declaration, risking widespread disruption and costs for people across Northern Ireland reliant on those deliveries, and increasing the withdrawal of services from firms in Great Britain.
Under the agreement, we have safeguarded these movements and maintained business as usual for Northern Ireland consumers, through the unprecedented removal of requirements under the EU’s customs code. That means for parcels sent to friends and family in Northern Ireland, the process will be exactly as it is today, with no requirements on either the sender or recipient of any kind.
For crucial e-commerce movements from businesses to consumers, the agreement scraps the requirements for customs declarations, pre-notification, presentation of goods to customs authorities and the range of burdensome requirements that applied under the old Protocol. Instead, the UK has agreed that authorised parcel operators will manage a process of sharing data, in batches, to monitor and manage any risks of smuggling into the EU market. This will mean Northern Ireland citizens will uniquely be able to receive parcels from both the UK and EU without burdens. Importantly, this new approach will apply even to goods otherwise classified as prohibited or restricted under EU rules (though domestic UK law prohibitions and normal carrier terms and conditions will still apply). To do this, we have changed the legal definition of goods classified as ‘not at risk’ of entering the EU to ensure that consumer parcel deliveries are always classified as goods destined to stay within the UK.
Meanwhile for movements between businesses, we will ensure the same internal market scheme set out above for freight movements is available. This will avoid tariffs and rules of origin requirements, and restore the integrity of the UK internal market (along with the assistance that the TSS can provide).
These arrangements will be in place from October 2024, giving businesses and parcel operators due time to prepare for their operation.
